The Paducah Sun
The Paducah Sun
Thursday, May 18, 2000
Paducah, Kentucky

Severance confusing workers, director says
Unfinished plan: A concrete plan to pay exposed workers remains far from complete.

By Joe Walker

As the deadline nears for voluntary job reductions at the Paducah Gaseous Diffusion Plant, many workers are perplexed about what to do because they still have questions about financial incentives.

That was the assessment of Gary King, director of the Department of Energy's Office of Worker and Community Transition, after speaking with employees Wednesday. King visited the plant before addressing the executive committee of the Paducah Area Community Reuse Organization, which is developing programs to try to ease job cuts at the plant.

"People said they still didn't know everything they need to know to make a decision," King said. "I'm sympathetic with that."

He said he thinks 400 to 450 USEC Inc. employees will voluntarily leave the Paducah plant and its sister plant near Portsmouth, Ohio, when the cuts start July 14. The balance of the total of 621 job cuts will come during the rest of the year.

That means 75 to 125 reductions by July 14 will be forced because USEC intends to eliminate 525 jobs at the plants on that date, King said.

Workers have until next Wednesday to accept a voluntary severance package including a cash payout of as much as $17,500 plus health insurance benefits and retraining and relocation funds. King said about 90 people at the two plants have signed up, but he expects that number to increase as the deadline nears.

He said that hourly employees probably "have a much better idea" who is on the involuntary list by virtue of union agreements, and that those who realize they will lose their jobs anyway will volunteer to leave.

"Salaried people, who are not judged strictly on seniority, have a much more difficult decision to make, and I think a lot of them are still struggling with that," King said.

Double severance benefits in 1998 and 1999 targeted older workers. Offering less money this time means younger workers are favored, a move that has fostered confusion whether USEC will offer early retirement incentives, King said. He acknowledged that DOE and USEC are in sharp disagreement over the actual value of the USEC pension fund.

DOE says that since USEC took control of the fund last year, high interest has reaped at least $36 million more than it takes to meet current and projected needs. Early retirement now would cost about $7 million, the department says.

USEC disagrees, pointing to a conservative May 3 actuarial report based on 5 percent revenue growth. The report says that if current severance benefits are increased through early retirement offers, more money must be put into the fund money that USEC doesn't have.

"It's turned into a bit of a battle of the fiduciaries," King said.

The House Commerce Committee's Oversight and Investigations Subcommittee has asked USEC to approve early retirement. Rep. Ed Whitfield, R-Hopkinsville, is a member of the committee.

King said he understands that Whitfield and others on the committee are still trying to arrange a meeting between DOE and USEC managers to resolve the issue. He said that he does not expect a resolution before the May 24 deadline but that early retirement might still be offered afterward.

Workers told King more money should be available for voluntary severance. He said the shortfall is partly because the job cuts are more extensive than foreseen when King's budget was put together for this fiscal year. He said the budget has $21 million for jobs programs nationwide, $5 million less than requested.

Even with more money, the work-force transition program may not spend more than $24.5 million in any fiscal year without congressional approval, King said.

By finding money available from some work-force programs elsewhere, about $8 million has been made available for Paducah and Portsmouth, King said. USEC is providing about $1.5 million or $2,500 per worker, he said.

Further complicating the situation are uncertainties about funding to create DOE environmental cleanup jobs into which displaced USEC workers might move, King said.

"We think they (jobs) will be created a little bit more slowly than we had hoped back in February," he said. "There are a lot of variables out there yet, and it's really frustrating for people to try to deal with those variables in making really important life decisions."