THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, May 10, 1996 TAG: 9605100634
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY DAVE MAYFIELD, STAFF WRITER
LENGTH: Medium: 64 lines
Senior managers of Virginia Power's largest division said Thursday that the Richmond-based utility may cut costs in that group by as much as 30 percent over the next three years. In doing so, they confirmed for the first time that employment reductions are inevitable in their operations, which employ about 5,000 people or roughly half the company's work force.
``In a more competitive world, we want to posture this company to be the best performer,'' said Larry M. Girvin, senior vice president of the utility's commercial operations unit. ``Our peers are not standing still. ''
Girvin's group employs linemen, meter readers and customer-service representatives. There are 1,160 employees of the unit in Hampton Roads, and another 220 in northeastern North Carolina.
Girvin said the cost-reduction target of 20 percent to 30 percent is preliminary and that the earliest that commercial-operations workers' jobs will be terminated is toward the end of this year.
Girvin said he and other senior Virginia Power managers believe that the cost reductions, including employment cuts, are possible while actually improving the level of customer service. By utilizing new technologies and eliminating unnecessary work processes, the company expects to become more efficient, he said.
Girvin, whose work group is the last of the major Virginia Power units to go through a utilitywide re-engineering process, was unwilling to predict the number of job cuts.
He said it will take until mid-summer for a group of about 50 Virginia Power employees to make detailed recommendations for commercial operations.
If employment in commercial operations is cut by 20 percent or more, another 1,000 utility employees could lose their jobs.
That would be on top of close to 1,300 workers whose jobs have been eliminated, mostly at the utility's generating plants, since the re-engineering called Vision 2000 began at the utility a year ago.
The wrenching downsizing is necessary, Virginia Power executives have said, for the utility to compete in a market in which an increasing number of electricity customers are being granted the right to shop for power.
Girvin said Virginia Power may ask the International Brotherhood of Electrical Workers, which represents its hourly employees, to agree to some changes in its contract with the utility to help give the company more flexibility in the way it assigns work.
D.R. ``Cotton'' Sizemore, business manager for the IBEW System Council, said he doesn't know how the company can cut many more jobs. ``Feedback I'm getting from the field,'' he said, ``is that we're understaffed in a number of locations already.''
Sizemore said union officials decided not to participate in the re-engineering process in commercial operations. The IBEW's first effort in cooperating with the utility in re-engineering failed, in union leaders' view. Out of that experience, at Virginia Power's coal-fired and hydroelectric power plants, the union filed numerous unfair labor practice charges against the utility. Those allegations are under review by the National Labor Relations Board.
KEYWORDS: LAYOFFS DOWNSIZING by CNB