AEP to cut jobs across state; Buyout offer made to workers in W.Va. and 10 other states
The utility wants to shed 5 to 10 percent of its workforce, and warned that it may have to lay off workers if not enough employees accept the voluntary severances.
CHARLESTON, W.Va.-- American Electric Power plans to cut up to 2,200 jobs in 11 states, including West Virginia, through a buyout offer to employees, the company announced Wednesday.
The utility wants to shed 5 to 10 percent of its workforce, and warned that it may have to lay off workers if not enough employees accept the voluntary severances.
Appalachian Power, an AEP subsidiary, has 2,780 employees in West Virginia, so as many as 278 power company workers across the state could be affected.
"It's to address the impact of the economy on our company," said Jeri Matheney, an Appalachian Power spokeswoman. "There are signs of recovery, but it could take several years to get back to the electric demand that we saw before the recession."
Matheney said AEP and Appalachian Power have many workers age 60 and older -- those most likely to accept a severance package.
The buyout pays two weeks of salary for every year of service, so veteran workers would stand to gain the most from the buyout.
"We have lots of people with 30 or 40 years of service," Matheney said. "For employees close to retirement, this could be just what they're looking for."
The offer has no age restriction, and all employees are eligible.
AEP workers have until April 30 to decide whether to accept a buyout. The company plans to determine whether more cuts are needed in May.
The terms of the separation agreement would be the same, no matter whether employees accept the buyout or get laid off.
"We're hoping we can accomplish what we need with the voluntary severance package," Matheney said. "But it could result in involuntary reductions. We're looking out how we can make every group within the company as efficient as possible,""
She said AEP has slashed costs by reducing its operating budget, cutting capital expenditures and freezing employee salaries over the past year.
"Although we've done a lot to reduce expenses, it's not enough," she said.
CHARLESTON, W.Va.-- American Electric Power plans to cut up to 2,200 jobs in 11 states, including West Virginia, through a buyout offer to employees, the company announced Wednesday.
The utility wants to shed 5 to 10 percent of its workforce, and warned that it may have to lay off workers if not enough employees accept the voluntary severances.
Appalachian Power, an AEP subsidiary, has 2,780 employees in West Virginia, so as many as 278 power company workers across the state could be affected.
"It's to address the impact of the economy on our company," said Jeri Matheney, an Appalachian Power spokeswoman. "There are signs of recovery, but it could take several years to get back to the electric demand that we saw before the recession."
Matheney said AEP and Appalachian Power have many workers age 60 and older -- those most likely to accept a severance package.
The buyout pays two weeks of salary for every year of service, so veteran workers would stand to gain the most from the buyout.
"We have lots of people with 30 or 40 years of service," Matheney said. "For employees close to retirement, this could be just what they're looking for."
The offer has no age restriction, and all employees are eligible.
AEP workers have until April 30 to decide whether to accept a buyout. The company plans to determine whether more cuts are needed in May.
The terms of the separation agreement would be the same, no matter whether employees accept the buyout or get laid off.
"We're hoping we can accomplish what we need with the voluntary severance package," Matheney said. "But it could result in involuntary reductions. We're looking out how we can make every group within the company as efficient as possible,""
She said AEP has slashed costs by reducing its operating budget, cutting capital expenditures and freezing employee salaries over the past year.
"Although we've done a lot to reduce expenses, it's not enough," she said.
The company notified employees of the buyout offer through an e-mail Wednesday morning and an Internet Webcast later in the day.
AEP last laid off employees about six years ago, Matheney said.
She said the company didn't have a specific number of employees that it expects to take the buyout in West Virginia.
Columbus, Ohio-based AEP has 22,000 employees in 11 states. Appalachian Power serves nearly 1 million customers in West Virginia, Virginia and Tennessee.
Customers have sharply criticized the company at recent public hearings as part of a state Public Service Commission investigation into widespread power outages in Southern West Virginia following the Dec. 18-19 winter storm.
Some people have alleged that Appalachian Power failed to keep power line rights-of-way properly cleared before the storm. Others have accused the power company of jacking up electric rates to pay for storm repairs. The company has denied the allegations.
State Senate Majority Leader Truman Chafin criticized AEP Wednesday, saying the company's "multi-millionaire" executives were making "improvident layoff decisions."
"Once again AEP, through their upper management, is demonstrating high disregard for the people of West Virginia as they continue their pattern and practice of dumping workers through buyouts and possible layoffs," said Chafin, D-Mingo. "It appears this corporate giant is only interested in their bottom line, or else they would be hiring and rehiring workers to maintain their power lines in southern West Virginia, especially with the spring vegetation in full bloom."
Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869.