Downsizing

"The short answer is 'yes'. . . . Utilities think they have to cut their costs in order to compete. The easiest way to cut costs is to downsize, get rid of people . . . which means they stop doing the work. And the result is a threat to the reliability of service.

"Pacific Gas & Electric (em this was back in 1994 (em the state commission [announced plans] to introduce competition, and PG&E reacted in a way that to cut costs, to lower their kilowatt-hour rate, was to cut out a lot of people.

"In early 1995, the company said they didn't get enough takers [for early retirement] and therefore they were going to institute layoffs. . . . Heavy storms occurred in early part of 1995 . . . finally the company called off those layoffs. I think then they began to realize some of the problems they were beginning to have, and, of course, they sat down and this is when we formed our partnership."

s Harmony

"What we did, it was like calling a truce to our war, and the company said, 'Look, we want to bring in an outside consultant in terms of maintenance,' and they brought us into that right away and we were part of interviewing those people. When they did their report, the report was announced to us simultaneously. Basically, the report was very critical of some of things that PG&E was not doing. Then, as a result of that, we have worked with them . . . so we have been workers as partners with PG&E, putting in place some maintenance programs and systems to take care of the distribution system. . . . They're bringing us in right at the beginning on a lot of these issues. It's a partnership."

s Working It Out

"[PG&E] is talking about performance-based ratemaking and if you set that up in a way that rewards the company for properly maintaining its system, then that's what our interest is because that's jobs.

"The area where we are going to have some problems is in the area of generation. . . . [The California Public Utilities Commission] wants them to divest all their generation. . . . I had suggested to them the idea of ESOPs, employee stock-ownership plans.

s The Future

"A unionized workforce can be cost-competitive. . . . This is the mutual gains approach to issues where we are working with

different committees, these

different departments, on how to be more competitive or be more cost-conscious." t

Jack McNally is business manager/ financial secretary of the International Brotherhood of Electrical Workers Union Local 1245, representing 20,000 members, including those at Pacific Gas & Electric and Sierra Pacific Power Co. He also is vice president and executive council member of the California State Federation of Labor.

s Downsizing

"I would say 'yes' . . . and the reason is because utilities are under such pressure to cut costs. All industries are. But we're not that different. Everybody's

downsizing. . . . Now the realization is there's a real dark side to that. And one of the dark sides is reengineering is a failure in 80 percent of the cases because you need the employees working with you. When you set your workforce in a turmoil, it will affect the quality of your product, whether you call it reliability, whether you call it customer service.

"There's no way we'll consider a massive downsizing. The only way we'll do that is through partnership with the union, through attrition, job retraining. . . . The day is gone when management will say 'another 300 out of the door.'"

s Harmony

"Let's take the IBEW, the electrical workers. They may be union, but they're super-professional. They live that job, they'll do anything to serve the customer, and they're incredibly knowledgeable. So when you sit around the table with the union and get their field knowledge, front-line knowledge, and you mix that with the technical knowledge that the professional engineer brings, you get a much better result."

s Working It Out

"We see eye to eye on system reliability. It's something you've got to maintain and actually improve. Customer expectations are going up all the time. . . . There's a lot less tolerance for 'momentaries' and outages, [also] infrastructure integrity. Union and management are very much aligned on those issues, and on serving the customer.

"Parting ways is solvable though a partnership. A classic one we had: automatic meter reading. Meter readers, of which we have 700, why would they help you do that? Because that's their job. So if you leave it there, you're going to part ways. Technology is good from management's perspective. It's not good from the union's perspective because it's jobs. You have to make the commitment that you'll retrain. . . . These are solvable things."

s The Future

"It could be absolutely horrendous. And I say if you haven't got a partnership with a union, you're in big trouble. . . . To the degree that you have a civil war with your own employees, your own union, you're just going to be incredibly vulnerable to being cherry picked. You have to learn how to talk to each other. We have actually brought in mutual bargaining training. . . . We make mistakes. You've got to fess up to them and say that was not right. Ask for forgiveness. Both sides. And if there's a genuine understanding and commitment, there's forgiveness. I tell you, it's not that different from a marriage." t

Robert J. Haywood is senior vice president and general manager of customer energy services at Pacific Gas & Electric Co., a 21,000-employee utility in San Francisco, CA. About 60 percent of the employees are union, mostly in the International Brotherhood of Electrical Workers. In customer energy services, as many as 80 percent of workers are bargaining unit employees.

s Downsizing

"It has [threatened reliability]

. . . . Some people have told me the new trend is 'You don't fix something unless it's broken.' So, consequently, preventative maintenance care, I believe, is not

being adhered to.

"Downsizing has taken some of the brightest and talented people, even among management and middle management, not just union people. Those people have left, leaving the system, I think, somewhat vulnerable. . . . In Boston, you have an old antiquated system, an underground system with somewhere around 13,000 to 15,000 manholes, built on the ocean. The people who know that system are really older workers. . . . I think [their leaving] hurts the system."

s Harmony

"We have been doing it for a number of years. . . . In 1986, we had a strike over at Boston Edison Co. over the whole issue of safety and health in the workplace. . . . Most of the issues dealt with things you would have thought the company would have wanted. . . . We tried to do it across the table at the collective bargain level.

"We had a tough underground system out there and we'd address the problems only when something broke. We had several fatalities during the 1980s that raised our level of consciousness to 'Act now rather than wait for these problems to happen.' Not only did this benefit the worker, it would benefit the customer.'"

s Working It Out

"On stranded investment, we're eye to eye on some things. Except that we believe if there is any stranded investment, it must include the stranded human investment of the workers.

"We haven't been eye to eye with companies on a lot of these issues because we haven't been sitting down and negotiating with them across the table. We are now becoming very outspoken on it, and setting up some strategies ourselves where we can work with companies. And we haven't defined all those places yet. Unfortunately, up to this point the only ones who have been heard from have been the proponents of competition, restructuring, deregulation."

s The Future

"Bargaining is going to be very difficult over the next several years unless management and companies can get together on this entire issue. The solution isn't downsizing their entire workforce. . . . In the utility industry, everybody agrees the cost of labor is probably the least-expensive cost. Labor is around 10 percent. So if you laid off half your workforce, that's not going to affect the electric bill at all. Both parties [need to] realize that if competition is here, we'd best prepare for it . . . . [The answer] may be in retrain-ing and doing things a little differently." t

Donald E. Wightman is national president of the Utility Workers Union of America/AFL-CIO, based in Washington, DC. The UWUA represents some 50,000 employees in the gas, water, and electric utility industries in the United States. Wightman has held office since January 5.

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