Removed BG&E workers allowed jobless benefits

December 14, 1993|By Ross Hetrick | Ross Hetrick,Staff Writer

Workers for Baltimore Gas and Electric Co. whose jobs have been eliminated may draw state unemployment benefits even though they continue to receive wages and benefits from the utility company.

That ruling, which will affect hundreds of BG&E workers, was made by the Board of Appeals for the Department of Economic and Employment Development, the three-member panel that decides unemployment payment issues.

The decision also could boost BG&E's unemployment taxes since a company's rates are partly determined by its number of layoffs.

BG&E has not decided whether to appeal the decision to the Baltimore Circuit Court, said company spokeswoman Peggy Malloy. But in a prepared statement, the company said the board's decision was "premature" because the workers are still on the payroll, and they still have the chance of being rehired.

Eligible BG&E workers will receive benefits starting this week, said John McGucken, legal counsel for the Office of Unemployment Insurance for DEED.

If the board's ruling is overturned, workers may have to pay back the unemployment benefits through a payment plan or as a deduction from future benefits, Mr. McGucken said.

The board said that even though the workers continue to receive wages and benefits, their jobs have been abolished and the payments are a form of "dismissal payments or wages in lieu of notice." Under Maryland law, workers whose jobs are abolished can get benefits even if they get "dismissal payments," the board said.

The BG&E program is "extremely generous," the board noted, "but the legislature has clearly chosen to be generous also to those whose jobs have been permanently lost."

The decision was signed by the board's chairman, Thomas W. Keech, and its associate members, Donna Watts and Hazel Warnick.

Even though the decision only applied directly to four workers, the ruling will be used for guidance in other BG&E cases, the decision said.

Since the average annual wage at BG&E is $41,000, the affected workers would receive the maximum benefit of $223 a week for 26 weeks.

BG&E is implementing a restructuring program that probably will result in the first layoffs in its 177-year history. Unlike layoffs at other companies, BG&E is offering months of job-searching services to displaced workers who continue to receive wages and benefits.

At a Dec. 3 hearing, BG&E attorney L. Ellis Justis argued that these workers do not officially become "displaced" workers until Jan. 1. That is when the clock starts ticking on a four-week period during which employees must decide whether to take a lump-sum severance package or stay in the job search program for a specific period.

BG&E has refused to say how many jobs will be eliminated to meet its goal of trimming $46 million from its annual expenses.

Mr. Justis also said that many of the tentatively displaced workers may be called back after the company determines how many of the 1,400 employees eligible for early retirement take the offer. The deadline for that choice is tomorrow at midnight.

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