CEG » Topics » Workforce Reduction Costs

This excerpt taken from the CEG 8-K filed Feb 22, 2010.

Workforce Reduction Costs

 

In the first quarter of 2009, we recorded charges in connection with certain workforce reductions primarily in connection with the divestiture of a majority of our international commodities operation.  Fourth quarter activity primarily reflects the impact of the year-end true-up of the tax benefit recorded on charges recorded earlier in the year based on our estimated annual effective income tax rate.

 

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Constellation Energy Group and Subsidiaries

This excerpt taken from the CEG 8-K filed Oct 30, 2009.

Workforce Reduction Costs

 

In the first quarter of 2009, we recorded charges in connection with certain workforce reductions primarily in connection with the divestiture of a majority of our international commodities operation.  Third quarter activity primarily reflects the impact of a change in our estimated annual effective tax rate at Sept. 30, 2009, requiring us to reduce the income tax benefit recognized in connection with charges recorded in the first half of the year.

 

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Constellation Energy Group and Subsidiaries

This excerpt taken from the CEG 8-K filed Jul 31, 2009.

Workforce Reduction Costs

 

In the first quarter of 2009, we recorded charges in connection with certain workforce reductions, primarily in connection with the divestiture of a majority of our international commodities operation.  Second quarter activity primarily resulted from a change in our estimated annual effective tax rate at June 30, 2009, requiring us to adjust the income tax benefit associated with the first quarter charges.

 

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Constellation Energy Group and Subsidiaries

These excerpts taken from the CEG 10-Q filed May 8, 2009.

Workforce Reduction Costs

We incurred workforce reduction costs during the quarter ended March 31, 2009 primarily related to the divestiture of a majority of our international commodities operation as well as some smaller restructurings elsewhere in our organization. We recognized a $10.8 million pre-tax charge in 2009 related to the elimination of approximately 180 positions. We expect all of these restructurings will be completed within the next 12 months.

        We incurred costs related to workforce reduction efforts initiated at our Customer Supply operations in

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2008. The following table summarizes the status of the involuntary severance liability at March 31, 2009:

   
 
  (In millions)
 

Initial severance liability balance

  $ 2.5  

Amounts recorded as pension and postretirement liabilities

     
   

Net cash severance liability

    2.5  

Cash severance payments

    (2.0 )

Other

     
   

Severance liability balance at March 31, 2009

  $ 0.5  
   

        We also incurred costs related to workforce reduction efforts initiated across all of our operations in 2008.

        The following table summarizes the status of this involuntary severance liability at March 31, 2009:

   
 
  (In millions)
 

Initial severance liability balance

  $ 19.7  

Amounts recorded as pension and postretirement liabilities

    (3.0 )
   

Net cash severance liability

    16.7  

Cash severance payments

    (5.8 )

Other

    (0.2 )
   

Severance liability balance at March 31, 2009

  $ 10.7  
   

        We discuss our 2008 workforce reduction costs in more detail in Note 2 of our 2008 Annual Report on Form 10-K.

Workforce Reduction Costs

During the quarter ended March 31, 2009, we incurred workforce reduction costs primarily related to the divestitures of a majority of our international commodities operation as well as some smaller restructurings elsewhere in our organization. We recognized a $10.8 million pre-tax charge in 2009 related to the elimination of approximately 180 positions. We expect all of these restructurings will be completed within the next 12 months. We discuss our workforce reduction costs in more detail in the Notes to Consolidated Financial Statements beginning on page 13.

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Results of Operations for the Quarter Ended March 31, 2009 Compared with the Same Period of 2008

In this section, we discuss our earnings and the factors affecting them. We begin with a general overview, then separately discuss earnings for our operating segments. Significant changes in other income and expense, fixed charges, and income taxes are discussed, as necessary, in the aggregate for all segments in the Consolidated Nonoperating Income and Expenses section on page 54.

Workforce Reduction Costs

Our merchant energy business recognized expenses associated with our workforce reduction efforts as discussed in more detail beginning on page 13 in Notes to Consolidated Financial Statements.

This excerpt taken from the CEG 8-K filed May 5, 2009.

Workforce Reduction Costs

 

We recorded charges in connection with certain workforce reductions primarily in connection with the divestiture of a majority of our international commodities operation.

 

This excerpt taken from the CEG 8-K filed Feb 18, 2009.

Workforce Reduction Costs

 

We recorded charges in connection with the restructuring of our merchant energy segment’s retail customer supply workforce approved in September 2008 and a broader restructuring of our workforce across all of our operations in December 2008.

 

This excerpt taken from the CEG 10-Q filed Nov 10, 2008.

Workforce Reduction Costs

In September 2008, our merchant energy business approved a restructuring of the workforce at our Customer Supply operations. We recognized a $2.2 million pre-tax expense during the quarter ended September 30, 2008 related to the elimination of approximately 100 positions associated with this restructuring. We discuss our workforce reduction costs in more detail in the Notes to Consolidated Financial Statements on page 16.

This excerpt taken from the CEG 10-Q filed Aug 11, 2008.

Workforce Reduction Costs

We incurred costs related to workforce reduction efforts initiated in 2006 and 2007. We discuss these costs in more detail in Note 2 of our 2007 Annual Report on Form 10-K.

        We substantially completed both of these workforce reduction efforts in the first half of 2008.

This excerpt taken from the CEG 10-Q filed May 9, 2008.

Workforce Reduction Costs

We incurred costs related to workforce reduction efforts initiated in 2006 and 2007. We discuss these costs in more detail in Note 2 of our 2007 Annual Report on Form 10-K.

        The following table summarizes the status of the involuntary severance liability, initiated in 2006, for Nine Mile Point and Calvert Cliffs at March 31, 2008:


 
 
(In millions)
 
Initial severance liability balance1 $ 19.6  
Amounts recorded as pension and postretirement liabilities   (7.3 )

 
Net cash severance liability   12.3  
Cash severance payments   (11.2 )
Other    

 
Severance liability balance at March 31, 2008 $ 1.1  

 

1 The severance liability above includes $1.6 million of costs that the joint owner of Nine Mile Point Unit 2 reimbursed us.

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        The following table summarizes the status of the involuntary severance liability, initiated in 2007, for Nine Mile Point at March 31, 2008:


 
 
(In millions)
 
Initial severance liability balance1 $ 2.6  
Amounts recorded as pension and postretirement liabilities   (1.5 )

 
Net cash severance liability   1.1  
Cash severance payments   (0.1 )
Other   (0.1 )

 
Severance liability balance at March 31, 2008 $ 0.9  

 

1 Includes $0.3 million to be reimbursed from co-owner.

These excerpts taken from the CEG 10-K filed Feb 27, 2008.

Workforce Reduction Costs

The portions of the costs associated with our Voluntary Special Early Retirement Program and workforce reduction programs that relate to BGE's gas business are deferred as regulatory assets in accordance with the Maryland PSC's orders in prior rate cases. As a result of a 2005 gas base rate case, the remaining regulatory assets associated with workforce reductions totaling $7.3 million as of December 31, 2005 are being amortized over a 3-year period that began in January 2006. These remaining regulatory assets were previously amortized over 5-year periods beginning in January and February 2002.

Workforce Reduction Costs



The portions of the costs associated with our Voluntary Special Early Retirement Program and workforce reduction programs that relate to BGE's gas business are deferred as
regulatory assets in accordance with the Maryland PSC's orders in prior rate cases. As a result of a 2005 gas base rate case, the remaining regulatory assets associated with workforce reductions
totaling $7.3 million as of December 31, 2005 are being amortized over a 3-year period that began in January 2006. These remaining regulatory assets were previously amortized
over 5-year periods beginning in January and February 2002.



This excerpt taken from the CEG 10-Q filed Nov 8, 2007.

Workforce Reduction Costs

During the nine months ended September 30, 2007, our merchant energy business recognized expenses, net of reimbursement from co-owners, of $2.3 million associated with our workforce reduction efforts at our Nine Mile Point nuclear facility. We discuss the workforce reduction in more detail in the Notes to Consolidated Financial Statements on page 12.

This excerpt taken from the CEG 10-Q filed Aug 8, 2007.

Workforce Reduction Costs

During the quarter ended June 30, 2007, our merchant energy business recognized expenses of $2.3 million associated with our workforce reduction efforts at our Nine Mile Point nuclear facility. We discuss the workforce reduction in more detail in the Notes to Consolidated Financial Statements on page 12.

This excerpt taken from the CEG 10-Q filed May 10, 2007.

Workforce Reduction Costs

We incurred costs related to workforce reduction efforts initiated in 2006. We discuss these costs in more detail in Note 2 of our 2006 Annual Report on Form 10-K.

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The following table summarizes the status of the involuntary severance liability for Nine Mile Point and Calvert Cliffs at March 31, 2007:

 

 

(In millions)

 

Initial severance liability balance

 

 

$

19.6

 

 

Amounts recorded as defined benefit obligations

 

 

(7.3

)

 

Net cash severance liability

 

 

12.3

 

 

Cash severance payments

 

 

(5.8

)

 

Other

 

 

 

 

Severance liability balance at March 31, 2007

 

 

$

6.5

 

 

 

This excerpt taken from the CEG 10-K filed Feb 27, 2007.

Workforce Reduction Costs

The portions of the costs associated with our Voluntary Special Early Retirement Program and workforce reduction programs that relate to BGE’s gas business are deferred as regulatory assets in accordance with the Maryland PSC’s orders in prior rate cases. As a result of a 2005 gas base rate case, the remaining regulatory assets associated with workforce reductions totaling $7.3 million as of December 31, 2005 are being amortized over a 3-year period that began in January 2006. These remaining regulatory assets were previously amortized over 5-year periods beginning in January and February 2002.

This excerpt taken from the CEG 10-Q filed Nov 9, 2006.

Workforce Reduction Costs

During the nine months ended September 30, 2006, our merchant energy business recognized expenses associated with our workforce reduction efforts at our nuclear facilities. We discuss the workforce reduction programs in more detail in the Notes to Consolidated Financial Statements on page 12.

This excerpt taken from the CEG 10-Q filed Aug 8, 2006.

Workforce Reduction Costs

During the six months ended June 30, 2006, our merchant energy business recognized expenses associated with our workforce reduction efforts at our Ginna facility. In addition, in July 2006, we announced a restructuring of the workforce at our Nine Mile Point nuclear facility. We discuss these programs in more detail in the Notes to the Consolidated Financial Statements on page 12.

This excerpt taken from the CEG 10-Q filed May 9, 2006.

Workforce Reduction Costs

Our merchant energy business recognized expenses associated with our workforce reduction efforts at our Ginna facility as discussed in more detail in the Notes to the Consolidated Financial Statements on page 11.

This excerpt taken from the CEG 10-K filed Mar 3, 2006.

Workforce Reduction Costs

During 2003, we recorded $2.1 million in pre-tax expense, or $1.3 million after-tax, of which BGE recorded $0.7 million pre-tax, associated with deferred payments to employees eligible for the 2001 Voluntary Special Early Retirement Program.

This excerpt taken from the CEG 10-Q filed Nov 9, 2005.

Workforce Reduction Costs

As a result of the workforce reduction efforts initiated in 2004, in the third quarter of 2005 we were required to record a pre-tax settlement charge of $3.9 million for one of our qualified pension plans under SFAS No. 88, Employers' Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits. We discuss the workforce reduction efforts initiated in 2004 in more detail in Note 2 of our 2004 Annual Report on Form 10-K. The $3.9 million charge reflects recognition of the portion of deferred actuarial gains and losses associated with employees who were terminated as part of the restructuring or retired in 2005 and who elected to receive their pension benefit in the form of a lump-sum payment. In accordance with SFAS No. 88, a settlement charge must be recognized at the point in time when lump-sum payments exceed annual pension plan service and interest cost, which occurred in the third quarter.

This excerpt taken from the CEG 10-K filed Mar 11, 2005.

Workforce Reduction Costs

During 2002, we incurred costs related to workforce reduction efforts initiated in the fourth quarter of 2001 as discussed in this note and additional initiatives undertaken in the third quarter of 2002. We discuss these costs in more detail below.

Costs associated with 2001 Programs

In 2002, we recorded $63.7 million of net workforce reduction costs associated with our 2001 workforce reduction initiatives as discussed below. The $63.7 million included $50.8 million recognized as expense, of which BGE recognized $33.8 million. The remaining $12.9 million was recognized by BGE as a regulatory asset related to its gas business as discussed in Note 6.

    We recorded $52.9 million when 308 employees elected the age 50 to 54 Voluntary Special Early Retirement Program (VSERP).
    We reversed $17.8 million of the $25.1 million involuntary severance accrual that was recorded in 2001 to reflect the employees that elected the age 50 to 54 VSERP. Ultimately, we involuntarily severed 129 employees that resulted in a total cost for the involuntary severance program of $7.3 million.
    We recorded $29.6 million of settlement charges related to our pension plans under SFAS No. 88, Employers' Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits. These charges reflect the recognition of actuarial gains and losses associated with employees who have retired and taken their pension in the form of a lump-sum payment. Under SFAS No. 88, the settlement charge could not be recognized until lump-sum pension payments exceeded annual pension plan service and interest cost, which occurred in 2002.
    We recorded a $1.6 million expense associated with deferred payments to employees eligible for the VSERP.
    Partially offsetting these costs, we reversed approximately $2.6 million of previously accrued workforce reduction costs primarily as a result of the reversal of education and outplacement assistance benefits we accrued that employees did not utilize to the extent expected.

        In 2002, we completed the 2001 workforce reduction programs. Accordingly, no involuntary severance liability recorded under EITF 94-3 remained at December 31, 2002.

Costs associated with 2002 Programs

In 2002, we recorded $12.0 million of expenses for anticipated involuntary severance costs in accordance with EITF 94-3 associated with new workforce reduction initiatives as follows:

    We recorded $8.5 million for workforce reduction costs for the severance of 120 employees at Calvert Cliffs Nuclear Power Plant (Calvert Cliffs).
    We recorded $1.6 million of workforce reduction costs for the severance of 27 employees in our information technology organization. BGE recorded $0.6 million of this amount.
    We recorded $1.9 million of workforce reduction costs for the severance of 20 employees in our legal organization. BGE recorded $0.9 million of this amount.

        At December 31, 2002, the involuntary severance liability recorded under EITF 94-3 for our 2002 workforce reduction programs was $12.0 million.

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