NEW YORK - Enron Corp. will dole out $140 million to 1,700 employees working for the bankrupt company in a move to dissuade them from bolting and taking jobs with competitors.
The retention bonuses, approved by a judge Tuesday, are crucial to Enron's plan to rebuild its business because employees have been leaving the company at a rate of more than 30 a week since January, Enron officials say.
``We are losing the most talented employees,'' said Daniel Leff, the chief executive of Enron Energy Services, called as a witness by an Enron lawyer at a hearing in Manhattan's U.S. Bankruptcy Court.
Under the ruling, U.S. Bankruptcy Judge Arthur Gonzalez, placed several conditions on the retention plan.
Gonzalez expanded the role of an examiner appointed to oversee an Enron unit to give him authority to monitor the allocation of the bonuses and severance.
He also agreed, to at the urging of creditors and the Securities and Exchange Commission, to stipulate that the recipients cannot be defendants in lawsuits related to the energy trader's collapse or named as wrongful actors in the Powers report.
The report was the internal Enron probe that partially blamed the company's downfall on its executives, board of directors, auditors and others.
Also, beneficiaries would have to sign affidavits saying they haven't committed insider trading and that if they commit any misdeeds they would be forced to forfeit the money.
Enron wants to pay up to $90 million in bonuses to 122 senior managers and employees working on asset sales. The payments would be funded with 1 percent of the revenue generated by those sales, which executives estimate could reach $9 billion.
Additional retention bonuses of up to $40 million would be paid to more than 900 others involved in day-to-day operations.
The company proposed a new severance package that would be based on years of service, with a maximum of eight weeks base pay and a minimum of $4,500. Total severance would not exceed $7 million.
Enron was also granted the right to pay certain legal expenses for directors and officers still with the company.
Houston-based Enron has cut about 4,500 workers since Dec. 2, when it filed for bankruptcy to reorganize the company.
Tuesday
July 8th, 2025
5:54PM
