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www.DukeEmployees.com - Duke Energy Employee Advocate

Duke - Page 8

"We can't vote for this kind of stuff.” – NC Sen. David Hoyle on ethics reform legislation

$1.6 Billion for Duke Energy Asbestosis Claims

Employee Advocate – www.DukeEmployees.com – November 11, 2006, 2006

Duke Energy employees have said that the company is slow to settle asbestosis claims. And when the initial settlement offer finally comes, it always seems to be on the chintzy side.

Asbestosis victims feel the prevailing attitude is: “There is just no money to pay asbestosis claims, now run along and play in traffic.”

But last year the Wall Street Journal reported that Duke Energy has $1.6 Billion available to pay asbestosis claims. This amount includes the proceeds from a finite-risk insurance policy purchased by Duke Energy and reported to the Securities and Exchange Commission.

The policy was purchased from XL Capital Ltd., of Bermuda. Duke Energy and XL Capital both refused to provide any details to the Journal.

It turns out that finite-risk insurance policies are being probed by the Securities and Exchange Commission. Finite-risk insurance policies were promoted during the decade of greed – the 1990’s. Some of these hybrid policies are said to hide liabilities by classifying loans as insurance.

Duke’s $1.6 Billion for Asbestos Claims

First Duke Energy Pension Hearing

Employee Advocate - www.DukeEmployees.com - November 8, 2006

The first Duke Energy cash balance plan hearing was held Tuesday, Oct. 7, 2006 at the United States District Court in Greenville SC. The purpose was to consider Duke Energy’s motion for a change of venue to the Western District of North Carolina.

The court heard arguments from both sides, but no decision was reached on Tuesday. Clients of Wallace and Graham will receive an update by mail when a decision is made.

Duke Energy Cash Balance Pension Lawsuit

Late 2006 Duke Energy Waiver

Employee Advocate – www.DukeEmployees.com – November 4, 2006, 2006

Duke Energy is once again allowing some employees to volunteer to be laid off. Anyone considering signing the waiver below would be foolish not to consult an attorney beforehand. WALLACE & GRAHAM, P.A., 1-800-849-5291, has assisted employees with similar waivers. A slightly different waiver exists for former Cinergy employees. - Employee Advocate.


Before signing the Waiver and Release in order to receive severance benefits, you should be aware that a proposed class action is pending in federal district court in South Carolina. It alleges violations of the Age Discrimination in Employment Act and the Employee Retirement Income Security Act (“ERISA”) arising out of the conversion of the Duke Power Company Employees’ Retirement Plan into the Duke Power Company Retirement Cash Balance Plan and the administration of the Duke Energy Cash Balance Retirement Plan. The plaintiffs seek to represent a proposed class defined as “all present and/or former employees of Duke Energy who participated in the Duke Energy Retirement Cash Balance Plan on or after January 1, 1997.” The case is entitled George et al. v. Duke Energy Cash Balance Retirement Plan and Duke Energy Corporation, Case No. 806-cv-00373-HFF (“George”). Please note that if you sign and do not revoke the Waiver and Release within the specified time, the Company will take the position as specified in paragraph 7 of the Waiver and Release that you have waived your potential claims and damages in that lawsuit. THE COMPANY STRONGLY ADVISES YOU TO CONSULT LEGAL COUNSEL BEFORE SIGNING THE WAIVER AND RELEASE. The lawyers who filed the class action are as follows:

James R. Gilreath
William M. Hogan
110 Lavinia Avenue
P. O. Box 2147
Greenville, SC 29602
(864) 242-4727

Charles W. Whetstone, Jr.
Cheryl F. Perkins
1303 Blanding Street (29201)
P. O. Box 8086
Columbia, SC 20202
(893) 799-9400

Mona Lisa Wallace
525 North Main Street
Salisbury, North Carolina 28144
(704) 633-5244

Carl F. Muller
Andrew B. Cogburn
Wallace Lightsey
44 East Camperdown Way
Greenville, SC 29601
(864) 242-8200

A. Hoyt Rowell, III
Daniel O. Myers
T. Christopher Tuck
Robert S. Wood
P.O. Box 1007
Mt. Pleasant, SC 29465
(843) 727-6500


____________________________________ Name

____________________________________ Employee ID Number

[Note: The term "Company" in this Waiver and Release Form includes Duke Energy Corporation (“Duke Energy”) and all of its affiliated companies (“Affiliates”), which shall consist of any other corporation, or other entity in which Duke Energy Corporation holds, directly or indirectly, an 80% or greater ownership interest. “Company” also includes any employee benefit plan established or maintained by Duke Energy or any of its Affiliates, and any administrator, trustee, fiduciary, or service provider of any such plan.]

1. I understand that the Company has established "The Duke Energy Reorganization Severance Benefits Plan (PN 564)” (the "Plan") for eligible employees who satisfy all of the Plan's requirements for entitlement to Plan benefits, including the execution of this Waiver and Release (or other waiver form acceptable to the Company). The Severance Payment and other benefits of this Plan will be provided at Company expense and are in addition to the regular salary and benefits package to which I am otherwise entitled as an employee. I acknowledge that I have notified the Company of my decision to volunteer to terminate my employment with the Company under the Plan, and that the Company accepted my decision.

2. I acknowledge that I have received and read a copy of the Plan document and Summary Plan Description. I also acknowledge that the Company has provided me with written information identifying: a) any class, unit, or group of individuals covered by the Plan, any eligibility factors for the Plan, and any time limits applicable to the Plan; and b) the job titles and ages of all individuals eligible or selected for the Plan, and the ages of all individuals in the same job classification or organizational unit who are not eligible or selected for the Plan.

3. I understand that, under the terms of the Plan, if I sign and do not revoke this Waiver and Release, I will receive a Severance Payment in an amount equal to *******************, subject to withholding for taxes and other lawful purposes, as well as outplacement services, up to Two Thousand Six Hundred Dollars ($2,600.00) in education reimbursements, and I will be eligible for COBRA or retiree group health premium payments made on my behalf for up to six (6) months. I understand that in order to receive the Severance Payment, as well as the other benefits described in this paragraph, I must enter into and sign this Waiver and Release.

4. I understand that I have until ****************, 2006, a date that is at least forty-five (45) days from the date I received this form, in which to consider whether to sign and enter into this Waiver and Release. I understand that I may not sign and enter into this Waiver and Release before the termination of my employment with the Company. I understand that in order to become entitled to the benefits under the Plan, I must return this signed Waiver and Release to *****************************, by that date, *****************, 2006. I FURTHER UNDERSTAND THAT THIS SIGNED WAIVER AND RELEASE WILL NOT BE ACCEPTED AFTER THIS DATE.

5. In exchange for my becoming entitled to receive the Severance Payment and other benefits under the Plan, I voluntarily and knowingly waive any and all claims and rights which I might have arising out of or related to my employment with the Company and/or the termination of my employment with the Company. I also voluntarily and knowingly release the Company, its directors, officers, employees, agents, and other representatives from any and all liability and damages, including but not limited to liquidated damages, arising in any manner whatsoever out of my employment and the termination of that employment. This Waiver and Release includes, but is not limited to, claims and rights under: a) the Civil Rights Act of 1991 and Title VII of the Civil Rights Act of 1964, as amended; b) the Age Discrimination in Employment Act of 1967, as amended (29 U.S.C. § 621, et seq., "ADEA"); c) the Older Workers Benefit Protection Act of 1990, as amended; d) the Americans with Disabilities Act; e) the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), including but not limited to fiduciary claims; f) any other federal, state, or local law or regulation, including any law or regulation concerning discrimination based on race, sex, color, religion, national origin, citizenship, age, handicapped or disabled status, and Vietnam era veteran's status; g) the Worker Adjustment and Retraining Notification Act or any other federal, state, or local law or regulation relating to notification of any plant or business closing or employee layoff; h) and any express or implied term or condition of my employment with the Company, including any claim for wrongful discharge, breach of contract, or claim for compensation. This Waiver and Release does not waive rights and claims that may arise after the date I sign this form, nor any pending or future claims to Workers’ Compensation benefits.

6. I understand that by signing this Waiver and Release, I do not waive and release any rights and claims to any benefits due to me under the terms of any employee retirement benefit plan maintained by the Company in which I am a participant. The specific application of the Waiver and Release to my benefits under the Duke Energy Retirement Cash Balance Plan (“Cash Balance Plan”) is explained in paragraph 7 below.

7. SPECIAL PARAGRAPH RELATING TO CLASS ACTION LITIGATION. You may or may not know that a class action lawsuit was commenced on February 6, 2006. Here is the caption of that case: Kenneth Walton George, Dennis Reed Bowen, Clyde Freeman, George Moyers, Jim Matthews, and Henry Miller, on their own behalf and on behalf of a class of persons similarly situated v. Duke Energy Retirement Cash Balance Plan and Duke Energy Corporation, Case No. 8:06-CV-00373-HFF, pending in the United States District Court for the District of South Carolina. This paragraph deals with that lawsuit, and any lawsuit asserting similar claims (the “Cash Balance Plan Litigation”). The Cash Balance Plan Litigation seeks additional benefits under the Cash Balance Plan, and other relief.

The Company and the Cash Balance Plan intend to defend themselves vigorously in the Cash Balance Plan Litigation and take the position that no damages should result from the litigation. You should consider the Cash Balance Plan Litigation in connection with this Waiver and Release, because the Company and the Cash Balance Plan will take the position that this Waiver and Release completely releases your rights in the Cash Balance Plan Litigation.

In the event that a court in the Cash Balance Plan Litigation should rule that despite this Waiver and Release you are entitled to some recovery of benefits under the terms of the Cash Balance Plan, you agree that you will get only the difference, if any, between what you have been paid under this Waiver and Release and what you would get under that ruling. In the event that a court in the Cash Balance Plan Litigation should rule that despite this Waiver and Release the Company or the Cash Balance Retirement Plan must pay damages other than benefits under the Cash Balance Plan, you agree that you will get only the difference, if any, between what you have been paid under this Waiver and Release and what you would get under that ruling.

You are free to consult with counsel representing the plaintiff class in the Cash Balance Plan Litigation whose names and addresses are set forth on the attached Notice. You may, of course, contact any other lawyer. You are encouraged to discuss this matter with the lawyer of your own choosing.

8. I understand that nothing in this Waiver and Release prohibits me from reporting any suspected instance of illegal activity of any nature, any nuclear safety concern, any workplace safety concern, or any public safety concern to the United States Nuclear Regulatory Commission, the United States Department of Labor, or any other federal or state governmental agency. I further understand that this Waiver and Release does not prohibit me from participating in any way in any state or federal administrative, judicial, or legislative proceeding or investigation or filing a charge of discrimination with an administrative agency. I understand that should an agency pursue any claims on my behalf, by signing and not revoking this Waiver and Release, I have waived my right to any monetary recovery.



11. It is understood by you and the Company that if any part of this Waiver and Release is held by a court to be invalid, the remaining portions shall not be affected.

12. I sign this form signifying my agreement with the understandings and acknowledgments listed and with the intent to be bound by this Waiver and Release and with the intent that this Waiver and Release will be binding upon me, my executors, administrators, heirs, successors, and assigns.

Positive Layoff Echoes

Ruth Shaw Will Not Leave Broke

Employee Advocate – www.DukeEmployees.com – October 28, 2006, 2006

When Ruth Shaw retires on April 30, 2007, she will not leave broke, according to the 10/27/06 Duke Energy Form 8-K SEC filing.

Ruth Shaw will receive:

  • a lump sum payment equal to two times her annual base salary and target annual bonus,

  • a lump sum payment equal to the anticipated premiums that she will pay for continued medical, dental and life insurance coverage for a period of two years,

  • a lump sum payment equal to the contributions that she would have received or accrued under the Company's retirement plans had she continued employment for an additional two years,

  • continued vesting of certain equity awards for a two-year period, and

  • a pro-rated target annual bonus for the 2007 period.

Also, Ruth Shaw will get $25,000 a month for three years for consulting for two years.

The Duke Energy Corporation 2006 Long-Term Incentive Plan reserved 60,000,000 shares of stock to spread money among executives and directors in the form of:

  • stock options,

  • stock appreciation rights,

  • restricted shares,

  • performance shares,

  • performance units,

  • phantom stock,

  • stock bonuses and

  • dividend equivalents.

Fred J. Fowler’s short-term incentive opportunity will be 90% of his $950,000 annual base salary.

His long-term incentive opportunity will be 220% of his annual base salary

2005 Duke Energy Executive Pay

Duke Energy and Electric Deregulation

Employee Advocate – www.DukeEmployees.com – October 16, 2006

Electric deregulation has not produced a drop in rates, the opposite has occurred, according to the New York Times. Any initial savings due to deregulation were artificial and part of the ploy to sucker people into the game. When the meger, artificial rate reductions expired, ratepayers often faced devastating price increases.

Temporary artificial controls always make matters worse. At some point, the customer has to pay for the true cost of production. And, the customer will pay for any past free rides. The Federal Energy Regulatory Commission (FERC) and other agencies have acknowledged this fact in a report to Congress. The report stated that “customers may experience rate shock” as utilities make up for revenue lost due to price controls.

Baltimore ratepayers were in for a whopping 72 percent rate increase! The state legislature called a special secession, due to the public outcry. The rate increase will now be phased in over several years. The state is using price controls to shield the public from the fallout of previous price controls. But all price controls can do is delay the inevitable increased cost of electricity due to deregulation.

Illinois ratepayers are looking at a 55 percent rate increase. Connecticut rates rose 27 percent last year and may go up 50 percent more in January! Last year, New Jersey rates rose 13 percent and the end is not in sight.

Connecticut Attorney General Richard Blumenthal said the supposedly competitive market has been “a complete failure and colossal waste of time and money.”

Some who once supported deregulation, now see it as a failure. The Cato Institute said “We recommend total abandonment of restructuring.”

Under electric regulation, utilities did the work of producing power and made the profits. Someone is always scheming on ways to make the profit without doing the work. Deregulation was the vehicle for making profits without producing anything. The Enron “casino” demonstrated how the game was to be played. Enron produced nothing – nothing but outrageous profits. Other companies were drooling to get in on the Enron gravy train of no work and huge profits.

Duke Energy dove, head first, into energy trading and Enron emulation. The twist was that Duke Energy intended to actually produce electricity and also to make huge profits from trading it. The then Duke Energy CEO was much, much more interested in trading electricity than producing it. In fact, he found the production of electricity to be an embarrassment. He even refused to attend any meeting with analysts that only included utility CEO’s.

The End of Mr. Priory’s Fun Ride

It did not take energy trading companies long to figure out that the huge profits could be increased by manipulating the market. Energy trading offered endless opportunities to rig the market. Money appeared almost as if by magic. It’s no wonder the energy traders had a field day. FERC Spokesman Bryan Lee said that Congress only gave the commission the legal tools to punish manipulators last year.

Then the Enron bubble burst. Enron’s great profits were found to be phony. It should have been obvious to anyone that the energy trading boondoggle was going to wash out. But Duke Energy did not have a clue. The CEO was elated at the opportunity to become the new Enron. Duke Energy was lucky to escape with its life, many companies did not. The Duke Energy CEO then began to disparage Enron, the very company he had sought to emulate. Ironically, it was Duke Energy’s power production that saved the company from possible annihilation.

Grey Poupon with Your Crow?

In 1996, then FERC Chairwoman Elizabeth A. Moler said the deregulation rules “will benefit the industry and consumers to the tune of billions of dollars every year.”

Deregulation mainly benefited energy CEO’s and politicians. When energy trading crashed, the CEO’s left with all their bonuses for producing paper profits. The politicians enjoyed large campaign contributions from energy companies for passing deregulation laws. Affected customers will pay for the deregulation fiasco for years to come.

Deregulation also benefited a certain global investment firm, the Carlyle Group. Its chairman is none other than Louis V. Gerstner, the former IBM chairman and CEO, who forced a cash balance plan on the employees. IBM employees face bleak retirement futures, but Gerstner left the company with megabucks. The Carlyle Group has $44.3 billion under management. Former President George H. W. Bush has served on the Board of Directors and retired from Carlyle in October 2003.

The Empty Promise of Deregulation

Duke Energy Wants Customers to Take All the Risk

Employee Advocate – www.DukeEmployees.com – October 13, 2006

Duke Energy wants customers to take all the risk associated with pursuing more nuclear power plants. Progress Energy wants the same deal.

The News & Observer reported: “North Carolina's utilities want an unprecedented guarantee: that their customers will pay for the companies' risky gamble in new nuclear plants -- even if the new reactors don't get built.”

Duke Energy seeks to raise rates in North Carolina to cover $87.5 million to be spent on applying for a federal license to build two more nuclear reactors in South Carolina. Duke Energy also wants it South Carolina customers to kick in $37.5 million. The new reactors are expected to cost between $4 billion and $6 billion.

After the 1979 partial meltdown at Three Mile Island, Duke Energy canceled building six reactors. Duke wants its customers to pick up the tab for any such future cancellations. If the N.C. Utilities Commission doesn’t play ball, Duke Energy intends to lobby for a special law to pass liability to its customers.

Robert Gruber, Public Staff director, said that North Carolina law doesn't allow utilities to recover up-front investment in power plants that aren't built. He added: “I'm very concerned they're trying to shift all the risk to the rate payers. The company might make a bad risk assessment and can't get the license. Why should the rate payer pay for it?”

Congress has already offered $2 billion in taxpayer’s guarantees for each of the first six reactors that are built.

Duke Energy Exec Benefits From Options Timing

Employee Advocate – www.DukeEmployees.com – October 12, 2006

This article was published by The Charlotte Observer on 10/12/06:

by Christopher D. Kirkpatrick and Binyamin Appelbaum

Paul Anderson decreed in 2003 he wouldn't accept a salary or bonus as the new chief executive of Duke Energy Corp., but would instead tie his fortunes to those of the company's shareholders.

He was granted 1.1 million options to purchase stock, meaning he would profit only if the company's share price increased during his tenure. But the options weren't issued until Nov. 17, 16 days after his Nov. 1 start date, pumping up the potential value by $902,000.

Anderson had worked for Duke until 1998, when he left to run an Australian energy company. He returned five years later, vowing changes at the struggling Charlotte utility.

Options are the right to buy shares in the future at a fixed price. Most grants to executives are made at the stock price on the day of the grant.

Duke says the profitable timing was coincidental. Anderson said he had no control over the grant's issue date. But the day chosen was unusual in a few ways:

  • The Nov. 17 grant date was not tied to his Nov. 1 start date or to a regularly scheduled compensation committee meeting, common dates for grants to new executives. Instead, Anderson's grant was approved during a special conference call of committee members.

  • During the fortnight and few days following his first day on the job, the stock dropped 4.45 percent to $17.45 a share. Tagging his options to that lower price added the $902,000 to the potential value.

  • The compensation committee that negotiated the unusual stock-only deal was scheduled to meet on Dec. 16. If it had waited to issue the options at that time, the potential value of the grant would have been reduced by $1.86 million. That's because the stock price increased in the interim, lowering Anderson's potential profit.

Duke says it needed the 16 days in November to negotiate the pay package. The company also noted its policy of granting options by using the higher price between that day's close and the previous day's close, ensuring the grant is less advantageous to the executive.

The Observer is looking at how Carolinas companies grant stock options because of revelations that some companies falsified the dates of grants to increase the value, a practice known as backdating.

Duke's grants to senior executives over the last decade showed no such pattern of lucrative timing. The company granted options on 11 dates. Six times, the stock price fell over the next month. Five times, it climbed.

The company properly reported all compensation expenses.

But the timing of Anderson's grant illustrates how lawful decisions about timing can still increase the value of a grant.

Though stock options are becoming less popular, experts agree that adhering to a set schedule for awarding them is the best method.

The Duke committee met when the stock was trending downward and trading at its lowest point in months.

The chairman of the compensation committee at the time, Leo Linbeck Jr. of Houston, said Monday he doesn't remember the particulars of scheduling the Nov. 17 meeting. But he said his committee never made compensation decisions based on stock price.

"It's inconceivable to me that we would have waited to see if the stock went down in order to somehow enhance compensation," he said from his Texas home.

Another committee member, former N.C. Gov. Jim Martin, said he and his fellow directors did not have a crystal ball and could not predict which way the stock would move. He said the pay package amounted to a risk taken by Anderson.

"It was a very ingenious method and well received by the market," he said. "At that time, we would not have known that the stock would go up. The only thing we would have known at the time is that it could have been fortuitous or infortuitous."

Current CEO James Rogers also has a stock-based pay package.

He took over Duke Energy after its $9 billion merger with Cinergy Corp. was completed this year. He was awarded 1,877,646 options to purchase stock the day after his April 3 start date, according to a regulatory filing. A new Duke Energy board met April 4 and approved the options at $29.14, the closing price that day.

The current compensation chairman, James Hance, former chief financial officer and vice chairman of Bank of America Corp., said the timing of Anderson's grant was not "a big deal."

"I really think (the stock price) could go either way," he said. "I think you have to price it when you approve it. You can't just pick dates. I think that's been some of the problems of backdating."

Anderson led turnaround

Anderson took over a company in the doldrums, looking to cut budgets and redefine itself. He oversaw the merger with Ohio's Cinergy and brought Duke Energy back to its roots as mainly a power company. Over his two-year tenure as CEO, the stock price steadily increased. It now consistently trades in the $30-and-above range. Today, Anderson would make about $14.6 million by exercising the grant.

Anderson, now the chairman, can exercise his options only after Jan. 1, 2007, his scheduled time to leave the company. Even so, Anderson hasn't been cash-poor; he has received the equivalent of dividends, $754,650 last year. He also received $324,170 in other compensation last year, including $199,246 for the cost of his and his wife's personal use of company aircraft.

In addition to his options, Anderson stands to receive millions in restricted stock after he leaves the company. The value of his stock and options last year was more than $9.1 million, according to a regulatory filing.

In an interview, Anderson said the fortuitous timing of his options grant in November 2003 was the innocent byproduct of negotiations during a hectic time. He was retired and in Australia in October 2003, when Duke asked him to take over, he said.

"They basically called me up and said, `Would you come and be CEO of the company? And we want to move very fast. ...' " he said. "Usually, you're talking six months or so. This was a situation where we thought it would be best for the shareholders and for the customers and the employees to not leave things in limbo."

He said tax and other issues had to be settled, such as how he would pay for health care premiums without a traditional paycheck. The premiums could not be automatically deducted, he said.

"The contract was complicated by the fact that I would not be getting any cash," he said.

Anderson said he had no control over when the compensation committee decided to convene the special Nov. 17 meeting.

Anderson and the company spent from Nov. 1 to Nov. 13 that year constructing the stock-only pay package, said Pete Sheffield, a Duke spokesman. On Nov. 13, a Thursday, the contract was completed, Sheffield said. Linbeck, as chairman, had to approve holding the special meeting ahead of the already-scheduled Dec. 16 meeting. The committee members, including Martin, convened a conference call to approve the package, Sheffield said. Anderson pointed out that waiting for stock options cuts both ways.

When he left Duke in 1998 to head an Australian energy and mining company, there also was a delay in issuing his options as head of BHP Billiton Ltd. The potential value of his options was reduced by more than $2 million because the package had to be approved by a shareholder vote, he said.

"I lost several million dollars," he said. "I guess this is God trying to make up for half of what I lost at BHP."

2005 Duke Energy Executive Pay

Employee Advocate – www.DukeEmployees.com – September 24, 2006

Below is the 2005 compensation for Duke Energy executives, according to The Charlotte Observer:

Fred Fowler, president and COO:
Salary: $755,496
Bonus: $1.1 million
Restricted Stock: $1.2

Jimmy Mogg, VP and chief development officer:
Salary: $519,996
Bonus: $735,758
Restricted Stock: $1.6 million

David Hauser,VP and CFO:
Salary: $519,996
Bonus: $735,758
Restricted Stock: $649,891

Ruth Shaw, president and CEO of Duke Power:
Salary: $510,000
Bonus: $667,253
Restricted Stock: $637,557

Ms Shaw will retire in April, but will still have Duke Energy checks rolling in. She will be a consultant, with undisclosed duties and undisclosed compensation. She will still be under Duke Energy’s control.

Jim Mogg has retired, according to the Charlotte Business Journal.

Board Chairman Paul Anderson does not get paid in cash, but in stock. But the stock paid him a cash dividend of $754,650 in 2005. His compensation was $9.9 million.

What if Duke Energy told Paul Anderson that he was not really going to get what was promised to him? What if the company said it was now catering to the "young, mobile chairman" crowd and was going to give him a reduced “cash balance compensation” amount? Mr. Anderson would sue Duke Energy before another word was said. Unlike the employees forced into the cash balance pension plan, he has an enforceable contract.

Executives get contracts that specify the amount of compensation. Employees get lies.

Duke Energy Executive Pay for 2006

Duke Energy Worships Elizabeth Dole

Employee Advocate – www.DukeEmployees.com – September 22, 2006

The Republican senator from NC, Elizabeth Dole, has done everything possible to ensure that the pensions of American workers go to corporate executives. Earlier this year, she and junior sidekick, Sen. Richard Burr, wrote a letter urging the retroactive legalization of cash balance pension plans. Such legislation would have been a get-out-of-jail-free card for corporations facing pension lawsuits, such as Duke Energy and IBM. The retroactive portions of the pension bill did not pass, much to the dismay of Dole and Burr.

Evidently NC corporations really appreciate such pension plundering efforts. The Charlotte Chamber of Commerce announced that Elizabeth Dole will be named the 2006 Citizen of the Carolinas. Dole and Burr also voted to repeal the estate tax, which would benefit only the very wealthiest of citizens. By the way, Duke Energy will pick up the tab for the award. Duke Energy knows that money spent on a politician is not really spent – it is invested.

Elizabeth Dole Flounders

Duke Energy Tinkers with Cash Balance Plan

Employee Advocate – www.DukeEmployees.com – September 13, 2006

Tuesday, Duke Energy informed employees that the cash balance plan would be enhanced. But the miniscule changes are hardly worth calling an enhancement.

Non-Union former Cinergy employees, who wisely kept the traditional pension plan, will be able to volunteer for the Duke cash balance plan. If the workers steered clear of the losses associated with the Cinergy pension conversion, why in the sam hill would they want to volunteer for the Duke Energy cash balance plan?

Starting 1/1/07, Vested employees who leave the company prior to age 55 will be able to take their pension cash balance with them. Cash balance plans are touted as being so great because worker can take the balance with them when they leave. But Duke Energy keeps the employees’ pension money until they turn age 55. Duke gets to keep the difference between the cheap cash balance interest rate and the actual return on the employees’ invested money.

PricewaterhouseCoopers, Audit Thyself!

Employee Advocate – www.DukeEmployees.com – September 1, 2006

The accounting firm, PricewaterhouseCoopers, appears to be having problems auditing its own books, according to Bloomberg News. PricewaterhouseCoopers audits the books for large corporations and sells them cash balance pension conversions.

Anyone involved in cash balance plans bears watching. And, it so happens that the IRS is watching PricewaterhouseCoopers. The firm is in the business of auditing others, but the IRS is auditing PricewaterhouseCoopers for potential violations in reporting its own taxes. That should really give all its clients a warm fuzzy feeling!

What specifics is the IRS scrutinizing? This is the good part – the PricewaterhouseCoopers cash balance plan! PricewaterhouseCoopers peddles cash balance plans, but cannot even keep its own nose clean!

The Duke Energy cash balance conversion occurred in 1997. The PricewaterhouseCoopers’ conversion came one-year later. PricewaterhouseCoopers then set up a cash balance conversion for Bank of America that was similar to its own plan. These are corporate titans. PricewaterhouseCoopers is the world’s largest accounting firm and Bank of America, based in Charlotte, North Carolina, is the second-largest bank in the US.

In March, the IRS found that the Bank of America cash balance plan violated tax laws. The IRS determined that the cash balance plan conversion and 401 (k) push took away benefits that employees had already earned. Does this sound vaguely familiar?

Former employee Timothy Laurent sued PricewaterhouseCoopers over the use of the cash balance plan as a tax shelter. It was charged that the cash balance plan manipulation enriched the partners, but left employees with less than their full pensions. Again, does any of this sound familiar?

Corporations with blood on their hands just cannot get away from Enron. The auditing industry had been watched closely since the 2001 crash of energy trading Enron and its auditor, Arthur Andersen.

Pension attorney Richard Susko said “If the pension plan were to be disqualified, the results would be potentially nuclear”

Grant Thornton CEO Edward Nusbaum said “In general, accounting firms don't get audited. I know we have not been audited.''

Grant Thornton is the outside auditor that determined that Duke Energy underreported $124 million in profits from 1998 to 2000.

Duke Shielded From Rate Review

Greasing the Legislative Wheels

Employee Advocate – www.DukeEmployees.com – August 30, 2006

Duke Energy sought to be exempt from North Carolina air regulations and be allowed to make a special pollution swap at its Cliffside power plant. It's nothing unusual for a corporation to ask for ridiculous favors. But the interesting part is that the special Duke Energy exemption sailed through both NC chambers with no problems. Duke Energy is now licensed to spew out extra pollution.

One could not help but wonder if there was more to the story.

The Raleigh News & Observer reported yesterday that the Duke Energy political action committee (PAC) made about $59,000 in political contributions to NC legislators prior to the request. Specifically, the Duke Energy PAC gave money to 23 senators and 31 House members. Only about $35,000 was given to politicians during the same period in 2004.

Paige Sheehan, Duke Energy spokesperson, said "Clearly, Duke is a large corporate citizen and our employees may wish to have their voice heard. We work on lots of legislative issues throughout the year. Our contributions are not tied to any particular piece of legislation."

Commissioner Paid by Duke Energy is Sentenced

Four Duke Energy Contractors Injured

Employee Advocate – www.DukeEmployees.com – August 29, 2006

Wednesday, four Duke Energy contractors received burns, according to WFIE 14 News. Two workers required hospitalization; one was flown to a burn unit.

The injuries occurred while the employees were cleaning coal ash out of a boiler at an Indiana power plant.

OSHA Fine for Bucket Truck Death

Northwest Offers Dumpster Diving Tips

Employee Advocate – www.DukeEmployees.com – August 23, 2006

Northwest Airlines really felt the pain of employees soon to be laid-off, according to the Associated Press. Northwest sent workers a handbook for coping with being laid-off. The handbook included 101 money-saving ideas for laid-off employees.

The handbook included such gems as:

"Don't be shy about pulling something you like out of the trash."

Down and out former employees were urged to use old newspapers for cat litter! Who needs a job when they can save big money on cat litter? Employees facing the axe were advised to solicit friends and family for old clothes. Another tip was to ask doctors for free prescription drug samples.

The impending layoff, combined with the “helpful tips for the down and out,” brought Jackie Diebel to tears. She said "They want us to sell our cars, our houses, go to food banks for food for our families."

Bryan Dalzell, with 27 years of service, said "It came across to us, after losing our jobs after a lifetime of work, as patronizing and rather insulting."

Bobby De Pace, president of a International Association of Machinists district, said "How condescending to tell people to move to a cheaper place to live and if you go on a date to take a walk in the woods. Give me a break. This is one of the worst things about how they treat their employees in the worst of times."

Northwest was so proud of its money-saving ideas that it also posted them on its internal website.

Employees were so outraged that Northwest removed the dumpster diving tips from the handbook and from its website.

The Northwest tips remind one of the booklet of “Economical Health Tips,” which Duke Energy kept available in its medical clinics. The basic advice was “Don’t ever go to the doctor.”

But what if you end up dead from being too cheap to go to the doctor? Well, you win some and you lose some, but in the end you will be saving cool cash! And one thing about dead people, they are low maintenance.

Executive Health Care

Cracking Down on Lobbyists?

Employee Advocate – www.DukeEmployees.com – August 21, 2006

Do you want to hear a good one?

North Carolina has banned campaign donations from lobbyists, according to The Charlotte Observer.

That might sound like a good idea to the incredibly naive. But as long as these professional sycophants are drawing a breath, they will find a way to get the money to the politicians. The law, which goes into effect Jan 1, has loopholes that one could float a battleship through. For one, the law does not ban money from political action committees (PAC’s). Lobbyist “A” cannot give money to lawmaker “B,” so he gives it to PAC “C.” PAC “C” then gives the money to lawmaker “B.” And, lobbyists are free to “advise” PAC’s on who to give the money to. Also, nothing stops lobbyists from holding fundraisers for politicians and candidates.

The law will be as effective as one that bans lobbyists from shoving money into a politician’s right, front pocket. Nothing stops the money from going into the left pocket, hip pockets, or shirt pocket.

But when the ethics package was being debated, some NC politicians protested even this flimsy barrier against corruption. NC Sen. David Hoyle was outraged at any hint of slowing the flow of slop to the public trough. Sen. David Hoyle said "We can't vote for this kind of stuff. It will do irreparable damage to this institution."

NC Sen. David Hoyle Can’t Abide Ethics Reform

But the NC politicians needed to look like they were trying to reduce corruption. So, the ethics package passed 109-1 in the House and 46-1 in the Senate. But even some of the politicians that voted for the package are drumming up all the money they can get from lobbyists, before the law goes into effect! They voted for the ban, but are now breaking their necks to get money while the getting is good.

Lobbyists have told the Observer that at least 30 NC politicians have recently hit lobbyists up for money! Some politicians said that they were going to follow the law when it becomes active. That’s great! Some lawmakers are actually going to follow the law that they passed!

The Black and Decker (not the power tool company) Scandal

You know this weak ethics package would not have been passed unless someone was caught with their hand in the cookie jar. Yes, there was a black sheep in the NC House – Jim Black, that is. The News & Observer reported that Former N.C. Rep. Michael Decker admitted receiving a legislative job for his son and $50,000 for supporting Jim Black for a third term as House speaker in 2003. He has pleaded guilty to a single of charge of conspiracy to extort, commit mail fraud and launder money.

Decker switched parties to help Black maintain his role as House speaker. Swapping parties created a 60-60 split in the House and Black kept his role as co-speaker. Afterwards, Decker received an envelope containing $12,000 in cash and $38,000 in checks. Maybe this pair should be manufacturing power tools instead of laws.

Jim Black’s former aide, Meredith Norris, pleaded no contest to charges of breaking lobbying laws. She was charged with working as an unregistered lobbyists to get a lottery in North Carolina. She was receiving $5,000 a month from Scientific Games for her lobbying. She was sentenced to probation, fines, and community service.

Former lottery commissioner Kevin Geddings was charged with helping Norris with her illegal lobbying. Geddings was indicted on nine federal counts of mail or wire fraud. He was appointed by Jim Black.

Last year, the Carolina Journal reported that N.C. Department of Transportation Secretary Lyndo Tippett operated a $5 million slush fund for Jim Black and Senate President Pro Tem Marc Basnight.

This month, Superior Court Judge James Spencer Jr. ruled that Jim Black violated state law and must forfeit $6,800 in contributions from optometrists. Black and the N.C. Optometric Society collected checks with blank “payee” lines. Black later decided who got what, and then filled in the payee lines.

The weak ethics reform attempt in NC is more than the US Congress has accomplished since the Jack Abramoff lobbying scandal. US lawmakers face the same dilemma as the NC lawmakers. Most of them want of look like they are doing something, without actually curtailing the flow of cash and favors.

USA Today quoted Minority Leader Nancy Pelosi, as calling the bill "a ruse." She said "It is an embarrassingly trivial response to the culture of corruption that has thrived under the Republican Congress."

Rep. John Boehner, the lobbyists best friend, is not about to let anything too strenuous pass. Boehner opposed an end to lobbyists-paid travel and and lobbyists-paid lunches. Rep. Boehner admitted his close ties to lobbyists and even boasted of his "good relationship" with them.

As the article linked below points out, meaningful reform can never occur, as long at there is a Boehner in the henhouse!

A Boehner in the Henhouse

Wal-Mart ‘Chairman’ Blasts Jews, Arabs and Koreans

Employee Advocate – www.DukeEmployees.com – August 20, 2006

Wal-Mart cannot stay out of the news, and most of it is bad. Wal-Mart is the poster child for cheapskate pay and benefits. It is fun to watch big corporations get into trouble because of their own conduct, and then try to wiggle out of it. They seldom fix the real problems. They always seem to go for a quick, spin doctor type of fix. The corporations have not figured out that the “I’m not a crook” defense never works.

I Am Not a Crook

Wal-Mart decided to “manage” its public image by hiring a big name spokesperson, according to the New York Times. Wal-Mart’s cheap stunt was doomed to failure from the start. The spokesperson lasted a mere 6-months before going down in flames!

Wal-Mart hired civil rights activist, former UN rep., and former mayor of Atlanta Andrew Young as its chairman of Working Families for Wal-Mart. His job was to spew out happy talk, spin doctor, trumpet accomplishments (if any) and generally make everything all better for Wal-Mart.

So, how did the Wal-Mart “token of goodwill” work out? Andrew Young told The Los Angeles Sentinel that Jewish, Arab and Korean shop owners had "ripped off" urban communities for years, "selling us stale bread, and bad meat and wilted vegetables."

The goodwill chairman seemed to be on a roll. What other gems did he have to impart?

Andrew Young said “You see those are the people who have been overcharging us and they sold out and moved to Florida. I think they've ripped off our communities enough. First it was Jews, then it was Koreans and now it's Arabs."

It’s all clear now. Wal-Mart does not really pay cheap wages, have crummy benefits, and engage in union-busting; everything’s really the fault of those Jews, Koreans, and Arabs!

Young apologized for his remarks, and less than an hour later, he resigned as chairman of Working Families for Wal-Mart.

How did Wal-Mart work damage control? By rolling out another spokesperson to disclaim the remarks made by the first spokesperson. The damage control spokesperson noted “We also support his decision to resign."

Duke Energy tried the same tactic to “win over” employees, after it had raided their benefits. Duke figured a token figurehead would make employees forget all about their missing pension and other benefits. It sounds unbelievable, but that’s how the corporate types think. They think everything can be spin doctored away.

In 2000, Duke Energy hired Jacqui Gates as the “first vice president for diversity and ethics.” Duke wanted a shill, who could be programmed to spew out mindless babble, and basically stay out of the way. But Ms Gates proved to be anything but a controllable token; she believed in improving conditions for employees. She told employees that if Duke Energy did not intend to follow through with its talk, her “bags were always packed.”

Jacqui Gates left Duke Energy in 2002. Enough said? Another cheap employee relations stunt failed.

Jacqui Gates Leaves Duke

When Duke Energy was head over heels in lawsuits and market manipulation charges, it blamed everything on the press! Duke decided to start manufacturing its own news and bought ads in The Wall Street Journal. The ads were dumber than dumb. Another epic spin doctoring failure.

An employee sent this comment in to the June 2002 Noon Meeting: “The company is spending a lot of money on Wall Street Journal ads that are boring, depressing, drab and stodgy and they completely lack energy. If we are indeed trying to turn our stodgy image around, I can't imagine that these ads are helping.”

Wal-Mart Follows Duke

OSHA Fine for Bucket Truck Death

Employee Advocate – www.DukeEmployees.com – August 16, 2006

The Occupational Safety and Health Administration (OSHA) fined the tree-trimming service used by Duke Energy over the death of Carlos Flores, according to the Cincinnati Post. The 21-year old employee of ABC Professional Tree Services was killed in a fall from a bucket truck in June.

Duke Energy Contractor Killed in Accident

The investigation was conducted at Duke Energy’s Glen Estate substation. It determined that the out-riggers had not been extended before the truck was tested. ABC lawyers plan to appeal the $5,000 fine.

Another Duke Energy contractor was killed in a bucket truck accident this month.

Another Duke Energy Bucket Truck Death

Duke Energy Ordered to Surrender Trading Tapes

Employee Advocate – www.DukeEmployees.com – August 11, 2006

Duke Energy is still paying a price for the years spent aspiring to be like Enron. Lawsuits, fines, and market manipulation charges have abounded. A judge ruled Tuesday that Duke Energy and over a dozen other energy companies must provide the court with hundreds of hours of gas trading tapes, according to the Los Angles Times.

Attorney Nanci Nishimura said "This is quite significant, because the defendants have been so resistant to producing these tapes…a window into understanding what these traders did and it goes to intent and motive in their conduct."

There are charges of “round trip” gas trading. Duke Energy has previously admitted to round trip trading in the power market.

Bluster and Sacrificial Employees

Another Duke Energy Bucket Truck Death

Employee Advocate – www.DukeEmployees.com – August 9, 2006

WIS News 10, Columbia, SC, reported that another Duke Energy contractor has been killed because of a bucket truck failure. James Rogers Gentry of Ninety Six fell 50 feet to his death. He had worked on the job for over twenty years.

The tree trimming fatality occurred about 1:30 Monday afternoon. The state Labor Department is investigating the case, and an autopsy was scheduled for Tuesday.

A Duke Energy contractor was also killed in June when a bucket truck failed:

Duke Energy Contractor Killed in Accident

In July, a Duke Energy employee suffered burns to over half of his body when a truck boom touched a 44,000-volt power line. But Duke is not letting out a lot of information about that incident.

Duke Energy Employee Suffers Burns

2006 Employee Opinion Survey

Employee Advocate – www.DukeEmployees.com – August 8, 2006

Most Duke Energy employees will get an opportunity to complete the 2006 Employee Opinion Survey. If you get the chance, by all means do it!

Many workers refuse to fill out any survey because they feel it is a waste of time. But there are three reasons to consider taking the survey:

  1. You will feel better after expressing you opinions – especially if you write in comments.

  2. Duke Energy will have more difficulty using the big lie “We haven’t heard any complaints.”

  3. Believe or not, there are some honest people in management that really want to do the right thing. For years their voices were suppressed by the day-trading, quick profit boys. Your feedback could provide the needed leverage for ethical people to regain control of the company.

Below is feedback already offered in the 2006 Duke Energy Employee Opinion Survey:

Values and Integrity: Cash Balance Pension Conversion

Duke Energy’s executives, past and present, have tried to downplay the damage inflicted upon employees by the cash balance pension conversion. But employees fully understand that their deferred compensation was sacrificed, to fund executive bonuses.

Duke Energy has steadfastly refused to rectify the cash balance injustice, thereby forcing employees to take the matter to federal court. Company lobbying efforts, through the American Benefits Council, failed to get cash balance plans retroactively legalized. Only new cash balance plans have been legalized. So, the company will have to answer for ignoring ERISA laws.

But even in new cash balance conversions, “wear away” has been declared illegal. Wear away was only one of the ways that Duke Energy took pension money from workers. Eliminating the early retirement benefit was another way employees were shortchanged.

Duke Energy employees wish that they had never heard of a cash balance plan. Before the final chapter is written, Duke Energy may wish that it had never heard of a cash balance plan.

Other Topics: Zero Injuries Safety Culture

Duke Energy continues to preach safety and has even proclaimed that there will be zero injuries, deaths, or sicknesses on the job. In spite of these grandiose claims, people are still forced to work 12 hour a day, for a minimum of six days in a row, during outages. An abundance of studies prove that accidents increase and productivity suffers when long hours are worked.

But the Zero Injuries Safety Culture is like the Code of Business Ethics and the Duke Energy Charter. It is a hollow program; it is only window dressing. It is ignored when there is a chance to squeeze another dollar of profit from overworked employees.

Senior Leadership and Management

Paul Anderson and Jim Rogers are head and shoulders above their immediate predecessors. They have not failed by creating new problems. They have failed only by clinging to the mistakes of their inferior predecessors.

Duke Energy raided employees’ benefits for no good reason, other than greed. Until the benefits issue is resolved, a clean break can never be made with Duke Energy’s unethical past.

2005 Employee Opinion Survey

Duke Energy’s Coal Mining Disaster

Employee Advocate – www.DukeEmployees.com – July 30, 2006

This article, by Erik Reece, was published in The Nation (July 17, 2006 issue):

Harlan County Blues

Almost every day in Kentucky, we learn a little more about what killed five Harlan County miners in May. We've learned that cheap foam seals, opposed by the United Mine Workers of America (UMWA), allowed for a buildup of methane in the mine and may also have been to blame for the explosion at the Sago mine in West Virginia. And we've learned that the seals were improperly built and coated with a sealant that wasn't approved for mine use.

Still, the majority of miners at both Sago and the Darby No. 1 mine in Harlan survived the initial blasts. They died because their self-rescuers held only an hour's worth of oxygen. In the late 1990s the Mine Safety and Health Administration (MSHA) proposed installing more caches of oxygen inside the mines. But the Bush Administration, under former mining executive David Lauriski, withdrew that idea in September 2001, calling it cost-prohibitive.

Back in 1997, as general manager of Energy West Mining Company, Lauriski lobbied MSHA to raise fourfold the amount of coal dust allowed in underground mines. Once installed to oversee the agency, he began pushing the proposal again. The irony here is obscene: A man put in charge of enforcing federal mine safety decided to put miners at much greater risk of contracting black lung disease, purely in the name of profit for his former employer. Another bitter irony is that the thirtieth anniversary DVD of Barbara Kopple's documentary Harlan County U.S.A. was released the same week the Harlan County miners died. The confluence of these events is cause for reflection.

Kopple's Oscar-winning documentary chronicles a thirteen-month strike at the Brookside Mine in Harlan County, Kentucky. In 1973 the Brookside miners joined the UMWA, but Duke Power refused to accept a union contract. The miners went out on strike, and an escalating fight ensued between gun thugs hired by Duke Power and the men and women on the picket line. Finally, a Duke Power employee shot miner Lawrence Jones in the face one night and Jones died at the hospital. On the elegy "Lawrence Jones," from the extraordinary reissued and expanded soundtrack, Harlan County U.S.A.: Songs of the Miner's Struggle (Rounder), Bela Fleck plays a haunting banjo as Phyllis Boyens sings:

There's blood upon your contract like vinegar in your wine
'cause there's one man dead on the Harlan County line.

Sensing the violence and bad press about to be unleashed, the company quickly started negotiations with the union miners.

That's the bones of it. But Harlan County U.S.A. is hardly a straightforward narrative. Kopple's genius is to reveal slowly--through backstory, testimony, archival footage and music--the political, historical and economic forces that led to this long standoff in one of the country's poorest places. "In Harlan County, all our lives we've been kicked around," a miner tells a room full of Duke Power shareholders toward the middle of the strike. Fundamentally, Harlan County U.S.A. is a portrait of a community tired of being kicked around and grasping for the means to kick back.

While the Brookside strike did end in a union contract, it proved to be a minor victory for labor. Today, there's not a single union mine in Harlan County. And yet as Roger Ebert said on a panel last year at Sundance (one of the extras on the new DVD, along with commentary by Kopple, singer Hazel Dickens and Matewan director John Sayles), Harlan County U.S.A. "is more important today than it was then." Now as then, the odds of forcing large coal companies to do the right thing remain long. For one reason, the people of central Appalachia live in steep, remote mountains, and the media's interest in them rarely reaches beyond hillbilly stereotypes (Kopple's empathy for the miners and their wives--her refusal to see them as clichés--is one of the film's many virtues). In addition, the Kentucky and West Virginia state legislatures were long ago bought off with coal money. This year in Kentucky a bill to stop burying mountain streams with coal waste never got out of committee--in a state where 95 percent of headwater streams have been contaminated by mine waste, according to the EPA. And finally, there's the $100,000 that Massey Energy donated to the Republican Senate Campaign Committee, headed by Kentucky Senator Mitch McConnell. In large part because McConnell is married to Labor Secretary Elaine Chao, the coal industry has poured more than $9 million into Republican coffers during the past four years. In return, according to a Knight-Ridder survey, MSHA under the Bush Administration has issued fewer and smaller fines, has collected on less than half of these fines and has cut 100 mine-safety enforcement jobs.

"Distance negates responsibility," wrote my teacher Guy Davenport. In Harlan County U.S.A. Duke Power of North Carolina was the company exploiting Kentucky families from a clean distance. Today, many of the most dangerous and environmentally destructive mines in Appalachia are run by absentee owners like Peabody Energy in St. Louis, TECO Energy in Tampa and Massey Energy in Richmond, Virginia. Thirty years ago during the Brookside strike, the coal industry was posting record profits, as it is today. While industry profits rose 170 percent in 1975, miners' wages rose only 4 percent. Today, the issue isn't wages so much as safety. One might think the high price of coal would allow for needed improvements underground, but the opposite seems true.

Last fall, in a memo to employees, Massey Energy CEO Don Blankenship wrote, "If any of you have been asked by your group presidents, your supervisors, engineers or anyone else to do anything other than run coal (i.e., build overcasts, do construction jobs, or whatever) you need to ignore them and run coal." The opening scene of Harlan County U.S.A. shows a miner doing one such "construction job"--installing a support beam so he can work in a forty-two-inch shaft without its roof collapsing on him. But to Blankenship, the record profits mean that conveyor belts--like Midwestern meat-packing lines--must run even faster. According to the Pittsburgh Post-Gazette, a MSHA inspector tried to close part of a Massey mine in West Virginia in January because of a buildup of flammable coal waste along the mine's conveyor belt. But a superior told him to back off so the company could "run coal." On January 19 a fire broke out, killing two miners. Massey still refuses to cooperate in the investigation of their deaths. Thirty-seven more men have been killed in the mines since Blankenship issued his memo, largely because production has trumped safety. Regrettably, it has always taken high casualties to force our political hirelings to strengthen mine-safety laws. On June 15, with widows and other family members looking on, George W. Bush signed legislation that required more oxygen in the mines and more rescue teams. But whether MSHA will actually enforce the new law is another matter entirely.

That Elaine Chao has nominated former Massey executive Richard Stickler to replace David Lauriski as head of MSHA is not an encouraging sign. Also distressing is Bush's nomination of former Lauriski deputy John Correll to head the Office of Surface Mining. He was part of the Lauriski team that canceled or delayed eighteen mine-safety rules at MSHA. And Correll, no surprise here, also comes from the industry he might now be asked to regulate. It looks like the next two years will mean more toxic streams, deadly floods and mudslides, and oppressive coal dust for the communities below these strip mines. As a recent Lexington Herald-Leader editorial lamented, "It's probably too much to hope that Kentucky Sens. Mitch McConnell and Jim Bunning would put the interests of their constituents above those of the coal industry."

Which is to say, we do fatalism pretty well around here. When you watch entire ranges destroyed by mountaintop removal mining and hear constant stories of unsafe deep mines, it's hard not to expect the worst. One even senses it in the lyrics of pioneering folk songwriter Hazel Dickens as she sings over the closing credits of Harlan County U.S.A.:

The power wheel is rollin' rollin' right along
and the government will keep it goin' goin' strong.
So working people get your help from your own kind.
Your welfare ain't on that rich man's mind.

If the past six months have clarified anything, it is that life remains cheap in the coalfields, and many far-removed CEOs like it that way. Is it too much, then, to hope? At a recent commencement address here in Lexington, Nobel laureate and poet Seamus Heaney put it this way: Hope is not optimism, which expects things to turn out well, but "something rooted in the conviction that there is good worth working for." One sees few reasons for optimism these days, but the Bush Administration's incompetence and neglect in the face of human and environmental tragedies clearly reveals that there is much good work that now needs doing.

The Employee Survey Spin

Duke Energy Employee Suffers Burns

Employee Advocate – www.DukeEmployees.com – July 15, 2006

The Gaffney Ledger reported that the Duke Energy employee, who was injured on Wednesday, received burns to more than half of his body. A 44,000-volt power line made contact with the boom of the truck he was driving.

Duke Energy Employee Sent to Burn Center

NC Sen. David Hoyle Can’t Abide Ethics Reform

Employee Advocate – www.DukeEmployees.com – July 14, 2006

The North Carolina General Assembly is trying to pass ethics reform legislation, according to The Charlotte Observer. It is none too soon to instate ethics rules for NC lawmakers. They need strict rules as desperately as federal lawmakers need them. Both bodies seem willing to pass a sham bill, as long as it does not interfere with their take of tributes.

The NC House has already passed an ethics bill. But the prospect of laws that would restrict gifts, dampen conflicts of interest, and require financial disclosures has terrified some NC senators.

Sen. David Hoyle said "We can't vote for this kind of stuff. It will do irreparable damage to this institution."

Strict ethics laws would only strengthen the legislative body. Such laws would do “irreparable damage” to some senators’ feeding troughs. That’s what has David Hoyle in a tizzy!

David Hoyle has worked feverishly to destroy workers’ compensation benefits in North Carolina. Anything the corporations want, David Hoyle tries to deliver. He certainly does not want ethics reform to mess up his playhouse.

Last year, the Associated Press named Duke Power and Kelly-Springfield as two companies pushing to weaken workers compensation benefits for NC employees.

Mr. Smith Goes to Raleigh

Duke Energy Employee Sent to Burn Center

Employee Advocate – www.DukeEmployees.com – July 13, 2006

A Duke Energy employee was taken to the Augusta Burn Center Wednesday afternoon, according to WYFF. He was injured at the Gaston Shoals Hydroelectric Station in Cherokee County while performing work near high-voltage wires.

Man Electrocuted at Duke Energy Substation

Duke Energy Market Manipulation Lawsuit

Employee Advocate – www.DukeEmployees.com – July 12, 2006

The fallout continues from the days of chasing energy deregulation and trying to become another Enron. Duke Energy is facing a class-action lawsuit charging market manipulation, according to the Charlotte Business Journal.

The suit alleges that Duke Energy conspired with other corporations to fix the price of natural gas by repeatedly supplying bogus data.

Michael Whitney was a trader for Duke Energy Trading and Marketing during 2001 and 2002. He is charged in a Texas civil lawsuit of supplying false trading data to publishers.

The class-action lawsuit maintains that Duke Energy officers and directors "agreed to arrangements, contracts agreements and a combination and conspiracy which tended to prevent full and free competition or ... control the market prices of natural gas."

The Commodities Futures Trading Commission fined Duke Energy $28 million over price manipulation allegations in September 2003. Cinergy paid $3 million in fines.

Duke Energy executives declined to comment on the lawsuit.

Duke Energy Buys Lawsuits

Man Electrocuted at Duke Energy Substation

Employee Advocate – www.DukeEmployees.com – July 8, 2006

Friday, a man was electrocuted inside a Duke Energy substation, according to WYFF. The substation is located on West Washington Street in Greenville, SC.

Greenville County Deputy Coroner Ken Coppins said that the fatality occurred when the man came in contact with 7,200 volts of electricity.

Greenville County Sheriff’s Master Deputy Michael Hildebrand said that it appeared the man was attempting to steal copper wire. A Duke Energy employee found the body with wire and tools nearby.

Duke Energy Workers Smell a Rat

Duke Energy Workers Smell a Rat

Employee Advocate – www.DukeEmployees.com – June 27, 2006

This article was written by Paul Hill and published in the People's Weekly World Newspaper:

HOUSTON — A giant inflatable rat was the featured participant in a protest at Duke Energy headquarters here by members of Pipeline Workers Local 798. The workers came from Tulsa, Okla., to protest the unfair practices of Duke Energy contractor Sunland Construction. One pipeliner told the World that nonunion “rat” Sunland provides lower quality work than a union workforce, with worse worker safety.

Sunland, based in Eunice, La., has an abysmal record on working conditions and standards, the Pipeline Workers union says, including: “worker deaths on the job, alcohol and drug abuse, severe worker injuries, non-enforcement of safety policies, OSHA non-compliance, environmental infractions, community disregard, automotive accidents, unfair labor practice violations, high weld reject rates and shoddy workmanship.” The union asks, “Does Duke Energy care more about the //$Bottom Dollar$// than they do about safety?” and “Should Duke Energy hire contractors who have a poor record like this to build or repair high pressure natural gas pipelines?”

Protesters carried posters with pictures of injured workers. One showed a man in a coma after a pipe fell on him. Another was of a worker whose back was broken by a pipe. Other signs displayed copies of a May 17 newspaper article about the most recent worker death on the job.

The article, from the Smyth County, Va., News and Messenger, told the story of the May 15 death of Sunland worker David Lee Burrow, 45, of Pharr, Texas, who died after becoming trapped between a side crane dozer and his pickup truck.

The pipeline workers were joined by area union members and others who traveled from Texarkana, Texas, and as far as Washington, D.C., to express their solidarity. Workers passing by in a pickup truck waved their support. Some company officials passed by but were not nearly so friendly.

The peaceful event was monitored by a unit of the Houston Police Department mounted patrol. HPD brought a huge trailer with horses to the scene but they were kept a distance from the protest. The commercial media ignored this event, as usual.

Duke Energy Contractor Killed in Accident

Goodbye and Good Riddance to Lotus Notes

Employee Advocate – www.DukeEmployees.com – June 23, 2006

Duke Energy has finally decided to trash the clunky, bloated Lotus Notes e-mail program. But the company could not be happy with just eliminating the Notes millstone. All e-mail will now be deleted after two years. If you had retained e-mail, received three years ago, that could instantly solve a problem – too bad. The system would have deleted it.

“Saving storage space” always provides a ready excuse deleting company records. But storage space is one of the cheapest commodities going today.

“Saving storage space” does have a better ring to it than “destroying potential evidence.”

“We were just following company policy” can offer plausible denial for obliterating company documents.

Tip: Save your e-mail outside of Lotus Notes before the system gobbles it up. Keep a copy outside of the company.

Duke Energy Contractor Killed in Accident

Employee Advocate – www.DukeEmployees.com – June 21, 2006

Duke Energy Contractor Killed in Accident - photo 9News

Carlos Flores, 21, died 6:30 Monday morning after a fall involving a bucket truck, according to the Associated Press and WCPO 9News. The accident was investigated by the Occupational Health and Safety Administration.

The fatality occurred in Clermont County at Old State Route 74 and Schoolhouse Road in Union Township.

Employees said the bucket had almost reached its maximum height when the bucket tipped and the victim fell to the pavement. He fell 20 feet and was declared dead at the scene.

Duke Energy informed employees that the victim was a tree trimming contractor for Duke Energy Ohio. He was performing safety checks on the bucket truck before it left the Glen Este Substation in Cincinnati when the accident occurred.

Duke Energy Contract Worker Killed on the Job

June 8 Duke Energy Pension Hearing Canceled

Employee Advocate – www.DukeEmployees.com – June 6, 2006

A number of employees had expressed an interest in attending the June 8 Duke Energy pension hearing in Greenville, SC. But the court has informed our attorneys that the hearing has been canceled.

Duke Energy Contract Worker Killed on the Job

Employee Advocate – www.DukeEmployees.com – May 19, 2006

A Duke Energy contract employee was killed at work Monday, according to the Smyth County News & Messenger. David Lee Burrow was crushed between his pickup truck and a side crane dozer, on a pipe laying job.

This is not the only recent fatality on a Duke Energy job. An employee died inside a reactor building at a nuclear plant. This fatality was not directly related to an accident. But working inside a reactor building always puts added stress on the workers, especially in the four compactly designed reactor buildings. Employees must climb up, climb down, or crawl to get where they are going. In a medical emergency, extrication from a reactor building is a nightmare. The temperature is usually too hot, and during refueling outages, the tight space is overcrowded. If a tool is dropped, it can ricochet for a while before hitting the floor - or hitting someone.

Once a Duke Energy executive boasted that he and his safety steering committee were going to eliminate all on the job injuries, sickness, and deaths. This executive has never even seen some of the hazardous places that employees must work.

Fatal Accident at Duke Energy Development

The Duke Energy Name Game

Employee Advocate – www.DukeEmployees.com – May 14, 2006

In the beginning there was The Southern Power Company. Then came Mill Power Supply Company. It became Duke Power Company. Over the decades, Duke Power achieved an outstanding reputation with the public and with its employees. In the 1990’s there was an inside coup by Duke Power executives with a Machiavellian bent. They intended to dominate the world energy market by cutting employee benefits to the bone and engaging in high-risk operations.

As part of the master plan, PanEnergy was acquired. Duke Power then became Duke Energy. But all the subsidiaries did not carry the Duke Energy name. There was Duke Energy and dozens of alphabet soup named subsidiaries. Power generating Duke Power became Duke Energy, but it was still called Duke Power.

The executives’ vision was to be like Enron. Wheeling and dealing was the order of the day. At one point, 50 % of profits came from trading derivatives. Duke Energy was caught up in the California energy scandal. Lawsuits were stacking up like cordwood. Duke Energy’s reputation plummeted with the public and with employees. California customers did not like seeing their power bills quadruple. Employees did not relish seeing benefits, that had already been earned, vanish. Duke Energy blamed all its problems on the press, refusing to acknowledge any of its own mistakes.

Most of the day-trader type executives were finally flushed from the company. The new management acquired Cinergy. Most of the subsidiaries of the new corporation will now be called Duke Energy. The legal names of the businesses and what they are called do not always agree.

Power generating Duke Power’s name was first changed to Duke Energy, but it was still called Duke Power. After the Cinergy merger, its name became Duke Energy LLC, but it will now be called Duke Energy. Its full name will be Duke Power Company LLC doing business as Duke Energy Carolinas, LLC.

It’s easy to keep track of; just remember: Duke Power was once called Duke Power. Then it became Duke Energy, but was called Duke Power. Now it is Duke Power, but will be called Duke Energy.

Duke Energy Buys Lawsuits

Employee Advocate – www.DukeEmployees.com – May 12, 2006

Before Paul Anderson came back to Duke Energy as CEO, the company was awash in lawsuits. He went straight to work and many of the suits were settled. In fact, the inventory of lawsuits apparently became so low that it was necessary for Duke Energy to buy some lawsuits!

When Duke Energy bought Cinergy, along with the company came all the baggage – including the lawsuits. Cinergy is no longer the defendant; the defendant is now Duke Energy.

Cinergy was being sued by three states and two environmental agencies over pollution. Now Duke Energy is the defendant, plus Ontario has joined the lawsuit, according to the Toronto Star and the Cincinnati Business Courier.

Seven of Duke Energy’s coal-burning power plants are allegedly producing an unacceptable amount of pollution. Laurel Broten, environmental minister of Ontario, said the coal plants dump around 300,000 tons of pollution in the Great Lakes area. She added "These pollutants have been linked to increased incidence of asthma, especially in children, and to premature deaths and debilitating respiratory conditions…It's critical that Ontario voices be heard. I stand here representing 12 million Ontarians who every day breathe in the air pollution coming from those seven electrical generating facilities from Ohio and Indiana."

Duke Energy claims to comply with all regulations.

Chairmen, CEO’s and Vampires

Employee Advocate – www.DukeEmployees.com – May 9, 2006

Duke Energy Chairman of the Board Paul Anderson has been appointed to the board of BHP Billiton, according to the Sydney Morning Herald. This is noteworthy because Mr. Anderson is a retired CEO of BHP. He was retired for only one year before Duke Energy brought him back as CEO to replace Rick Priory.

Two corporations in a row have wanted Paul Anderson back. You know you are good when people want you back.

It is a safe bet that some departed CEO’s could not buy their way back. Garlic and silver crosses are probably hung around the boardroom to keep certain CEO’s from coming back and sucking the last drop of blood from the company!

Out Foxing the Spin Doctors

Cowans’ Ford Dam Bomb Threat

Employee Advocate – www.DukeEmployees.com – April 28, 2006

Sunday, a citizen received a call from someone with a Middle Eastern accent who threatened to blow up Cowans’ Ford Dam, according to News@Norman. The dam is adjacent to McGuire Nuclear Station in Huntersville, NC. The dam contains Lake Norman, which provides cooling for the nuclear plant.

The Sheriff’s Office notified other law enforcement agencies and Duke Energy. The call was traced to a residence. Sheriff detectives determined that the bomb threat was made by an 11-year-old person.

The Juvenile Court Counselor will decide if any charges will be filed.

Citizen Gets Electrical Shock at Duke Energy Substation

Employee Advocate – www.DukeEmployees.com – April 27, 2006

A citizen received an electrical shock at a Duke Energy substation in Kings Mountain, according to The Herald-Sun. A Duke Energy technician investigating a blackout found the injured man and flagged down a police officer.

Frankie James Dobbins was in critical condition Tuesday at the Wake Forest University Baptist Medical Center's Burn Unit. He was flown there from the Cleveland Regional Medical Center.

Fatal Accident at Duke Energy Development

IBEW, Duke Energy Contract Ratified

Employee Advocate – www.DukeEmployees.com – April 21, 2006

The International Brotherhood of Electrical Workers, Local 1347 members have ratified a three-year contract with Duke Energy, according to The Cincinnati Enquirer. The former Cinergy employees were planning to strike because of Duke’s threats to outsource jobs.

Duke Energy backed off of its plans to eliminate 137 jobs, and agreed to eliminate only 28 jobs. Duke Energy agreed to offer a voluntary severance package for 23 employees. The other five jobs will not be decided on until 2008. Employees will receive pay increases for each of the three years of the contract.

The employees will have to pay increased health-care costs. Union member are not too happy about executives getting huge payouts from the merger, while they only get a bigger medical bill.

Steve Feldhaus, Local 1347 business manager, said "We didn't want the whole pie, just a small piece of it."

New Duke Energy CEO Jim Rogers

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