Correction to This Article
A June 21 Business article said that fired Washington Gas Light employees will receive 12 weeks of severance pay. Twelve weeks is the minimum they will receive.

Outsourcing Will Slash 300 Washington Gas Jobs

By Xiyun Yang
Washington Post Staff Writer
Thursday, June 21, 2007

In a move that will eliminate 300 positions, Washington Gas Light said yesterday that it had hired an outsourcing firm to handle information technology, customer service and other back-office duties.

The natural gas company projects it will save about $170 million in capital and operational expenses over the life of the $350 million, 10-year contract with Accenture, a Bermuda-based consulting and outsourcing firm, said Washington Gas spokeswoman Kimberly Greer.

Accenture will redistribute jobs from the gas company to its many centers, including those in Springfield, Reston, Canada and the Philippines, where it plans to handle data-processing work, said Keith Mueller, managing director of Accenture business services for utilities.

Of the 300 positions to be eliminated, 50 are vacant. Employees in the remaining jobs will be offered similar jobs with Accenture, transferred to other WGL departments or let go. Those in the latter group will receive 12 weeks of severance pay and will have access to career-counseling services. The company employs 1,605 people.

Labor union representatives expressed outrage and promised to fight the cuts.

"Shipping this critical local work out of town is simply madness," said Josh Williams, president of the AFL-CIO's Metropolitan Washington Council, an umbrella group for 200 union locals. "Does anyone seriously think this work can be done better for the energy consumers of metropolitan Washington by sending it away to newly hired and newly trained staff, possibly half a world away?"

Dave Levinson, a lawyer for the Office and Professional Employees International Union Local 2, which represents about 50 of the jobs targeted for elimination, said the union would seek to block Washington Gas's request before the D.C. Public Service Commission to raise rates, arguing that the company planned to make customers pay the transition costs.

Washington Gas said it expected to pay $29 million in one-time costs over the next two fiscal years to make the change, including about $9 million in severance and benefits and $20 million in upgrades and other transaction costs. The company also will purchase $16.4 million worth of equipment and software from Accenture affiliate Proquire as part of the deal.

Greer said those costs have already been factored into the $170 million in savings the company hopes to eventually realize.

"We considered pretty much every 'what if,' and we're positive that we can work to the benefit of both parties," Greer said.

© 2007 The Washington Post Company