For many years, CPS Energy employees have inquired about retirement incentives.
Last week, company leadership announced a voluntary retirement incentive program to employees who are retirement eligible.
CPS Energy’s diverse workforce of more than 3,300 employees includes people in positions such as accounting and billing, coal handling, power plant operations, planning and construction and maintenance of our electrical infrastructure; 27 percent are retirement-eligible.
This means that approximately 900 employees could retire at any time, a situation that could create voids in positions essential to meeting our customers’ needs. Leadership came to the conclusion that offering an incentive program could provide a more predictable retirement rate for some positions and help with workforce planning and business-continuity planning.
“While considering this possibility, we were challenged with making sure that the needs of the business, in carrying out its commitments to the community, would not be compromised,” said President & CEO Doyle Beneby in a message to the company’s workforce last week.
“Additionally, it was important to propose a program that would pass the test of community responsibility and reasonableness. After completing analysis and a robust workforce-planning initiative, we have determined that now is the right time to offer such a program.”
CPS Energy is not alone in such workforce challenges. A recent San Antonio Express News article noted that San Antonio will need a long-term strategy to have enough workers trained to build and maintain expanding transportation, energy and telecommunications systems, especially as older workers retire.
Replacing the knowledge base and experience of highly specialized jobs “keeps CEOs up at night,” asserted a January Texas Tribune story. At the SouthTexas Project nuclear facility, for example, about 40 percent of the company’s 1,200 employees are eligible for retirement; imagine what would happen if they all retired at the same time.
To be eligible for the program and retire August 1 of this year, employees must meet one of three criteria: 25 years of benefit service (years contributing to the company’s pension plan); age 55 with 10 years of benefit service; or age 65 or greater. Employees accepting the program offer will receive a lump-sum payment equal to two weeks of pay for every year of service, up to one year’s salary.
Those eligible will have until June 16 to accept the one-time offer, as CPS Energy has no plans to offer future retirement incentive programs. And it’s completely voluntary: those who decline the offer will remain in their present positions, and no one will be forced to accept the offer.
Vacated positions will be filled as necessary to maintain operations and serve customers. Unlike reductions in force used by some businesses to reduce cost, this program is about managing the departure of retirees. Fortunately, CPS Energy remains financially strong and continues to receive enviable credit ratings from the three major credit ratings agencies.
CPS Energy remains committed to making reasonable, sound business decisions that our community expects of us, and we are committed to meeting our customers’ energy needs with a high degree of service.
We will continue to work for you.