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Enron pays $55M to 500 workers
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December 6, 2001: 12:27 p.m. ET
Crippled energy trading company pays $110K apiece to "necessary" workers.
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NEW YORK (CNN/Money) - Enron Corp., the humbled energy trader, paid about $55 million to about 500 employees that it considers necessary to its survival, a spokesman confirmed Thursday.
Houston-based Enron paid an average of $110,000 apiece to the 500 workers, far larger than the flat $4,500 offered to the other dismissed workers.
Enron, which filed the biggest bankruptcy in United States history, took the steps to ensure that its critical people were in place after it filed for Chapter 11 protection. Enron intends to reemerge from bankruptcy as a slimmed down commodity trading firm, the Wall Street Journal said.
Of the people that received the payments, 75 percent were below the level of vice president, spokesman Mark Palmer said.
"Had we not done that [and filed for] liquidation, then 21,000 people would have lost their jobs," he told CNN/Money.
Employees who take the payout but decide to leave before the 90 day period must pay a significant penalty, Palmer said.
Enron is now in talks with several third parties, including J.P. Morgan and UBS Warburg, to form a joint venture to run its energy trading operations, CNN/Money reported earlier this week.
Enron has laid off about 25 percent of its 21,000 employees. Enron recently cut 4,000 workers, mostly from its headquarters in Houston, as well as 1,100 staffers in Europe.
Shares of Enron (ENE: down $0.35 to $0.66, Research, Estimates), which had been gaining earlier this week, dropped nearly 35 percent Thursday.
The Labor Department announced Wednesday that it will launch an investigation of the crippled energy trader's handling of its workers' retirement benefit plans.
The U.S. Labor Department will determine if the company broke any federal laws in freezing employee 401(k) accounts even as company stock prices plummeted, said Labor Secretary Elaine Chao. 
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