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Friday, 18 January, 2002, 13:28 GMT
How Enron let down its employees
When energy giant Enron collapsed in December, thousands of employees lost their jobs and life savings. Many, however, thought Enron was the best company they had ever worked for. BBC News Online's Emma Clark looks at the social cost of the world's largest corporate bankruptcy.
When you talk to former employees of Enron and people who knew the company, they have one thing in common.
They all say Enron was an amazing company to work for.
In Houston, Texas, it was seen as the area's number-one employer, paying its staff oodles of money and providing them with top-notch benefits.
In London, the company was less well known, but earned a reputation for lavishing luxuries, training and individual attention on its employees.
"It was a fantastic place to work," says James, a computer programmer who worked at the company for three months before taking voluntary redundancy in November.
"They had this culture of letting you take responsibility for what you did... everybody in the team was enthusiastic and there wasn't the usual bitchiness that you find in these companies."
Living the high life
Over 15 years, Enron had transformed itself from a local natural gas company into a swashbuckling energy trader.
And while it basked in the sunshine of its apparent success, it was careful not to neglect its employees.
"Obviously they worked their people very hard, but they also rewarded them with nice benefits, a nice gym and all those things," says a trader who worked for Enron for 12 years, both in London and Houston.
In London, employees enjoyed a free state-of-the-art gym in the basement, fridges full of canned drinks, taxis home after 9pm, and a concierge to arrange theatre tickets, car servicing or even flowers for your mother.
"There were 35 aerobic classes a week and all the towels and shampoo were provided free - it was awesome," says a trade accountant who worked in the London office for six months.
"It was like having your own set of servants."
Paying the price
Evidently, Enron worked hard to build up a culture of company loyalty and was not afraid to throw its cash around.
In the US the company matched employee pension contributions with Enron stock, while in the UK it gave out stock options and matched 10% of salaries with shares.
"People felt they were really valued, but as it turned out, they lied to us. People were really hurt," says James.
Ironically, because James took voluntary redundancy two weeks before the company collapsed, he walked away with six month's salary for three month's work, plus a starting bonus.
Those who stuck with the company were not so fortunate.
"I knew a girl who had been there 10 years. She had a large proportion of her savings in stock options and she got no pay-off," says James.
"In the end the loyalty of these employees hurt them."
Savings wiped out
The trader, who preferred not to give his name, also left Enron before it collapsed.
Nevertheless, he has seen £362,000 of his savings and pension plan wiped out.
In Houston, where there were more "lifers" working for the company, with pensions heavily invested in Enron stock, employees have fared worse.
Many were forced by the company not to sell their stock even as the price plummeted from $85 to less than $1 in under a year.
"I know a friend in Houston, who is 52, has had a heart attack, has diabetes and then lost £800,000 in his pension plan," the trader says.
"Now he doesn't have a job and he can't get health insurance. It's just unbelievable. I almost feel like I want to start a charity for him."
The company's collapse in December shocked most of its employees.
"It was complete disbelief. It hasn't sunk in yet. I still think that I am going to wake up and it'll all be over," the trade accountant says.
Recently, the trader returned to Houston to visit some of his friends.
"I only ran into a few people who were really, really bitter," he says.
"And I think the reason for this was that most of them were still in shock."
Between the lines
However, some of the employees that left before the collapse had seen the warning signs.
James, the computer programmer, found himself contemplating voluntary redundancy after Enron closed down its bandwidth trading arm in London.
"I had a bit of a bad feeling," he says. "I looked at the internal job market to see if I could get relocated and there wasn't anything advertised at all.
"It was really strange."
The trader left Enron well in advance of its collapse after a row with management.
"I saw things that were totally unacceptable - I hesitate to use the word illegal - but I had a brawl with management over the very issues that brought the company down."
Nevertheless, the trader never expected the company to go bankrupt.
"It was as unbelievable to me as the planes going into the trade center.
"The company seemed too big to be doing anything illegal, you thought somebody had to be watching them."
Feeling is running so high in Houston, that board members are said to be in fear of their lives.
There are whispers that they have hired bodyguards.
"I wouldn't be surprised if someone got a gun out," says Ms Walsh, the engineer.
"No one sees those people like Ken Lay [Enron's chairman and chief executive] in town anymore."
Downtown in Houston, an Enron building stands half built. There is also a baseball pitch, sponsored and named after the company.
Such sites remain a strange testament to a company that seemed to give so much to its workers, but in the end took even more away.
17 Jan 02 | Business
10 Jan 02 | Business
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