Fluor to trim Richland staff by 90 percent

Fluor Corp. is shrinking its Richland office from about 200 employees to 15 or 20, according to a company spokesman.

More than half of those workers may be offered continued work at Hanford or work at Fluor offices in Texas or South Carolina, according to Fluor.

But that will leave possibly 40 to 50 workers from the Richland Fluor office who will be laid off without being offered other employment.

Fluor has worked on Hanford nuclear reservation projects in the Tri-Cities since 1986. From 1996 to August 2009, when its contract expired, it was a prime contractor for the Department of Energy at Hanford. For some of those years it employed about 3,500 workers.

Since Fluor's DOE contract ended, it has continued to work as a subcontractor at Hanford and has employed workers in Richland to support Fluor work elsewhere. That has included business support, such as providing payroll services for 9,000 Fluor employees.

It also has provided support to Fluor activities in Iraq and Afghanistan; technical expertise to DOE sites in South Carolina and Ohio where Fluor is the prime contractor; and project management and infrastructure services for the Kearl Oil Sands Project in Alberta, British Columbia.

"Fluor has been a good employer and good corporate citizen since the late '90s, so it is disappointing to see downsizing," said Carl Adrian, president of the Tri-City Development Council.

The company has supported not only TRIDEC, but also the Tri-City Regional Chamber of Commerce and the Tri-Cities Visitor and Convention Bureau.

The staff of up to 20 people who will remain in Richland will close out previous contracts and continue business development work, said Keith Stephens, senior director of media relations for Fluor.

"We have a long history there," he said. "We will continue to have a presence there and support DOE any way we can."

The cutback at the Richland office is driven by two unrelated initiatives, he said. CH2M Hill Plateau Remediation Co. is ending a subcontracting arrangement with Fluor to do work at Hanford and Fluor has decided to move some of its non-Hanford work to offices in Texas and South Carolina.

CH2M Hill is making major changes to its subcontracting policies starting in October 2013, when the second five-year period of its DOE contract begins. Since CH2M Hill became the DOE contractor for central Hanford and groundwater cleanup in 2008, it has been awarding work to 11 preselected subcontractors, including Fluor Federal Services in Richland, without putting out bids.

CH2M Hill has called the change in subcontracting policy an opportunity to reduce costs and increase competition, if some of the work now automatically assigned to preselected contractors is put up for bids.

However, a DOE letter last year said that consent for using preselected subcontractors would be limited to the first five-year period of CH2M Hill's contract. Competition for subcontracted work was the preferred method for determining the reasonableness of the cost of work, the letter said.

CH2M Hill said in January that it would be hiring about half of the workers who have been doing work assigned to it as employees of its preselected subcontractors.

As part of that initiative, about 90 to 100 Fluor workers performing Hanford work for the CH2M Hill contract are being asked to reapply for their jobs as potential CH2M Hill employees.

CH2M Hill plans to give preference to workers who hold jobs now as CH2M Hill subcontractor employees, but there could be some change in the mix of jobs for which work is available, said CH2M Hill spokeswoman Tania Reyes-Mills. The change in employers would start Sept. 30.

The second initiative leading to reduced staff at Fluor's Richland office was being considered before the CH2M Hill subcontracting change, Stephens said.

Fluor decided that it would be more efficient to move business support services being done in Richland, including payroll, finance and information technology work, to other offices, he said. The work now will be split among two of Fluor's large offices, one in Greenville, S.C., and the other in Sugar Land, Texas.

About 30 to 40 Richland employees now doing the work are being offered opportunities to relocate, Stephens said.

Fluor Federal Services notified the Washington State Employment Security Department this week that it is laying off about 150 people starting Sept. 26. The notification is required by the Worker Adjustment and Retraining Notification, or WARN, Act.

The 150 layoffs evidently include about 100 employees who may reapply for their Hanford jobs with CH2M Hill and the 40 to 50 employees who are not being offered any additional employment, but not those workers with opportunities to relocate to Texas or South Carolina.

-- Annette Cary: 582-1533; acary@tricityherald.com; Twitter: @HanfordNews