Executive Pay Freeze at Six Utilities Urged

Four civil rights groups urged Thursday that the salaries of top executives at six major utilities in California be ordered frozen and that rate increases of the utilities be halted until they promote more women and minorities and give minority companies more business.

The call for the freeze on salaries of those earning more than $100,000 a year would affect executives at Southern California Gas Co., Southern California Edison Co., Pacific Gas & Electric Co., San Diego Gas & Electric Co., Pacific Bell and General Telephone.

It came during a daylong legislative hearing in Los Angeles from officials of the Urban League, the Black Chamber of Commerce, the League of United Latin American Citizens and the American G.I. Forum.

They said the state Public Utilities Commission had the authority to order such action, pending a change in what the chairwoman of the hearing, Assemblywoman Gwen Moore (D-Los Angeles), joined the groups in calling an “atrocious” record by the utilities in promoting and doing business with women and minorities.

Representatives of the companies appearing at the hearing opposed such a freeze, contending that they have been working with some success to improve their performance in both areas.

Robert Gnaizda of Public Advocates Inc., representing the civil rights groups, acknowledged that it is unlikely that the PUC will order such a salary and rate freeze.

He noted that the commission itself is composed of five white males and has had only one black and one women member, and no Latino or Asian members, in its history.

The civil rights advocates provided no exact figures on how many executives would be affected by the proposed wage freeze.

But figures provided to the Assembly Committee on Utilities and Commerce by the six utilities indicated that as of 1986 they had a combined total of 39 people earning more than $200,000 a year, 600 people earning more than $88,000 and 1,350 people earning more than $75,000. Of the 39 people earning more than an annual $200,000 at the utilities, according to the information provided, only one, an Asian, is a member of a minority group and there were no women.

Of the 1,350 earning more than $75,000 a year, Moore said, the six companies combined had listed only 14 Latinos, 18 blacks, 23 Asians and 48 women.

The assemblywoman said the statistics show that the utilities are not moving minorities and women up into decision-making positions.

Several company representatives at the hearing, however, said such promotions take time and that the companies are moving such people into middle management positions that pay less than $75,000 a year.

For instance, Paul A. Cardenas, manager of personnel relations and planning for Southern California Gas, testified that in the last 10 years the company has increased minority participation from 10% of its total work force to 43%.

When Moore said that of the gas company’s 138 employees earning more than $75,000 a year, only three are Latino, four are black and three are Asian, Cardenas responded that the company has set no goals for promoting such people into these positions.

“Company goals extend only through middle management,” he said.

Moore also had a sharp exchange with Chuck Smith, executive director of corporate education for Pacific Bell.

When Smith remarked, “Perfect, we’re not,” Moore interjected that the company is far from perfect. Of its 356 executives earning more than $75,000 a year, she said, there are only two Latinos, six blacks, two Asians and 13 women.

Others who testified later, however, paid tribute to Pacific Bell for agreeing to sit down with Latino and black organizations to discuss hiring and contract issues, which they said is more than many companies have done.

Another issue at the hearings concerned contracts awarded by the companies to firms owned by women and blacks. Gnaizda said that recent figures show that less than 0.5% of all contracts go to black-owned firms and that only about 3% to firms owned by women.

In 1986, the civil rights advocates said, Southern California Edison awarded only $41,000 out of a total of $324 million in construction contracts to blacks.

Goals Told

Representatives of several companies present testified, however, that their companies have been setting and achieving goals to award more contracts to minority-owned or women-owned firms. Southern California Gas, for instance, was said to have a goal of 10.35% for 1987, which it expects to achieve.

Assemblyman Nolan Frizzelle (R-Huntington Beach), who was attending the hearing, said he did not think it was fair of minority firms to seek more business from white-owned firms unless they were prepared to hire a fair proportion of whites.

But Moore said that advancing minority participation in the utilities and other businesses is distinctly in the public interest.