Outsource wheels turn fast at NiSource

NiSource Inc. employees were told this week to apply now for jobs to be named later.

On Tuesday, NiSource President Robert Skaggs Jr. informed employees across the company they had two days to submit their resumes to computer giant IBM. NiSource plans to outsource jobs to IBM in a move that will be worth up to $2 billion to the computer giant over 10 years.

In his one-page letter, Skaggs told employees that information on exactly what jobs will be outsourced will not be available until June. But interviews could begin before then.

The size of the contract with IBM indicates hundreds and perhaps thousands of jobs could go.

A NiSource question-and-answer posting available to employees deals extensively with the subject of "rebadging." Rebadged employees continue to work at their jobs but become employees of IBM.

Severance pay will be paid to NiSource employees left without jobs, it states. But employees offered rebadged positions for the same or similar pay within 50 miles of their current workplace will not be offered severance pay.

"Our collaboration with IBM will result in some continuing roles within NiSource, some new positions as NiSource employees, and some job offers for employees as part of the IBM solution," Skaggs wrote.

He also noted some jobs will be eliminated.

A copy of the letter was provided to The Times by the union representing employees at Northern Indiana Public Service Co., which is one of NiSource's largest subsidiaries and the largest utility in Indiana. NiSource confirmed information contained in the letter.

So far, the union has refused to let NiSource send Skaggs' letter to its members, according to Debra Birkholz, president of United Steelworkers Local 13796.

"I wanted to see before they sent this letter just what jobs these people are applying for," Birkholz said.

"I don't hand my personal information over to people unless I know why they're asking for it."

Specifically, the union doesn't want members filling out the online "personal profile sheet" that comes with the letter and e-mailing it to IBM.

NiSource spokeswoman Kris Falzone confirmed Thursday that the union had "refused that opportunity" for its members.

Employees are being given the chance to submit the profiles now so NiSource can tell them the status of their jobs in June, Falzone said. That is when NiSource expects to sign its contract with IBM.

"It is an important step in the process," Falzone said.

"And we are committed to moving ahead with this initiative, to meeting the time frames we've established for employees, and also to treating all employees fairly in this process."

Local 13796 represents about 400 NIPSCO clerical and customer service workers, including 120 at the utility's call center in Merrillville. The union fears all those jobs will be outsourced. NiSource headquarters is in the same building.

Last year, Dallas-based TXU Corp., another energy and utility company, outsourced 2,700 jobs under a $3.5 billion contract with Capgemini, a technology and outsourcing company based in New York.

Birkholz said NiSource managers have been traveling overseas to look into IBM outsourcing operations. The company has said it will not ship the jobs of people who work directly with customers overseas. But they could be outsourced domestically.

NiSource officials have said candidates for outsourcing are jobs in information technology, call centers, supply chain, human resources, billing, finance and accounting and communications.

Union leaders say they will use job-security clauses in contracts to protect the jobs of call center workers and others.

In his letter, Skagg's wrote that not being tapped for an IBM interview does not necessarily mean a job is not available. Some employees may not get interviews with IBM, because entire groups of employees may get job offers from IBM.

The Q&A employee posting also says NiSource employees in some cases may have to train their replacements.

"Performance expectations will be the same as during any transition period," the Q&A states. "These performance expectations may include knowledge transfer with your IBM counterpart."