No' Says Sunoco

Refiner-marketer rejects Pa. governor's request to reverse layoff decision

PHILADELPHIA -- Pennsylvania Governor Ed Rendell on Thursday asked Sunoco Inc. to rescind its decision to permanently lay off 20% of its salaried work force, according to a report by The Philadelphia Business Journal. The governor said in a letter to the board of directors of the oil refiner and gasoline retailer that he could understand the need for Sunoco to lay off employees if it had posted an operating loss last year, but it had "healthy, or what many consider huge, profits."

Sunoco announced late last week that it is reducing its salaried workforce by approximately 750 [image-nocss] positions in 2009 in the first phase of the company's Business Improvement Initiative. This phase of the review included all business and operations support functions. The company plans to offer hourly employees in certain identified areas the opportunity to resign and receive severance.

While not prepared to offer details, a spokesperson for Sunoco told CSP Daily News earlier this week that the reduction does include members of its retail marketing business unit. "Those people may have been affected," said Thomas Golembeski. "A dealer who operates a Sunoco station may be dealing with a new representative from Sunoco." (Click here for coverage.)

"These layoffs are not being implemented to keep the company from going in the red," the governor wrote. "They are solely intended to make a profitable company more profitable and helping pad the dividends paid to shareholders."

Philadelphia-based Sunoco earned $776 million on revenue of $54.1 billion last year and $891 million on revenue of $44.7 billion in 2007, said the report. The company's dividend this quarter was 30 cents per share, it added.

A spokesperson for Sunoco said the layoffs, which will eliminate 750 white-collar positions, are necessary because of the economy. "All evidence points to the fact that we are in a down cycle in the refining business and we believe 2009 into 2010 will be a challenging time for refiners," Golembeski told the newspaper.

He added, "This is a strategic decision to keep the company strong so we can continue to provide good jobs and continue to attract investments that allow us to grow. So we will not be reversing our decision."