TVA rescinds plans to fire tech workers

The Tennessee Valley Authority is reversing a move to fire technology workers three days after President Donald Trump hosted an event denouncing the plan.

According to the TVA press release, company officials including CEO Jeff Lyash – whose $8.1 million salary and benefits package came in for presidential criticism – met with White House Chief of Staff Mark Meadows and White House Counsel Pat Cipollone on Aug. 6.

"We had a positive meeting with the White House and wholeheartedly agree with the administration’s direction on jobs," said interim TVA board chairman John Ryder in an Aug. 6 press statement. "We expressed that our IT restructuring process was faulty and that we have changed direction so that we can ensure American jobs are protected."

Trump fired TVA chairman James "Skip" Thompson and board member Richard Howorth earlier this week and announced the moves at a White House event that featured TVA staffers complaining of coming layoffs and of having to train their replacements.

In all, TVA had planned to lay off 200 IT workers and replace them with contract staff as part of a modernization plan. For about the past 10 years, according to sources familiar with TVA's computing environment, the power company has relied on a mix of in-house servers and cloud-based technology and had planned to move into a managed services environment. Accenture Federal Services, CGI Federal and Capgemini are the three contractors involved in the projects.

A TVA spokesperson told FCW that "as far as the current contracts go, our supply chain and IT organizations are working with internal stakeholders to determine how the events of this week impact these vendor partnerships," and that more would be known in the coming days and weeks.

"This is certainly a win for American workers, for TVA ratepayers, and for everyone who relies on the U.S. electrical grid,” said Gay Henson, president of the Engineering Association/IFPTE Local 1937, which represents TVA technology workers. "Our members will get their jobs back. TVA ratepayers will benefit from having skilled U.S. workers providing quality service. And the entire U.S. electrical grid will be more secure, with critical information remaining on U.S. soil."

According to a previous statement from Accenture, the contract with TVA required that the work be performed in the United States. It's not clear whether any TVA data would have been stored outside the U.S. under the outsourcing plan. The parent companies of Accenture Federal Services and CGI Federal are headquartered outside the U.S. and Capgemini is a French firm.

TVA did not immediately respond to questions about the future of its technology modernization plans and the status of the contracts for outsourcing technology operations.

TVA is federally owned electric utility founded during the New Deal that delivers power to more than 10 million customers across the southeastern United States. The company does not receive federal appropriations and is funded through revenues generated by the sale of electricity. However, the president does appoint board members and rules governing its operations are set in law.

Correction: This article was updated Aug. 7 to more accurately reflect TVA's computing environment.