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Enron employees stuck with deferred compensation

Enron Corp's spectacular collapse left many of its employees with shattered pension plans, but less publicised is up to $400 million the energy trader left owing about 400 of its senior staff.

Now those key employees are lining up with the cream of Corporate America to grab back as much of the money as possible in Enron's bankruptcy proceedings -- the biggest in US history.

On the unsecured creditors' committee is Michael P Moran, a retired attorney of the energy trading giant who represents a growing group of more than 100 former Enron employees. The committee represents Enron's biggest unsecured creditors.

Hasty organising skills won Moran and his group a place on the 15-member committee, a coup that could give them a chance of winning a portion of what they say Enron owes them.

While the group may win only a fraction of what they are owed, they are better off than those with company stock, who rank behind creditors in divvying up the assets of bankrupt companies in Chapter 11 reorganisation plans.

The stock, which peaked at $90.56 a share just 16 months ago, was trading at 57 cents on Friday. Enron's collapse dealt a blow to thousands of former and present company workers who held the stock in their retirement plans.

President George W Bush told reporters Friday he was "deeply concerned" about Enron employee losses, but stopped short of proposing remedies.

The creditors committee, composed mostly of giant banks like J P Morgan Chase and Citibank and bondholders like Oaktree Capital Management, was appointed December 12 by a US trustee of the bankruptcy court to negotiate with Enron during its bankruptcy.

"It was unsecured, but we knew that at the time," said Moran of deferred compensation payments he made over eight years. "But you don't expect Enron to go down the tubes."

Moran, 52, said he retired in August after 28 years with Enron, but never received payments under the plan. He estimated some 400 people participated in the plan, building up $250 million to $400 million in deferred compensation. The benefits were of the plan deferred taxes and building up a nest egg.

A spokesman for Enron declined to comment on the claims, citing pending litigation that some employees have undertaken against the company.

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