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National Grid agrees to $5 million settlement for underpaying workers

National Grid’s hourly workers across New York – and some management employees – will be getting an extra $750 in their paychecks, along with any unpaid wages they were owed because of payroll glitches that occurred when the utility switched to a new computer system.

The payments, which will total more than $4.8 million, are part of a settlement announced Thursday between the company and State Attorney General Eric Schneiderman over the company’s failure to either pay its more than 6,500 hourly employees all they were owed or pay them on time.

Under the settlement, National Grid employees who were underpaid will receive their back wages, in addition to the additional $750 payment that will be made to all of the company’s hourly workers who were on the job between Nov. 1, 2012 and March 31 of this year.

The payroll problems stemmed from the company’s conversion to a new computer system, which changed its timekeeping and payroll systems in the wake of Superstorm Sandy in early November. That conversion, coming at a time when the utility was scrambling to restore service to tens of thousands of customers downstate, disrupted the company’s timekeeping and pay system when many of its employees were working long hours as part of the cleanup efforts.

In all, there were about 32,000 incidents during a period of 19 weeks where employees were underpaid, the Attorney General’s Office said.

Some workers were not paid at all. Some received their regular pay but not overtime. Others had problems with the direct deposit of their pay, and some did not have the proper deductions taken from their pay, including child support payments. Other workers were paid too much.

“National Grid’s workers will receive some compensation – and an explanation – for the financial hardship they endured in the aftermath of the storm,” Schneiderman said in a statement.

Jackie Barry, a National Grid spokeswoman, said the company also has decided to make the $750 payments to an unspecified number of its non-union employees. In all, National Grid has about 10,000 employees in New York.

“We felt it was the right thing to do,” she said. “They experienced similar challenges because of the payroll issue.”

National Grid also will not attempt to recover overpayments that were made to an unspecified number of employees who were paid too much between last November and the end of this month, Bradley said.

The cost of the settlement and the additional payment to workers will be borne by National Grid and not its ratepayers, Bradley said.

A similar $2 million settlement involving more than 2,000 of National Grid’s employees in Massachusetts was announced Thursday by Massachusetts Attorney General Martha Coakley.