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MetLife Promise On Jobs Resolved

Acquisition Completed; Insurer Complies So Far On Local Hiring

July 2, 2005
By DIANE LEVICK, Courant Staff Writer

Connecticut's insurance commissioner said Friday she has resolved confusion over MetLife's job commitment in acquiring Travelers Life & Annuity, while the attorney general criticized MetLife for "playing games" on the promise at a hearing in June.

Despite the differing interpretations, MetLife Inc. Friday completed an $11.8 billion purchase of Hartford-based Travelers and flew one of its MetLife Snoopy blimps over Hartford to celebrate.

About 110 layoffs were slated to take effect Friday, though the company refused to reconfirm the number. Hundreds more Travelers workers in "transitional" jobs with MetLife will lose their jobs in the coming year and beyond.

In an agreement with Gov. M. Jodi Rell, MetLife had promised to have at least 1,310 jobs in Hartford for a year after the closing. The disagreement that surfaced Thursday was whether MetLife agreed to have current Travelers employees fill all of the 1,310 positions for the year.

Insurance Commissioner Susan Cogswell and Attorney General Richard Blumenthal believe that's exactly what MetLife promised. And Cogswell said that based on the latest employment numbers, MetLife is complying with the agreement so far.

But the two state officials Friday said it may be acceptable - especially if there is attrition - for MetLife to fill some of the jobs with other people to meet the quota if it cannot find enough Travelers people who are suitable for the positions and want them. The mix of jobs MetLife will have in Hartford differs from what Travelers has had here.

Cogswell Friday issued a statement affirming her department's order Thursday, which approved the Travelers sale. The decision holds MetLife to a promise to maintain 1,310 jobs in Hartford "from the current Travelers employee population for one year after closing."

MetLife, though, never used the language "from the current Travelers employee population" in its commitment letter to regulators, though it expected most of the jobs would be filled by Travelers people.

"They understand at this point what was in the order," Cogswell said in an interview, after talking with MetLife officials Thursday night and Friday. "They have fulfilled the obligation to this point."

She said about 1,100 former Travelers employees had accepted ongoing jobs with MetLife as of Friday, and 400 others accepted temporary jobs of varying lengths - not all lasting a year.

MetLife, Cogswell said in a written statement, has confirmed it will bring additional positions to Hartford to satisfy the 1,310 promise. "These new jobs will be available to former Travelers employees and others who desire to work in Hartford and who are qualified to fill them," she said.

Cogswell said her department will closely monitor MetLife on fulfilling its commitment, and encourage the company to offer permanent jobs to the transitional workers as attrition and vacancies occur.

"Realistically, at the end of the day, they may not be able to fill all 1,310 jobs with former Travelers employees," Cogswell said in an interview. "We'll have to analyze the situation at the time."

Blumenthal Friday reviewed a transcript of MetLife testimony from the June 7 hearing on the deal and said, "They should have been less opaque and more forthright in their testimony" on the jobs promise.

William J. Wheeler, a MetLife executive vice president, responded initially "that is correct" when regulators asked at the hearing to confirm an agreement to "maintain 1,310 jobs from the current Travelers population for one year after closing."

But then Wheeler's team conferred with him, the transcript shows, he asked to clarify the number, and then he said, "Just to be clear, we've committed to maintain 1,310 jobs in (pause) in Hartford." He did not use the words "from the current Travelers population." Nevertheless, the department's attorney then responded "OK."

"He's playing games," Blumenthal said Friday, reviewing the transcript. "He's seeking to clarify the record in his view without calling attention" to the differences between the way he and the department stated the commitment.

Like Cogswell, though, Blumenthal said MetLife may need to be granted leeway in fulfilling its commitment. "They should try to fill them with Travelers people. They have an obligation to fill them with Travelers people," he said. "But if there are simply insufficient numbers of Travelers people, we want to keep the jobs here anyway."

MetLife spokesman John Calagna would not comment on Blumenthal's criticism. In a written statement, Calagna said, "The commissioner's [written] statement today speaks for itself, and we have no other comment except to say we certainly agree with what it says."

"Now that the acquisition has been approved, we look forward to our first full day of business in Hartford as MetLife next Tuesday," Calagna said.

Rell's office did not respond to multiple requests Friday for comment on the situation.

Meanwhile, MetLife rolled out the welcome mat Friday for Travelers employees with senior company officials greeting them upon arrival, a buffet breakfast, and a MetLife gift bag with notebook and pen.

To buy Travelers, MetLife paid $10.8 billion in cash to Citigroup and about 22.4 million shares of MetLife common stock valued at roughly $1 billion.

The acquisition is MetLife's largest, and boosts its presence in annuity, retirement and savings plans, and international markets. The deal will provide a "modest" benefit to earnings in the second half of this year, MetLife said

Reprinted with permission of the Hartford Courant. To view other stories on this topic, search the Hartford Courant Archives at http://www.courant.com/archives.
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