Former Enron Workers' First Settlement Payments Miscalculated

July 5, 2007 ( - Thousands of former Enron Corp. employees may have to pay back a portion of the first payment they received as part of a settlement over lost employee stock ownership and 401(k) plan savings after the company's collapse.

According to the Associated Press, Harlan Loeb, spokesman for Enron, now known as Enron Creditors Recovery Corp., said nearly $22 million of the $89 million initial payment was miscalculated. The payments are being recalculated, but according to the news report, a bout 7,700 ex-workers were overpaid and about 12,800 were underpaid.

Loeb said a software program used by Hewitt Associates, the company Enron hired to allocate the settlement proceeds, used the wrong stock price when calculating the payments. In court filings Hewitt said the problem was “due to an undetected data error,” but disputed the assertion that Hewitt is the fund administrator and thus responsible for making sure funds are correctly distributed.

Enron has asked a U.S. District Court to make Hewitt redo its calculations, certify them, and offer former workers a way to protest if they disagree with the new numbers, the AP reports.

The issue could cause the second settlement payment of about $85 million to be delayed.