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National Grid agrees to $2m Sandy pay deal

National Grid has agreed to pay nearly $2 million in damages to hourly employees who were left unpaid for work during Hurricane Sandy last year due to problems with the utility’s payroll system, under a settlement with Attorney General Martha Coakley announced Thursday.

National Grid will pay more than 2,000 of its employees in Massachusetts a lump sum of $750 each to compensate them for financial hardships they may have suffered because of delays in getting storm pay.

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Additionally, the utility will pay the state $270,000 in penalties for failing to pay employees for Sandy-related work by the December 2012 deadline set by Coakley.

The powerful storm hit in October, but National Grid did not pay all employees for all their work until early this year.

Because of glitches in a new payroll system National Grid launched last year, “thousands of problems were identified companywide,” including failure to pay wages on time and failure to pay overtime, Coakley’s office said.

“Many workers went unpaid or underpaid for weeks . . . as these payroll issues were being rectified,” Coakley said in a statement.

National Grid will also reimburse employees for any late fees or other expenses incurred as a result of the payroll issues, according to the Utility Workers Union of America.

“We are pleased that National Grid is being held accountable for the payroll failures that plagues the company for months and caused harm to thousands of workers and their families,” Dan Hurley, president of the union’s Local 369, said in a statement.

In addition to hourly workers, National Grid said it will pay the $750 lump sum to “a number of management employees” who were also affected by the payroll glitch but not included in the agreement with the attorney general, said Jackie Barry, a National Grid spokeswoman.

Barry noted the cost of the payouts will be absorbed by company, and not passed on to customers.

“We’re pleased that we’ve reached this agreement, and we regret the inconvenience and frustration that these issues caused our employees,” Barry said.

More than 6,500 National Grid workers in New York will receive similar settlements, according to the New York attorney general’s office.

Those payments will total just under $5 million.

Gail Waterhouse can be reached at gail.waterhouse@globe.com. Follow her on Twitter at @gailwaterhouse.
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