Verizon workers ratify new contract after victorious strike

Three weeks after the end of a 45-day strike, members of the Communication Workers of America (CWA) and International Brotherhood of Electrical Workers (IBEW) in the Northeast and Mid-Atlantic states ratified a four-year collective bargaining agreement with Verizon.

CWA Vice President District 1 Dennis Trainor called the strike “an incredible victory for the nearly 40,000 courageous workers who put everything on the line to protect the good jobs for their families.”

“It was a tough strike, but this contract, which secures good jobs in our communities and preserve workers’ standard of living shows what can happen when we stand together,” said Ed Mooney, vice president CWA District 2-13. “I am so proud of our members for standing up for themselves, our communities, the customers and their families.”

Because union power has been greatly weakened during the last 30 years, a union official claiming victory in a strike can mean anything from, “we returned to work without making any significant concessions” to “we survived.”

But in this case, the outcome looks like a solid win for labor.

Verizon wanted to outsource more work, close 16 call centers, eliminate jobs, and make the jobs remaining less secure.

The new contract maintains all the call centers except for two small ones in New York (where workers will be placed in other jobs at the company), creates 1300 new call center jobs, returns outsourced pole maintenance work in New York to union workers, and maintains job security provisions including no involuntary layoffs, forced transfers, or job classification downgrades.

Verizon wanted to freeze pensions and force workers in the defined benefits pension plan to choose between the defined benefits plan or 401(k) savings plan.

The new contract maintains the current pension plan for those enrolled in it and increases pension payments by 1 percent each year over the next three years.

Verizon wanted to eliminate corporate profit sharing for workers.

The new contract preserves profit sharing and sets a $700 yearly minimum.

Verizon proposed a 7 percent pay increase over the four-year term of the contract.

The new contract calls for a 10.9 percent increase over four years.

The one area where Verizon made some headway was health care.

The new contract requires higher health care premiums for workers, but the wage increases will offset the higher costs with enough left over for a decent take-home pay raise.

Conventional wisdom held that winning a strike at Verizon would be difficult if not impossible.

Almost all of the company’s union workers work in the wireline division while most of the company’s revenue is generated by its wireless division.

Verizon’s technology investments also appeared to give it an edge in the strike.

The Washington Post reported that “a decision Verizon made at least two years ago to cut the human out of many customer interactions is blunting some of the strike’s effects. . . . The technology-driven shift. . . could give Verizon a greater ability to withstand one of the biggest walk-offs in company history.”

But as it turns out, the wireline division is still an important generator of revenue and Verizon’s technology turned out to be a poor substitute for the skilled hands and minds of the company’s union workers.

One important job done by union workers is the installation and maintenance of FiOS, Verizon’s voice over internet service that customers use to access telephone, internet, and cable service.

Replacement workers couldn’t keep up with the demand for new FiOS installation. As a result, one analyst estimated that the company would lose up to 150,000 customers during the strike.

Also, replacement workers weren’t able to keep landline telephone service intact.

In one instance, the Homestead, Pennsylvania police department reported that its telephone system was unavailable because replacement workers were unable to repair it.

““We can’t talk to anybody,” said Homestead Police Department Chief Jeffrey Desimone to KDKA, a CBS affiliate in Pittsburg, during the  strike. “Our phone lines have been down for over two weeks actually. Can’t seem to get any help.”

A month into the strike, Verizon warned investors to expect a steep drop in revenue because of the strike.

One Wall Street analysts said that the strike would trim Verizon’s yearly earnings by $200 million.

The strike was also having an impact on the national economy. A poor May jobs report was blamed partially on the strike.

US Secretary of Labor Thomas Perez took interest and called the two sides together for mediated negotiations.

Perez told the two sides that he didn’t care what the final agreement looked like only that the two sides reach an agreement in a hurry.

The mediated talks not only resulted in a contract for wireline workers, they produced new contracts for the small number of Verizon wireless workers who belong to CWA, which could be significant going forward.

About 100 union wireless technicians in New York won gains that include the same raises and signing bonuses as the wireline workers, a new parental leave benefit, and improved standby pay.

Verizon retail workers in Brooklyn and Everett, Massachusetts, who recently joined CWA, ratified their first collective bargaining agreement with the company.

The new agreement establishes a guaranteed base of $2000 for performance pay, a grievance procedure that includes arbitration, restrictions on subcontracting, and the right to swap schedules.

These gains for wireless workers could be the most important result of the strike.

The wireless workforce is overwhelmingly non-union, and Verizon would like to keep it that way.

The new contract gains could encourage more wireless workers to unionize.

How effectively the union organizes these workers will have a big impact on the next round of bargaining four years from now.

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