Verizon Agrees to Raise Pay in ‘Final Offer’ to Labor Unionsby
Carrier proposes 7.5% wage increase over length of contract
Union says company hasn't addressed job-security concerns
Verizon Communications Inc. raised its wage proposal to 36,000 striking phone workers, offering a 7.5 percent increase over the length of the contract. The union said it remains concerned about job transfers.
The strike is in its 16th day, and more than 1,000 union-represented employees have returned to work, according to a statement from New York-based Verizon Thursday. The walkout by the Communications Workers of America and the International Brotherhood of Electrical Workers has had minimal effect on operations, the company said.
Bob Master, a CWA representative, said talks between the two sides broke off at about 3:30 p.m. in New York. No decisions have been made on when the next negotiations will take place, he said.
Among the union’s demands are limits on work transfers to other regions and jobs outsourced to contractors in other countries.
“They continue to refuse to address our main concern about protecting jobs in our communities and their rhetoric isn’t going to work,” Master said in an interview. “This is hurting the perception of their brand and the replacement workers are not doing a very good job.”
Verizon’s “best and final offer” includes job-security measures for current workers if the union agrees to cooperate on layoffs, buyouts and reassignments. The company offered to continue matching 401(k) retirement benefits and contributing to pension plans with increases. At the same time, Verizon is seeking increases in contributions from employees to their health care coverage plans.
Union workers including FiOS technicians, cable splicers and customer-service representatives have been working without a contract since Aug. 1. Almost all are employed by Verizon’s landline business, which has seen annual declines in the number of lines served as well as job cuts. The company has refocused on wireless and mobile video, where it sees more growth and employees aren’t in unions and are typically younger.
The company has assigned managers, temps and contract employees to call centers and jobs out in the field to handle some of the work during the strike.
Pressure on Earnings
Last week, Verizon warned investors that its standoff with the unions will put pressure on second-quarter earnings, without offering specifics. That sent the shares down 3.3 percent on April 21. On a earnings call, Chief Financial Officer Fran Shammo said Verizon has budgeted for the cost of the labor disruption and doesn’t expect the dispute to cut into earnings. If the strike continues for an unspecified amount of time, Shammo said the company may have to “come back in mid-year” to address its earnings forecast.
The last Verizon strike, in 2011, lasted two weeks. Workers returned to their jobs without a new contract as negotiations continued.