Verizon, Unions On the Brink

August 5th, 2011 by · 9 Comments

Don’t look now, but this weekend might just see a strike break out on telecommunications land.  Verizon and its wireline employees are on the brink, with the current contract expiring at 12:01am on Sunday.  The CWA and IBE have already voted to authorize a strike, which would impact 45,000 Verizon workers on the east coast.  I’d like to think this one will be short or even that they could work something out at the last minute, but it could be that the situation is ripe for something much uglier.

Verizon’s wireline business is of course always under pressure these days from losses from the copper side of things and the expense of its FIOS fiber buildout relative to uptake.  And obviously, one of their key tactics to keep costs inline is to find ways to cut benefits, limit salary growth, and of course reduce headcount.  We know this story well.  But Verizon as a whole is not hurting and pressure from technology and competition is part of the game.  With its huge positive cash flows, the addition of the iPhone to its lineup, and its relatively lower dependence on aging copper after selling off most of its rural assets, they seem to be in the catbird seat right now and will probably find it rather more difficult than usual to generate much sympathy.

Meanwhile the rest of the world is feeling the effects of recessionary pressures, high unemployment, and general disillusionment with a recovery that benefited the likes of Verizon but not so much the little guy.  Frankly there are a lot of angry people out there who aren’t going to back down easily.  Lots of those people work at Verizon, and unlike with the spate of layoffs we have seen elsewhere in the non-unionized part of the sector, they have this alternative way to make themselves heard and send a little pain back the other way.  I can’t say I blame them either.  Meanwhile, the political situation nationally is, if anything, more divided and less interested in dialogue than I have ever seen it.

The unions say that Verizon wants to cut all sorts of stuff, Verizon says the unions aren’t willing to go along with a necessary $100/month employee contribution to health care.  Doesn’t matter really, the actual points of disagreement could have been anything.  This kettle may simply be ready to boil again.  What that will mean for Verizon’s customers, both consumers and wholesale (e.g. CLEC), is unclear.  Initially probably nothing substantial, but if things don’t get resolved quickly, who knows.

Or maybe cooler heads will prevail.  After all, it’s not as if we have a brand new CEO at Verizon who needs to prove he’s got what it takes to lead the company and can’t afford to start off by backing down to the unions.  Oh wait.  Never mind.

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9 Comments So Far

  • Mr Poppers says:

    Verizon: CWA and IBEW Break off Contract Negotiations, Call Strike

  • Par kite says:

    Oh boy. Need. More. Breaks. Healthcare premiums????? Outrageous!!!!!

  • Anony says:

    I like how the reports say VZW customers will not be affected as if those calls don’t hit the wireline infrastructure.

    Are VZW techs non-union and still doing their work going into the CO’s & MTSO’s?

  • Eric Titus says:

    I’d probably fit right in with “angry people” crowd who are skeptical about the need for a company with multi-billion dollar profits to cut labor costs at a time when the industry is doing well. From what I can tell, Verizon never really made a serious push to negotiate–this effort is about triggering a strike in order to hurt union power in the company. It’s not that Verizon and the Union don’t have some things to discuss–they certainly do–but it would have been better for both parties to discuss them in an amicable way.

  • Mr. Poppers says:

    So let me get this straight … the union pays zero dollars out of their pocket for healthcare and the company is asking them to pay a small portion leaving them in a much better position that a majority of American’s who are paying their share of healthcare and thats unfair? I am not in favor of the corporation sticking it to the little guy all the time but how is it fair that i work my tail off, pay my fair share of health care benefits, and don’t have nearly the benefits the union workers do ? doesn’t seem right if you ask me and i do think they should pay something. Remember your not entitled to a job just b/c your in a union or not….

    In other news the union shows how it plays fair:


    The criminal incidents of sabotage have affected phone, Internet and TV service in Maryland, Massachusetts, New Jersey and New York.

    The acts of sabotage include:

    Ten incidents of fiber-optic lines being deliberately cut in the Bronx, Pomona, Farmingdale and Guilderland in New York; two separate incidents in Tewksbury in Massachusetts; incidents in Bel Air in Maryland, and East Dover, Oakland and Plainfield in New Jersey.

    An outage due to stolen electronic equipment in Cedar Grove, N.J., affecting a local police department, among other customers.

    An incident due to tampering with a heating system at a central office in Manhattan.

    “These acts of sabotage are reprehensible,” said Verizon Chief Security Officer Mike Mason. “In addition to inconveniencing our customers, these deliberate disruptions of our network have affected hospitals, paramedics, fire fighters, law enforcement and other first responders. Verizon is working closely with local authorities to investigate these sabotage incidents, and identify and prosecute those responsible to the fullest extent of the law. And we will not hesitate to terminate any employee who may be involved in these acts.

    “In addition, there have been circumstances where union picketers are showing contempt for our customers by illegally preventing us from accessing the tools we need to serve them,” said Mason. “We are taking legal action to end this unlawful activity.”

    Verizon has obtained a statewide injunction against illegal picketing activities in Pennsylvania, and is pursuing similar action elsewhere.


    If you ask me they are a bunch of whiners, complainers, babies who don’t know how to work and i do hope the union’s back is broken.

  • Anon says:

    maybe they should shut down wireline (and the army of employees, pensioners, etc) and give everyone a 4G mifi ?

  • Stranger says:

    I really hope Verizon sticks it to the Union and hires all new employees that are happy to have a job in rough times.
    Verizon, remember that Scabs cover the wound created by big labor extortion and protect it from the infection called Unions!

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