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Possible Verizon Strike – What It’s About and How It May Affect You

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If you live in the Northeast or the telecom world, you may remember a Verizon strike by union employees last August. Approximately 45,000 Verizon union employees walked off their jobs when their three-year contract expired. They returned two weeks later when the two sides agreed on a structured plan to continue talks. Despite the efforts of both sides and federal mediators, there is still no contract in place, although the latest reports say they have made some headway.

The workers, who are members of the Communication Workers of America and the International Brotherhood of Electrical Workers, appear likely to strike within the next couple of weeks if an agreement can’t be made. Most of the workers are Verizon field technicians and call center employees in the Verizon wireline division in the Northeast.  These specific employees have been working without a contract since August, 22, 2011. The union would have to give seven days’ notice in advance of a walkout and Verizon would have to give the same notice before declaring new contract terms. No such notices have been confirmed yet as both sides agreed not to speak to the media.

The threatened strike is primarily about health care and pensions. Union employees are angry that Verizon reported increased second quarter earnings and pays its executives hundreds of millions of dollars, yet wants union workers to concede many of their benefits. They contend that Verizon wants them to pay a portion of their monthly health care premiums and freeze pensions to help offset decreasing revenue in the company’s wireline business. The telecom carriers have seen their wireline business deteriorate as people depend more heavily on mobile devices and less on their traditional land-based home phones. The workers are also fighting for the protection of disability benefits, job security, and the return of contracted-out and off-shored work.

Verizon’s wireless arm is also attempting to partner with cable companies to bundle wireless phone with cable's wireline packages. The unions believe this would eliminate Verizon's competitive fiber optic service (FiOS) broadband video service and cause the layoffs of FiOS workers. The unions have opposed the marketing agreement, putting pressure on the Federal Communications Commission and the Department of Justice to reject the deal as a monopoly.

How could this affect you? Based on last year’s strike, a walkout will likely slow, if not halt, phone and Internet service installation and delay repair work. Just prior to last year’s strike, Verizon relocated employees from Florida to the NE, trained tens of thousands of managers and retirees and others to make repairs and handle customer service calls. Yet, there were reports of many customers complaining of delays getting new service installed or existing lines repaired. For example, phone lines at an investment bank in Manhattan were down for nine days and installations were being pushed out at least four months.

This type of labor dispute seems to be the trend. Just this week, 20,000 union employees on the East and West coasts at AT&T have walked off the job due to similar contract issues. These strikes don’t bode well with consumers who rely on their services to run daily business. In the event that a strike does occur, ShoreTel will provide more detailed information on the projected impact to our customers with both existing deployments and pending installations.