Despite $18 Billion in Profits in Last 18 Months, Verizon Still Insisting on Slashing Job Security, Health Care, and Retirement Security; Unions Will Continue to Fight for Good Jobs, FiOS Buildout, and Quality Service. With Company Refusing to Bargain Seriously, Union Bargaining Teams Leave Round-the-Clock Talks; Unions Remain Prepared to Bargain.
CWA Press Release
Aug 1, 2015
New York – Leaders of the Communications Workers of America and the International Brotherhood of Electrical Workers announced that 39,000 Verizon workers up and down the East Coast will work without a contract when their collective bargaining agreement expires at midnight tonight, and continue their fight for a fair agreement while on the job.
The union leaders also announced that they will leave the sites of round-the-clock bargaining in Philadelphia and Rye, NY, where union and management teams have been meeting since June 22nd in what has so far been a vain attempt to reach a contract. The unions have informed the company, however, that they are prepared to schedule regular bargaining sessions, and urged the company to begin bargaining constructively.
“Despite our best efforts, Verizon refuses to engage in serious bargaining towards a fair contract,” said Dennis Trainor, Vice President for CWA District One, which represents Verizon workers in New Jersey, New York and Massachusetts. “Verizon has earned $1billion a month in profits over the last 18 months, and paid its top handful of executives $249 million over the last 5 years, but continues to insist on eliminating our job security and driving down our standard of living. We’re not going to take it, and we’re going to keep the fight going while we’re on the job.
“The company has barely moved off its initial June 22nd proposal that made outrageous demands of Verizon workers. If this company is serious about reaching an agreement, it needs to start bargaining constructively and now, “said Ed Mooney, Vice President for CWA District 2-13, which represents Verizon workers from Pennsylvania to Virginia. “Right now there isn’t even anyone across the table from us who’s got the power to make any decisions.”
Verizon has not significantly moved off its outrageous initial bargaining demands, made on June 22nd, which includes the following proposals:
- Completely eliminating job security and gaining the right to transfer workers at will anywhere in the company’s footprint.
- Increasing workers’ health care costs by thousands of dollars per person, despite the fact that negotiations in 2011-2012 have cut the company’s health care costs by tens of millions of dollars over the life of the past contract.
- Removing any restrictions on the company’s right to contract out and offshore union jobs. This comes on top of Verizon’s outsourcing of thousands of jobs in recent years.
- Slashing retirement security.
- Reducing overtime and differential payments.
- Eliminating the Family Leave Care plan, which provides unpaid leave to care for sick family members or care for a newborn.
- Eliminating the Accident Disability Plan, which provides benefits to workers injured on the job.
At the same time, Verizon refuses to build out FiOS to many underserved communities up and down the East Coast, and has abandoned upkeep of the traditional landline network, leading to extensive service problems for consumers. In these negotiations, the union members’ interest is linked directly to the public interest, since our jobs involve maintaining quality service on traditional landlines and building and servicing Verizon’s state of the art FiOS broadband network. Even in New York City, where Verizon pledged to make FiOS available to every customer by the end of 2014, the City’s Department of Information Technology and Telecommunications issued a report finding that the company was evading the buildout commitments it made under its 2008 video franchise agreement.
86% of our members have voted to authorize a strike if necessary, but we’re not going to walk into a trap set by Verizon. We’ll strike when we think it is the right time to strike, and that is not tonight,” Mooney added. “The ball is in their court – we are waiting for them to get serious.”
39,000 workers are currently negotiating new contracts at Verizon. Fortune Magazine ranked Verizon the 15th largest corporation in America in 2014, with revenues of $127 billion, profits of $9.6 billion, and market capitalization of $198.4 billion. Verizon had profits of $28 billion over the last five years, and paid its top five executives $249 million during that time.
On July 21st, Verizon reported profits of $4.4 billion in 2Q2015 on revenues of $32.2 billion. This came on top of $4.2 billion in profits in 1Q2015, which means Verizon has made $1 billion in profits every month for the last 18 months. The company also reported that during the first six months of 2015 it has paid out over $9.3 billion to shareholders in dividends and stock buybacks, an increase of almost $5.8 billion over the first half of last year. In the Wireline division, Operating Cash Flow rose to 23.5%, and operating income doubled, from 2.6% to 5.3%. FiOS continues to expand and succeed, now constituting 79% of Verizon consumer revenues on the wireline side, and achieving penetration rates of 35.7% for video and 41.4% for internet in markets where it is competing.
A damning audit of Verizon’s FiOS rollout in New York City found that Verizon has failed to meet its promise to deliver high-speed fiber optic internet and television to everyone in the city who wanted it. During its negotiations for a city franchise, Verizon promised that the entire city would be wired with fiber optic cables by June 2014 and that after that date, everyone who wanted FiOS would get it within six months to a year. The audit found that despite claiming that it had wired the whole city by November 2014, Verizon systematically continues to refuse orders for service. The audit also found that Verizon stonewalled the audit process.
In addition, rates for basic telephone service have increased in recent years, even as Verizon has refused to expand their broadband services into many cities and rural communities, and service quality has greatly deteriorated. Verizon’s declining service quality especially impacts customers who cannot afford more advanced cable services, or who live in areas with few options for cable or wireless services.
In 2005, New York’s Public Service Commission (PSC) eliminated automatic fines for Verizon’s telephone service quality failures, reasoning that “competition” would improve services. Instead, service quality plunged. In the 3rd quarter of 2010, Verizon cleared only 1.2% of out of service complaints within 24 hours, almost 79 percentage points lower than the PSC’s 80% requirement. Rather than reverse course, the PSC changed its measurements, cutting out 92% of customers from service quality measurements and consolidating 28 repair service bureaus into 5 regions. On paper, terrible service quality was almost miraculously transformed. In reality, service quality continued to decline.