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Contract protects jobs but cuts health care
CWA gives ground at SBC

By Lee Sustar | June 4, 2004 | Page 11

WORKERS AT telecommunications company SBC won some contract gains with their four-day strike last month, but retreated on the key issue of health care and made other concessions as well.

The 100,000 workers in 13 states--mostly in the West and Midwest--are members of the Communications Workers of America (CWA) and will vote on the tentative agreement reached May 25 after their strike ended.

Workers' views of the deal are mixed. After all, SBC is profitable--to the tune of $8 billion last year--and CEO Ed Whitacre got an astonishing $20 million in compensation, compared to the $50,000 average pay for CWA members. Many said they would vote for the deal reluctantly. "It's not that great, but if we went out on strike [again] we'd probably lose more, like the Southern California grocery strike," an SBC worker in San Francisco told Socialist Worker.

The strike did pressure SBC into agreeing to more job security for technicians' jobs. The proposed contract stipulates that CWA members will do customer contact and technical support, do fiber optic cable wiring to customers' premises and handle the emerging voice-over-Internet technology.

However, the CWA failed to win an agreement on outsourcing of customer service jobs. Management and the union will only "discuss" bringing outbound telemarketing calls into the bargaining unit, and the contract highlights given to workers are silent on the call-center jobs that SBC has already outsourced--some 3,000 overseas and 20,000 to nonunion companies in the U.S.

Wage gains are also poor--2 percent the first year, and 2.5 percent in years two through five, with a small cost-of-living adjustment in the final two years. A lump-sum payment equivalent to 1 percent of annual payment will be added to pay this year--but lump sums won't become part of the base pay used for future wages and benefits.

In any case, health care costs will eat up a growing proportion of workers' pay. The agreement will raise office visit co-pays--a key issue in the strike--from $10 for office visits today to $15 in 2005 and $20 in 2007. This is less than management's demand for a $30 co-pay by 2009--but it's only one part of what will be a big increase in out-of-pocket health care costs. Emergency room co-pays will jump from the current $25 to $50 next year and $75 by late 2008.

What's more, workers whose spouses are covered under the SBC plan will have to pay a $40 per month surcharge unless the spouse earns less than $25,000 per year or has health premiums that would otherwise cost more than $900 per month. Prescription drug prices will increase as well.

Retiree health care will take an even bigger hit, even after the CWA pressured SBC into making a $2 billion payment into the retiree health care fund. Office visit co-pays will rise to $15 by 2005 and reach $30 by 2009, while emergency room visits for retirees will require a co-pay of $75.

The health care givebacks parallel those made by the CWA at Verizon last year. Both contracts make it clear that the CWA leaders' strategy isn't to wage an all-out fight against health care concessions even at these hugely profitable companies, but rather to moderate the givebacks by taking smaller pay increases As one San Francisco SBC worker put it, "We deserve better. It's like a slave factory in there. No respect. I'm voting 'No.'"

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