And still Verizon wants more

August 16, 2011

Brian Tierney explains the background the big battle for U.S. labor at Verizon.

THE FIRST big strike in the new age of austerity has hit the United States.

When the clock struck 12:01 a.m. on Sunday, August 7, 45,000 Verizon landline workers from Massachusetts to Virginia struck the telecommunications giant--and nation's largest wireless carrier.

Since negotiations on a new contract began in June, Verizon has been demanding up to 100 concessions from the technicians and customer support employees in its wire lines division, which provides Internet and land phone lines. The workers--who are represented by Communication Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW)--voted overwhelmingly to authorize the strike.

The givebacks that Verizon is trying to squeeze out of striking workers are staggering in scope--especially considering that the company raked in $10 billion in profits in 2010--and $3.2 billion in just the most recent quarter of 2011. Over the last four years, the company's top five executives were paid a total of $258 million in salaries and bonuses.

Supporters picket in Madison, Wis., to show their solidarity with striking Verizon workers
Supporters picket in Madison, Wis., to show their solidarity with striking Verizon workers (Jenna Pope)

Verizon is also a notorious corporate tax-dodger that hasn't paid a dime in federal income taxes for the last two years--in fact, it received a $1.3 billion federal rebate from its 2010 tax bill.

And still the company wants more. Verizon's long list of proposals add up to $1 billion a year in concessions, equivalent to about $20,000 for every worker, according to the CWA.

Among the concessions being demanded, cuts to benefits and job security protections will have the most damaging impact on working conditions and living standards. Verizon is seeking to weaken job security provisions, pass 25 percent of health care costs onto workers, and freeze pensions for current employees, while eliminating them for future workers.

Additional cuts would get rid of accident disability benefits, slash sickness disability benefits, reduce the number of paid holidays and decrease maximum annual paid sick days to five--with workers with less than two years of seniority getting no paid sick leave at all. Verizon also wants a freer hand to outsource jobs to low-wage contractors and move work overseas.

Les Evans, president of CWA Local 2108 in Maryland, said the company gave the union no choice but to strike. "They're making billions, but are rolling back half a century of advances," Evans said, as a sea of red-shirted strikers and supporters gathered for a rally outside Verizon's Chesapeake Office Complex in Silver Spring, Md.

VERIZON CLAIMS that the givebacks it is demanding from workers are necessary because of years of decline in its copper landline business, which has suffered as customers turned more to mobile phones and to cable providers that bundle together landline and TV services.

Both unions have aptly pointed out the absurdity of Verizon--the largest wireless company in the country--maintaining it is losing business due to the increase in the use of cell phones over landlines.

Verizon has also been relying on talking points that claim technicians make more than $100,000 a year. In reality, such pay levels are a rarity that exists only for veteran employees who put in large amounts of overtime, something that isn't available to all workers. As the unions point out, the chairman of Verizon's board made $55,000 a day last year--many employees of the company don't even make that much in a year.

Members of the CWA and IBEW have been successful in the past at using work stoppages to resist concessions. Defending high-quality health care has been a key strength of Verizon contracts dating back to the 1980s--strikes in 1983, 1986, 1989, 1998 and 2004 largely beat back attempts by management to impose premium-sharing and other concessions.

But over the past decade, Verizon has steadily weakened the position of its union workforce. Since 2003, the company has managed to shrink its union workforce from 75,000 to 45,000 through the use of buyouts, job cuts and moving work to non-union subsidiaries. In the same period, Verizon's non-union workforce grew to 135,000.

These and other factors like increased automation make the company less vulnerable to a strike and pose a challenge for Verizon workers on the picket line today.

When the strike began, Verizon claimed in a statement, "Tens of thousands of Verizon managers and other personnel have been trained to step in and perform emergency work assignments," ensuring there would be "limited disruption in service."

But strikers say the scabs can't perform the jobs they do. Robin, a 37-year veteran of the company on strike in Washington, said, "This is on-the-job training. I was trained for years to do this work." Further north, according to reports, managers who are unable to fix or install anything have admitted they were dispatched to simply drive trucks around until they run out of gas.

Many picketers say health care is their most serious concern. A year and a half after the Obama administration's signature health care "reform" law that was supposed to increase coverage and affordability, high-quality health care is one of the main benefits under attack at Verizon.

But this is no accident, according to labor journalist and author Steve Early.

The excise tax that will be imposed on higher-cost health plans under the law has become a lever for companies to start pushing now for big reductions in medical coverage. The tax isn't scheduled to take effect until 2018, but as Early points out in a recent article, the battle over health care at Verizon shows that "this is the poison pill in [the health care reform law] that's already making union bargaining more difficult, even at hugely profitable firms."

In fact, last month, Verizon told workers that the company needed to start accounting for the costs of the tax now--seven years early.

THE STRIKE at Verizon is significant not just for its size, but the context in which it takes place. The last major strike in the telecommunications industry occurred in 2004--a four-day strike at SBC Communications involving 102,000 workers, according to the Bureau of Labor Statistics. The last U.S. strike larger than the one at Verizon involved 74,000 General Motors workers, who walked out for two days in 2007.

Those strikes were brief--and they preceded the global economic crisis that has been used by employers to batter workers' living standards still further, following decades of declines in real wages, unionization rates and living standards.

Due to new advantages Verizon has gained through outsourcing and other changes, CWA leaders have made it clear that conventional strike tactics won't be effective--so the union is, for example, targeting Verizon wireless stores to turn away customers.

But some rank-and-file workers are critical of union leaders who have suggested a return to work and resumption of bargaining if Verizon removes its take-it-or-leave-it proposal from the table. While CWA is in a weak bargaining position in many respects and IBEW locals don't even have strike funds, a return to work without a contract would make fighting off concessions that much more difficult.

For Jonathan Leonard, a 23-year Verizon systems technician and vice president of CWA Local 2336 in Washington, D.C., this strike is bigger than one company. "We need to take a stand, because if they can do it to us, they can do it to workers at other companies across the country," he said.

But the opposite is also true: If Verizon workers win, their victory would signal a shift in the battle lines in the war on workers.

This article is adapted from one first published at Subterranean Dispatches.

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