Verizon Strike 2016: What Are The Issues Dividing Company, Unions?

Editor's Note: This article is part of an ongoing series. Catch up on the latest news about the Verizon strike here.

Verizon has put forth its “final offer” to almost 40,000 striking employees. But will union members accept the communication giant’s terms?

“Verizon presented what it described as its ‘last, best, and final offer’ to your bargaining teams in Philadelphia and Westchester,” leaders with the CWA District 1 bargaining team stated after meeting with company representatives on April 28.

“Unfortunately, their ‘last and best’ was little more than the same old [expletive]," union leaders wrote.

Union representatives are alleging that even though Verizon made $39 billion in profits over the last three years, the company wants to “gut job security protections, contract out more work and send jobs overseas, and require technicians to work away from home for as long as two months without seeing their families.”

“Executives refused to back off of callous proposals that would hurt working families and destroy middle class jobs,” union leaders stated. “The company also failed to budge on the issues facing Verizon Wireless workers.”

“We will continue bargaining and striking until we get the contract that you deserve,” union leaders concluded.

Read the full CWA statement in reaction to Verizon’s April 28 contract offer here.

THE PROPOSED CONTRACT

On April 28, Verizon presented each of the striking workers’ bargaining units – the New England, Mid-Atlantic and New York IBEW and the New York/New England and Mid-Atlantic CWA – with separate contract offers, which can be seen here.

Each contract contains similar details, which Verizon summarized in a series of online videos.

“It’s unfortunate that union leaders have denounced our proposal,” Reed stated. “Their reaction to our offer does nothing to benefit our employees who are not where they should be – back at work and serving our customers.”

• See related article: Verizon Strike: Bargaining Not Going Well, Union Reps Say

Union representatives are alleging that even though Verizon made $39 billion in profits over the last three years, the company wants to “gut job security protections, contract out more work and send jobs overseas, and require technicians to work away from home for as long as two months without seeing their families.”

WAGE INCREASE

Verizon had previously stated that the striking employees have a wage and benefit package that averages more than $130,000 a year.

However, union leaders have asserted that the average salary of the striking Verizon workers is closer to $74,000 a year.

“Customer service reps average about $69,000 a year, and highly skilled technicians, who install or service FiOS and have five or more years of experience, top out at $84,600 in New York and about $76,000 elsewhere.”

According to Verizon, workers would receive a 7.5 percent salary increase over the term of the proposed contract, up from a previous offer of 6.5 percent.

However, union leaders have stated that the increase was made to trick workers into glossing over the rest of the company’s offer.

“If you [look further], you will find that the 7.5 percent will be eaten up by paying more for prescriptions, co-pays, deductibles and premiums,” union representatives stated. “Your gas cost will also increase due to travel above your current commute.”

JOB SECURITY

According to Verizon, if the unions agree to certain “workforce flexibility proposals,” job security for currently classified workers will continue for the term of the contract.

But union representatives counter that the proposal is a “path to eliminate all of us.”

Union leaders charged that the “workforce flexibility proposals” will mean:

• “We agree to sell out our members hired prior to August of 2003 and allow them to be transferred an additional 50 miles from the commute they have now”
• “We agree to close 11 offices and force 123 members to drive up to an additional 70 miles one-way”
• “[We agree to] a ‘special incentive offer’ for jobs [Verizon] contracts out with no guarantees of backfilling those jobs with internal or external hires”

PENSION

Verizon stated that under the proposed contract, workers who currently participate in the company pension will continue to earn service credit up to a maximum of 30 years, in addition to three, 1 percent annual increases.

“If you already have 30 or more years of service, you will keep everything you’ve already earned and you will receive the pension increases (assuming you are on payroll as of the date of each increase) but you will not earn any additional service credit,” Verizon stated.

In addition, the company match for employees’ 401K plan will continue, according to Verizon.

Union leaders claim that in layman’s terms, the company is attempting to “freeze the pension plan for eligible associates at 30 years.”

“They are also proposing to modify the cash out option,” union leaders stated. “The calculation method proposed will significantly reduce your lump sum cash out if you elect that option upon retirement. The 1 percent annual increase will effectively be negated by this new calculation.”

HEALTHCARE

Workers’ contributions towards their healthcare coverage will increase under the proposed contract, Verizon stated.

For example, employees with single coverage will have a $4.85 increase per paycheck in the first year of the contract, a $2.77 increase the second year and a $3.23 increase the third year, Verizon stated.

The proposed contract also has changes to employees’ deductibles and copays, as well as prescription drug coverage due to “escalating drug costs,” Verizon stated.

“The wage increases you will receive will be greater than the average increase in healthcare expense over the life of the contract,” Verizon asserted in its offer.

Union representatives countered that workers will see cost increases to their healthcare that include:

• A $325 increase to the managed care network deductible by 2018
• A $650 increase to “out of pocket” expenses by 2018
• A $1,128 increase to annual contributions for a family and a $564 increase for individuals
• A $1.60 increase to generic prescription drugs (retail) by 2018

“Today we have an open formulary, meaning the plan covers medications your doctors deem necessary,” union leaders stated. “[Verizon] proposes a closed formulary, meaning the plan will only provide medications the insurance company deems necessary based on costs for any particular condition.”

WORK ASSIGNMENTS

“Our earlier proposals could have allowed for assignment of technicians over great distances,” Verizon stated.

“We are focused on minimizing force imbalances in nearby states,” Verizon added. “We have narrowed this proposal so that you could not be temporarily involuntarily assigned to a location in another state outside New England if it would require an overnight stay (board and lodging). If you are a technician, you could be assigned to another state outside New England for up to 60 days in a year, but only to a distance that you could commute from at the end of the shift without staying overnight. We have offered to withdraw this proposal altogether if we reach a ratified agreement by May 20.”

Union representatives had this to say:

“This [stipulation] will be withdrawn if CBA is ratified by May 20, so it must not be critical to the company… This type of proposal should not be part of bargaining at this late stage.”

Photo via Stand Up To Verizon, Facebook

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