‘Breakthrough' Verizon deal reached, staving off strike

Wages, pensions boosted; 2,500 union jobs to be created

The current contract was originally slated to expire at midnight Aug. 2. The unions agreed, in light of progress in negotiations, to "stop the clock" on the contract expiration and postpone strike action while talks continued. But with progress slow, on Friday the unions set a deadline of 12:01 a.m. Monday or a strike vote could be called.

The settlement achieves "major goals of promoting union jobs, expanding bargaining rights, providing medical insurance benefits for both current and retired workers," as well as increasing wages and pensions for 65,000 workers from Virginia to Maine, according to a statement by the Communications Workers of America and International Brotherhood of Electrical Workers.

Meetings will now be held among union members to review the agreement, with a ratification vote expected "in a few weeks," according to Candice Johnson, CWA spokeswoman.

"The agreement is very positive for everyone," Johnson said.

"This has been a complex process involving several bargaining tables and a number of local matters, which we respectfully addressed," said William R. Roberts, Verizon's regional president for Maryland and Washington, D.C. "We settled on a contract that is fair to all parties involved. With this agreement in place, we now can focus on the important business of competing and offering choice to customers for their phone, Internet and TV services."

"This is a breakthrough agreement in many ways," said CWA President Larry Cohen in a statement.

"It creates new union jobs, including major growth areas like FiOS, it takes a big step forward on health care and it brings hundreds of Verizon Business employees the union rights they deserve," Cohen said. "We applaud management for agreeing to keep the best health coverage in America and for their commitment to work with us for real health care reform. This settlement provides a framework for growth at Verizon and a good standard of living with careers for our members."

The settlement calls for wage increases totaling 10.87 percent compounded over the three-year contract term. Pension payments also will be increased by 10.87 percent compounded over the term of the agreement.

The tentative settlement also eliminates subcontracting of work in a number of job areas, converts many temporary jobs to permanent ones and brings additional jobs associated with Verizon's FiOS, or fiber optic, technology into the union bargaining units, the unions said. Overall, the settlement is expected to create 2,500 new union jobs.

"We approached the bargaining tables with an interest in solving problems, and the result is an agreement that will keep us focused on delivering to our customers the best in broadband, communications and entertainment," said Marc C. Reed, executive vice president for human resources, Verizon Communications, in a statement. "From the start, our goal has been to continue to provide our employees with a package of competitive wages and benefits."

The issue of medical insurance costs and benefits was a major focus of the negotiations and the settlement preserves fully paid insurance premiums for all current and retired employees. Future hires are to have a defined contribution formula for retirement medical insurance, with the amount of Verizon's contributions subject to negotiation in subsequent contracts.

In addition, the settlement calls for Verizon to work with the unions to achieve meaningful reform of the nation's medical insurance system, with the company providing $2 million per year to the project.

"The intent is to explore policy options and put together a program to support health care reforms to provide universal health care coverage," said CWA spokesman Jeff Miller.

According to union information, another key element of the agreement is that Verizon will extend union recognition to 600 former MCI technicians at Verizon Business who have been seeking representation for nearly two years. These workers, who perform the same jobs as the union work force, have received strong support from CWA and IBEW members in a campaign to "tear down the wall" between union and non-union sectors at Verizon. The agreement also includes new opportunities for union workers to provide customer support and service at Verizon Business.