45,000 Verizon employees have now returned to work following a two-week strike, but it seems the dispute is just beginning. The two sides agreed to resume negotiations but there are few signs of goodwill between them.
Verizon is the principal phone service provider in the Northeastern United States. Most of the workers in Verizon’s traditional landline telephone and popular new FiOS broadband/cable TV operations are represented by labor unions, chiefly the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW). But growth in wireless service has far outpaced wireline in recent years, and Verizon has successfully resisted union organizing on the wireless side of the house.
Union-represented Verizon workers stand out because they still enjoy participation in a defined-benefit pension and employer-paid health care. These benefits were fairly common for the last generation of workers but are becoming rare today, and Verizon wants to cut benefits to bring these workers into line with today’s labor market. (Bringing union working conditions down to the nonunion level would of course also remove a powerful incentive for wireless workers to organize and seek parity.)
The dispute has unfolded in a very public manner, with Verizon – and to a lesser extent, the CWA – taking out full-page advertisements in newspapers around the region. The union’s message in the ads has been pretty conventional. Verizon is making good profits and its management is very well paid. Why is the company trying to take away from workers the benefits they have secured over 50 years of labor and bargaining?
The company, on the other hand, has taken a rather bold approach in its public relations. They don’t say that they are losing money on wireline service. (They aren’t.) They hint that labor costs are the reason for the shrinking landline phone market, but don’t spell out a real strategy for reviving interest in landline service. (If consumers are choosing smartphones over landlines, cost is probably not the main reason – and Verizon hasn’t indicated it will use any givebacks to reduce consumer prices in any event.) Mostly Verizon just says that it’s unreasonable for workers today to enjoy pensions and fully employer-paid health care. Most other workers have lost them, so Verizon workers should too.
When GM and Chrysler went bankrupt, Americans -- understandably -- demanded that workers make major concessions before public resources were committed to salvaging the US auto industry. Verizon almost seems to be betting that many Americans are jealous and resentful of workers have retained good health and retirement benefits in this day and age, and will root for anyone willing to take them down a peg.