NEW YORK, July 31, 2015 /PRNewswire/ -- After nearly
seven weeks of challenging negotiations, Verizon is preparing for
all potential scenarios following the expiration of its contracts
with the CWA and IBEW, covering more than 37,000 Wireline employees
in the Northeast and Mid-Atlantic regions. The contracts expire at
midnight, Aug. 1, 2015.
While the company presented union leaders with a comprehensive
initial offer on June 22 that
included a solid wage increase, union leaders countered with a
series of proposals that did virtually nothing to advance the
progress of negotiations.
"Employees are eligible to receive up to five weeks of paid
vacation time, not including paid sick days and paid excused days,"
said Marc Reed, Verizon's chief
administrative officer. "While we're willing to consider all
offers, union leaders came back with counterproposals that would
offer up to 19 additional days off, including new holidays,
employee birthdays, more vacation days and additional sick days.
That sort of proposal is unrealistic and out-of-touch in today's
marketplace."
Among other items in the unions' counterproposals:
The Elimination of All Healthcare Premium Contributions:
In the 2012 contract, for the first time, this work group started
making modest contributions toward its healthcare premiums. Now,
union leaders want to move in the other direction by fully
eliminating all employee premium contributions. In 2014, Verizon
spent over $1.4 billion on healthcare
for active and retired East associates.
Retirement Benefits: Union leaders want to increase the
401(k) match to 100 percent on the first 6 percent of compensation,
and significantly increase pension benefits for employees and
retirees. In addition, the Mid-Atlantic unions have proposed that
those who already retired with a lump-sum payment should get a
pension increase.
Job Security: Expand pre-2003 legacy job security
provisions to those hired in the future.
Tuition Assistance: In Mid-Atlantic, the unions proposed
no criteria at all for tuition reimbursement, and raising the cap
on tuition reimbursement to $12,000
from the current $8,000. The CWA also
proposed covering classes taken by employees' dependent children,
including paying off student loans. The New York and New
England unions are proposing to eliminate the $8,000 cap on tuition reimbursement and extend
tuition reimbursement to medical and aviation classes.
"In a highly competitive marketplace, we are working hard to
position Verizon's Wireline unit on a path towards success," said
Reed. "Unfortunately, the unions' current proposals fall short of
that goal."
In turn, Verizon's initial offer included a 2 percent increase
in each of the first two years and a lump sum increase in the
third.
In addition, considering the challenges that the company's
Wireline unit is facing, Verizon has asked the unions to work with
the company on making changes to the company's healthcare and
pension benefits, modifications that would help the company better
compete in the digital world.
For instance, implementing cost controls for the company's
healthcare plans is essential. The cost of medical coverage for an
East associate and one or more family members currently averages
nearly $20,000 a year. In one of the
company's East plans, the annual cost for this coverage is over
$23,000 annually. The company is
proposing an increase of $8.10 per
week next year for individual healthcare premiums in its sponsored
plans. In addition, the company is seeking reasonable increases to
co-pays, deductibles and out-of-pocket maximums.
With the company's pension proposal, pension-eligible associates
would be given a choice of continuing to earn pension benefits
under the defined benefit plan with some limitations and forgoing
the existing 401(k) company match, or opting for the enhanced
401(k) plan currently offered to management employees (which
includes a bigger company match and a profit-sharing contribution)
with a frozen pension benefit. Currently the vast majority of
employees under these contracts have both a defined benefit pension
plan AND a 401(k) savings plan with a generous company match, a
benefit structure that's from another era.
Reed added: "As more and more Americans forgo their home
telephones, we have a unique opportunity to put this Wireline unit
on a course that will benefit our workforce and our customers. We
truly hope union leaders seize an opportunity that will help
sustain solid middle-class jobs for our employees in 2015 and many
years to come."
In the meantime, Verizon is ready in the event of a work
stoppage. Over the past several months, thousands of non-union
Verizon employees and outside business partners have undergone
extensive training in various network and customer service
functions. The company stands committed to serve its
customers, 24 hours a day, 7 days a week.
Verizon Communications Inc. (NYSE, Nasdaq: VZ), headquartered in
New York, is a global leader in
delivering the promise of the digital world. Verizon Wireless
operates America's most reliable wireless network, with 109.5
million retail connections nationwide. Verizon also provides
converged communications, information and entertainment services
over America's most advanced fiber-optic network, and delivers
integrated business solutions to customers worldwide. A Fortune 15
company with more than $127 billion
in 2014 revenues, Verizon employs a diverse workforce of 178,500.
For more information, visit
www.verizon.com/news/.
VERIZON'S ONLINE NEWS CENTER: Verizon news releases, executive
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SOURCE Verizon Communications Inc.