On August 7, 2011 45 thousand employees for Verizon went on strike. They were upset about the drastic reductions that were proposed in benefits from the management of the company. To include: changes in work rules, cuts to pensions and reductions in health care. The combination of these factors created a situation where the management and employees were at an impasse. To fully understand the situation there will be a focus on: prior work stoppages, events leading up to the strike, the position of the company, the views of the union, what lead to a breakdown in negotiations, the resolution of the conflict, any lingering issues and winners / losers. Together, these different elements will highlight crucial areas of contention and how they were addressed. (Kaiser, 2011)
Prior work stoppages (if any)
This strike was the first work stoppage affecting the company since the merger from NYNEX, Bell Atlantic and GTE. However, under Bell Atlantic there was a strike from employees in 1998 when 73 thousand staff members walked out. At the heart of their concerns, were proposed reductions in benefits and the company's desire to hire nonunion employees in the wireless divisions. The management backed off these demands and allowed the union to continue receiving similar benefits in the agreement that was reached between the two sides. ("Bell Atlantic Pact," 1998)
Moreover, the Bell Atlantic had another strike involving 41 thousand workers in 1989. At the time, the company was seeking a reduction in wages, to hire non-unionized employees and health care benefits. After walking off the job for the 13 days, the management agreed to give into the union's concessions. These areas are showing how there is a history of contention between the union and company officials going back many years. (Kennedy, 1989)
Events leading up to work stoppage
The events that are leading up to the work stoppage is the management wanted to see a decrease in wages, pensions, the costs for health care benefits and changes in workplace rules. What was happening is the Verizon felt that these changes were necessary to help the firm remain competitive and make adjustments to changes in the marketplace. At the same time, the company is seeing losses from customers who are using their traditional land line services. Instead, they are switching to mobile applications and the Internet. To mitigate the losses from this division, the firm is asking the union to make changes in their labor agreement. When they failed to reach a consensus on a new contract is when the employees began to strike. ("Verizon Strike of 2011," 2011)
Position of company - Things the company is trying to achieve through negotiations
Like what was stated previously, the company wants to have greater amounts of flexibility in making adjustments to the labor force and their cost structure. This means that some kind of changes must take place in the contract between management and the union. At the same time, they have one division that is losing money and others that are seeing an increase in profits. The combination of these factors have created a situation where there needs to be changes in this relationship. ("Verizon Strike of 2011," 2011)
Position of Union - Items the union hopes to achieve through negotiations
The union is trying to protect the existing benefits that are in place. At the same time, they want to see the company increase the number of unionized employees inside the other divisions, more controls in how layoffs take place, an increase in wages, pensions and health care benefits. According to union officials, the firm is realizing significant increases in their profit margins from the other divisions. This means that they should offer employees these options in order to improve safeguards when it comes to labor practices. ("Verizon Strike of 2011," 2011)
Discussion of work stoppage - Discuss breakdown in negotiations that led up to work stoppage
What led to work stoppage are the differences in viewpoints between the two sides. This because the management claims that dramatic cuts are necessary in order to help the company remain competitive in the future. While the union will claim how executives have been seeking these kinds of reductions for many years. Despite these assertations, the firm is one of the largest telecommunications carriers (who were able to make the transition to wireless and cable). According to the union, this is sign that the firm is evolving with new challenges using the existing labor agreement. Moreover, they want to see an increase in the total amounts that are contributed to employees' wages, pensions and health insurance. This is because the costs for workers are continuing to rise. ("Verizon Strike of 2011," 2011) (Kennedy, 1989)
Resolution of conflict - Discuss concessions made by both sides and compare with the original demand
For over a year, the two sides continued to go back and forth over these issues. This occurred after employees were allowed to return to work (while a new agreement was reached). After the discussions were going nowhere is when federal mediators stepped in. Under the new agreement the union is able to receive a number of benefits including:
Contracts that maintain the workers' standard of living and employment security.
The reaffirmation of employees bargaining rights.
Union members who were fired during the 2011 strike are allowed to return to work.
The extension of the agreement to 70 wireless technicians. ("CWA Reaches Tentative Agreement with Verizon," 2012) ("Verizon, Unions Reach Tentative Contract," 2012)
These areas are showing how management conceded on a number of demands. This is in line with many of the union's requirements prior to the work stoppage. At the same time, they were able to include the extension of these provisions to technicians in the wireless division and those fired during the strike. This is showing how employees were able to receive more benefits after the strike. ("CWA Reaches Tentative Agreement with Verizon," 2012)
As far as the company is concerned, they were given greater amounts of flexibility in determining when layoffs will take place and the union agreed to cover more of the health care expenses. In this aspect, Verizon only received part of the concessions they wanted. This is because they were unable to reduce wages, pension costs, make changes to workplace rules and decrease the number of unionized employees. As the concessions that were made, are giving the employees most of what they wanted with only minor changes in the labor agreement. ("CWA Reaches Tentative Agreement with Verizon," 2012) ("Verizon, Unions Reach Tentative Contract," 2012)
Any lingering issues?
The lingering issues are that the management of Verizon will continue to want similar kinds of concessions from workers in the future. This is because the fixed line division is losing money and executives want greater amounts of flexibility in making adjustments. At the same time, the union wants to see an increase in benefits and greater protections for employees. Over the course of time, these issues will lead to work stoppages and other challenges when the existing contact is up for renewal in 2015. Furthermore, the employees have not voted on the agreement. If it is not accepted, this could result in both sides having to return to the negotiating table. ("CWA Reaches Tentative Agreement with Verizon," 2012) ("Verizon, Unions Reach Tentative Contract," 2012)
Who was the winner and loser in your opinion?
The winner was clearly the union. This is because they were able to receive most of the concessions they wanted from the management. At the same time, they increased their protections to Verizon Wireless engineers. This is a sign that the agreement is helping the employees to maintain and improve their benefits. ("CWA Reaches Tentative Agreement with Verizon," 2012) ("Verizon, Unions Reach Tentative Contract," 2012)