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Verizon workers defeat worst of bosses’ demands after 44-day strike

By David Hoskins |
June 7, 2016
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Verizon workers on the picket line
Verizon workers on the picket line (Fight Back! News/staff)

Washington, DC - Nearly 40,000 Verizon workers returned to work on June 1, just days after a tentative agreement between the company and the Communications Workers of America (CWA) and International Brotherhood of Electrical Workers (IBEW) unions brought their 44-day strike to an end.

The strike was one of the largest and longest in recent U.S. history, impacting 11 states in the northeast and south. According to the U.S. Bureau of Labor Statistics (BLS), 47,000 workers walked off the job in 12 major work stoppages for all of 2015. And this was actually higher than 2014, when just 34,000 workers walked off the job in major strikes tracked by the BLS across the U.S.

The rank-and-file CWA and IBEW members showed courageous determination in striking for more than six weeks to fight back against Verizon management’s concessionary demands. The workers’ last contract expired in August and their healthcare coverage was cut at the end of April.

The militancy displayed by Verizon workers beat back the worst of the bosses’ demands. Union leaders have declared the tentative contract a victory. Ultimately, workers belonging to both unions must vote up or down in the coming weeks on approving the contract deal before it can legally go into effect.

New contract deal brings many wins for workers, makes some concessions to Verizon

Competing reports in the capitalist press, such as the Wall Street Journal and Fortune magazine, and statements issued by the unions representing Verizon workers, paint a somewhat mixed picture of the tentative contract that is up for a vote by workers. One thing that is clear is that the new contract includes a lot of victories for workers and some concessions to Verizon management.

Attempts by management to force pension cuts and reductions in accident and disability benefits and eliminate layoff protections for certain classes of employees were successfully defeated by striking Verizon workers. The tentative deal between the union and Verizon management includes raises of almost 11% over four years, up from the 6.5% Verizon had originally offered, and the addition of 1300 new union jobs at call centers. Verizon retreated on some of its proposals to outsource work. Instead of the proposed pension cuts, Verizon workers will now receive a slight increase in pension benefits.

The agreement also provides an opening for the unions to organize low-wage wireless retail workers at the company’s 1700 retail sites by securing a contract for approximately 70 unionized workers at several Verizon stores in New York City and Massachusetts. The workers at these stores have been working without their first contract since joining CWA in 2014. Approximately 100 wireless technicians also won a contract. These provisions represent real wins for Verizon workers and illustrate the power that the working class has in withholding its labor.

However, the tentative contract represents a partial victory since concessions were made to some of the demands made by company bosses. Verizon secured new limits on retiree health benefits. The unions also agreed to take on hundreds of millions of dollars more in healthcare costs during the life of the contract and workers will now pay higher premiums and out-of-pocket expenses. Additionally, the company won more flexibility to route customer calls to centers around the U.S. and offer workers buyout options once a year to leave, without prior approval of the union. This could prove an important tool for the company to reduce the workforce over the life of the upcoming contract.

The increased premiums and out-of-pocket expenses come just a few years after the unions made historic concessions in the 2011-12 contract fight, including forcing workers to pay a share of health insurance premiums for the first time. The fact that Verizon came back harder and tried to take more after the 2011-12 concessions is an important lesson. The bosses’ appetite for concessions is insatiable. The more you undermine standards, security, and pay for workers by feeding concessions to management, the more concessions management will demand in the future.

These concessions to Verizon bosses come even though the company is incredibly profitable. Verizon’s own financial reporting shows that the company made $17.9 billion in net annual profit in 2015, up from $9.6 billion in 2014. First quarter 2016 Verizon net profits came in at more than $4.3 billion. Verizon has used this extraordinary profit to pay its CEO 200 times more than the average Verizon worker and provide the company’s top five executives with $233 million in compensation over the last five years, according to CWA.

Despite the concessions made to management, the Verizon workers’ partial victory, including the defeat of many of the most egregious takebacks proposed by Verizon management, would not have been possible without the strength and militancy displayed by Verizon workers by striking for an extended period of time.

Capitalist state intervention shows that the bosses fear worker militancy

In mid-May, U.S. Secretary of Labor Thomas Perez brought the company and unions back to the bargaining table so that he could use the authority of his office to intervene in the contract discussions. Perez recently issued a statement on the tentative agreement between Verizon and the unions, saying in part, “Today, I am pleased to announce that the parties have reached an agreement in principle on a four-year contract, resolving the open issues in the ongoing labor dispute between Verizon’s workers, unions, and management…This tentative resolution is a testament to the power of collective bargaining.”

Perez, who is sometimes mentioned as a potential vice presidential nominee for the Democratic Party ticket this fall, is careful to give lip service to the power of collective bargaining. However, strengthening collective bargaining is not the reason that the capitalist state intervened in the negotiations between Verizon and the unions. The motivating factor for the state’s intervention rests with the last line of the Labor Secretary’s statement, which simply states, “I expect that workers will be back on the job next week.”

The fact is that the Verizon strike saw a massive work stoppage pushed by tens of thousands of rank-and-file union members at a multi-billion-dollar company that services more than 112 million wireless connections and 7 million internet subscribers. Scab replacement workers hired by Verizon were doing a poor job of delivering service, and the Labor Secretary’s intervention was primarily intended to stop the strike from disrupting parts of the U.S. capitalist economy.

By intervening, both Verizon and the state recognized the power of rank-and-file workers engaged in militant action and acknowledged that strike activity can disrupt the establishment economic order, especially if it spreads across employers or industries. There are indications that the idea of militant strike activity, inspired in part by the visible Verizon workers’ strike, is gaining traction among the broader working class.

For example, thousands of United Food and Commercial Workers (UFCW) Local 400 members working at Kroger grocery stores in the Roanoke Valley area of Virginia voted to authorize a strike on May 18. That strike ultimately did not occur after the company invited the union back to the negotiating table and made some movement to further increase wages following the strike authorization vote.

It is important to note that many rank-and-file trade unionists are often ahead of their union leadership on taking militant strike action. The decision on whether and how long to strike is often shaped by a section of union leaders who are quick to collaborate with the boss and cut a deal before workers have exerted their full leverage in stopping production. This can often shorten the length of strikes in a way that is detrimental to worker demands or stop strikes in their tracks before they even get off the ground.

Still, the Kroger strike vote in Virginia shows that just the threat of a strike can sometimes be enough to bring the boss back to the table and extract some level of concessions, however minor. And the Verizon strike, despite some of the concessions contained in the tentative contract, demonstrates that prolonged and militant strike action is the path forward for the working class in this country to exercise its full power, extract real concessions from the company and eventually put the boss back on the defensive. Workers in this country need more strikes, not fewer.