NEW YORK (Reuters) - Verizon Communications and two unions have reached tentative agreements for labor contracts covering about 43,000 technical and customer service workers in its wireline telephone business after more than a year of negotiations and a strike.
Verizon was looking to slash its wireline telephone costs to bring them into line with declining revenue at the business, which has faced a steady stream of customer disconnections in recent years as consumers favor cellphones over home phones.
But the unions had fought back, saying that it asked for too many concessions in areas such as job security, pensions and healthcare contributions for the workers, which represent about half of Verizon's wireline workforce.
Under the new agreement, Verizon failed in its effort to freeze pension plans and change some job security provisions, but it prevailed in making the workers contribute for healthcare benefits, according to a union communication with its members.
Guggenheim Securities analyst Shing Yin said it seemed "at first glance that Verizon had probably made more concessions than the union."
But Yin described the news as a "mild negative" and said he expects Verizon shares to hold steady because investors were not "expecting the contract to be very positive for Verizon" after the long drawn-out negotiations.
The new contracts with the Communications Workers of America and the International Brotherhood of Electrical Workers would run through August 1, 2015, if they are approved by the workers.
Current employees maintain their pensions, but employees hired after ratification will receive 401(k) plans.
Job security language from the old contract is kept as is, according to Reuters (itself a union-busting organization.)
Agreeing to a 401(k) for new employees seems like a really big concession to me.