Accords at Baby Bells

Monthly Labor Review, Nov, 1995 by Michael A. Cimini, John K. Steinmeyer

Five regional Bell telephone companies signed tentative 3-year collective bargaining agreements with one or both of their two major unions, the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW). These contracts settled disputes over wages, job security, pensions, and health insurance costs. The pacts cover more than 200,000 telephone operators, clerical employees, sales and business representatives, lineworkers, and other production and maintenance workers at Ameritech, BellSouth, Pacific Telesis, Southwestern Bell, and US WEST.

The two unions and the five Bell operating companies began separate negotiations in June to replace contracts that were scheduled to expire in August. Early settlements had already been reached at NYNEX by the CWA and the IBEW in March 1994 and at Bell Atlantic by the IBEW in May 1995. (See Monthly Labor Review, January 1995, p. 35, and August 1995, p. 74.)

The Bell contracts expired in August without the parties reaching an agreement. Four of the contracts - at Ameritech, BellSouth, Pacific Telesis, and SouthWestern Bell - were then extended on a day-to-day basis, although employees had authorized strikes at some of the companies.

The first of the five recent settlements was at SouthWestern Bell, where the company and the CWA agreed to a contract covering some 39,000 workers in Texas, Arkansas, Missouri, Oklahoma, and Kansas. The pact provides wage increases averaging 11 percent over the term of the contract plus "significant job upgrades." Other terms establish a "variable pay plan"; increase flexibility in scheduling time off, introduce a pretax medical reimbursement account, and add a new employment security provision that increases employees, flexibility in "surplus situations."

One day later, Pacific Telesis and BellSouth negotiated similar accords with the CWA. Both contracts called for wage increases of approximately 11 percent over the 3-year term for most bargaining unit employees. The Pacific Telesis accord covered 58,000 workers in California and Nevada. The BellSouth agreement covered 58,000 workers in nine southeastern States, including North Carolina, South Carolina, and Georgia.

In addition to the wage increases, the Pacific Telesis accord calls for a 14-percent boost in pension benefits, a $16 million training and retraining program, enhancements in work and family life provisions, and improved health care benefits. The pact includes a number of provisions protecting employees adversely affected by downsizing, including an enhanced severance package with continuation of health care benefits for a specified period, and a new voluntary retirement option that credits employees with 4 additional years of age and service and provides retirees with an additional 30 percent in pension benefits to be paid as a supplement until they reach age 62. Other employment security-related provisions enhance employees, transfer rights, and offer more options for employees who are facing layoff, including a 20-percent increase in relocation allowances and greater opportunity to voluntarily transfer within the company.

The BellSouth pact also reportedly strengthens employees, job security rights by expanding reassignment options within the company; improves training programs to assist employees to qualify for jobs at BellSouth or its subsidiaries; and enhances "income protection options" for laid-off workers. Other terms improve health care benefits, call for a $1,100 lump-sum payment in the first year of the contract and payments in the same amount in cash or BellSouth stock in the second and third years, establish an employee stock purchase plan effective in April 1996; and increase pension benefits by between 17 and 20 percent.

Three days after the Pacific Telesis and BellSouth settlements, the CWA and the IBEW signed separate but similar 3-year contracts with Ameritech for about 43,000 workers in Michigan, Ohio, Wisconsin, Illinois, and Indiana. The pacts provide a $500 ratification bonus, a 3.5-percent wage increase retroactive to the expiration date of the prior contracts, and additional 3.5-percent in creases in both the second and third years of the contracts. In the benefit area, the contracts increase pension payments by 12 to 15 percent; improve and enhance training and educational benefits, and guarantee that health care premium costs will not be shifted to active or retired employees, while improving the vision and dental care plans. Other terms provide workers with security from involuntary layoffs by expanding opportunities for employees to fill available jobs at all locations within their geographic market area, and give the unions new rights to organize Ameritech subsidiaries.

A week later, US WEST Communications reached agreement with the CWA on a new 3-year agreement covering nearly 33,000 employees in 14 western and midwestern States. The pact provides a $1,500 signing bonus and wage increases of 3.6 percent in the first year of the contract and 3.5 percent in the second and third years. The contract boosts pension benefits by 12 percent, enhances the 401(k) savings plan and the educational assistance program, and improves dental coverage. Other terms guarantee that retirees will not pay health insurance premiums until at least 2002; change work rules to give the company more flexibility in serving customers, and strengthen a company-paid retraining program designed to upgrade employees' skills so that they can qualify for new jobs in the company. A separate but identical contract between the company and the IBEW was negotiated to cover 500 employees in Montana.