Negotiation Case Studies July 20, 2009

Negotiations in the Spotlight: AT&T and CWA

AT&T and Communications Workers of America

After five months of negotiations, AT&T and the Communications Workers of America (CWA) have reached a tentative three-year agreement on a new labor contract. The deal affects about 18,500 “core wire-line” (those who work in AT&T’s wired phone division) in the Midwest. The deal is pending ratification by the union membership.

Negotiators for the union were focused on three issues:

1. Maintaining and improving employees' standard of living.
2. Protecting retirees.
3. Enhancing employment security.

The newly negotiated contract terms include annual pay raises, pension increases, and provisions for cost-of-living adjustments. Workers also get more opportunities to switch jobs within AT&T.

A sticking point in the negotiations was the issue of healthcare benefits. The deal that was hammered out will include fully funded preventive care and company-funded health reimbursement accounts that can be used towards eligible health-care expenses.

Commenting on the negotiations, AT&T CEO Randall Stephenson said: “These were tough negotiations in difficult economic times and amidst major changes in our wireline business.”

According to the Indianapolis Star, AT&T's wired business has been losing revenue as more people switch to cell phones and Web-based communications.

Negotiations are still ongoing to discuss contracts covering more than 100,000 workers.

This negotiation between a corporation and its union illustrates the effect of the tough economy. The corporation (AT&T) making the case it is losing business and the union making the case for better job security and benefits in an environment of rising employee uncertainty.

Information for this article came from Reuters and the the Indianapolis Star.