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Unionized AT&T workers go on strike

Fortune logo Fortune 5/19/2017 Aaron Pressman

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Unionized workers at AT&T went on strike on Friday afternoon, signaling the end of more than four years of labor peace at the company.

AT&T and the Communications Workers of America union couldn't come to an agreement in time to meet the union's 3 p.m. deadline, the union said on Friday. Workers in AT&T wireless stores in 36 states and Washington, D.C. walked out along with workers in the company's traditional wired phone and Internet business in California, Nevada, and Connecticut. The CWA says the strike will last until Monday morning.

The workers say they want wage increases, no increase in health care contributions, and tighter job security protection against outsourcing—both for call center jobs that could be moved overseas and retail store jobs shifted to third-party chains. For store workers, sales commissions are also a hot issue.

AT&T says it has offered "generous" wage and pension benefit increases and health care benefits similar to what other unionized employees have accepted around the country.

"AT&T continues to pinch its workers' basic needs and stand in the way of high-quality service its customers pay good money for," Dennis Trainor, vice president of the union's District 1, said in a statement. "This is a warning to AT&T: there’s only one way out of this now—a fair contract—and we’ll settle for nothing less."

The company said it was still eager to reach a deal. "We're all family, whether you're a union member or not," an AT&T spokesman said. "Like any family we have our disagreements but we'll sort them out." But the company is under increasing pressure on Wall Street to cut costs, as revenue in both its older wired telephone business as well as the once-fast-growing wireless unit has declined.

CWA workers at AT&T have been ramping up their picketing activity over the last few months. And on Friday, many were posting plans to go on strike on Facebook with pictures of their handmade signs and videos of kids singing protest chants. 

Cheryce Chambers, who works at an AT&T wireless store in the Bronx, New York, walked out on Friday afternoon along with her colleagues. Chambers says she has had difficulty supporting her 11-year-old son as her wages have declined over the past decade. "The walk out this weekend will definitely get the message across," she said. "We do a lot for this company. We are the core of it."

The strike comes after about 40,000 employees have been working without a contract. If they all strike, the walkout would rank as the third-largest in the past 10 years by the number of employees involved. The massive telecom industry walkout follows last year's bitter, seven-week strike by 36,500 Verizon employees. That standoff wasn't resolved until then-Secretary of Labor Tom Perez got involved to mediate between the two sides.

But while Verizon has had a long history of difficult labor relations, AT&T has had good relations with its unionized workforce recently.

The carrier hasn’t suffered a labor strike since 2012, and that lasted only two days. A recent four-year contract ratified in April by 20,000 workers in Arkansas, Kansas, Missouri, Oklahoma, and Texas marked the 28th straight deal approved by AT&T and its unionized workers since the start of 2015.

As part of the deal, AT&T agreed to hire 3,000 people locally for jobs that had been outsourced, mostly overseas. The company also reached a deal with the International Brotherhood of Electrical Workers in April agreeing to hire 1,000 workers and add a call center in Chicago.Unlike the Verizon strike, the CWA has set a firm end to Friday's walkout Monday.

That could be a signal that despite the tough negotiations so far, the two sides are less divided than Verizon and its workers were last year.



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