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[MUSIC PLAYING] SPEAKER: The following is a presentation of the ILR School at Cornell University, ILR, advancing the world of work.
MARY CATT: Good afternoon and welcome to ILR online. I'm here today with Professor Rosemary Batt who is an ILR School professor of Human Resource Studies, and also does a lot of work with industry performance. So she's perfect today to talk about what's going on in the aftermath of the Verizon strike. The contracts are voted-- will be voted on this coming week. I think all the tallies will be in by 1:00 next Friday.
So today, Professor Batt is going to unpack the proposals that voters are working on. As the Alice Hanson Cook Professor at Cornell University, she's spent much of her research time during the past two decades focused on industry performance and has done a great deal of work in the service industry, so is going to answer some questions that tell us what the contract provides for workers, what the significance of this win for workers is, and how things stand with this in terms of the rights of workers more broadly across the United States.
And also what it means for Verizon. And I think you're going to find some surprising answers to the questions I'll ask. So let's start, Professor, with what the contract provides.
ROSEMARY BATT: Well, first of all, thank you, Mary, for inviting me to be here. And I'm really thrilled to do so because I really have looked at the telecommunications industry over the last 20 years. And I care deeply about its development and the workers who work so hard to provide us with the service they do.
So I look at the contract and it's kind of useful to boil it down into about four areas that have seen improvements. So first of all is some basics on the wages that the union negotiated. And here we see quite decent increases of about 11% over the four years, which is 2 and 1/2% to 3% a year.
And if you think about that for nonunion workers who rarely get a pay raise, this is quite a very good increase. And then in addition, they're getting a signing bonus of about $1,000 each, so when the contract is concluded.
The second is that the company provided proposals to cut back the pension plan and the disability and accident insurance. And this is, again, where the union was able to push back and say, no. The Union has what is called a defined benefit pension plan, which is very important.
There are many workers that no longer have that. They have a 401(k). So this is very important to preserve. And they were able to get some increases from the company to contributions to that plan. So that's on stable footing.
More importantly, the third area that is critical is job security. So just to give you a little background, the union workforce, the key workforce in telecoms, is divided into two parts. So one side of the company is in customer service and sales. So those are the call center workers that we interact with all the time when we want to change our service. That's primarily a female-dominated workforce.
And then on the other side are the technicians who maintain and install and repair the infrastructure for the telecom industry. And that is primarily a male-dominated workforce, although they've changed. They've been kind of increasingly including more women, for example, in the tech force.
So key to this is that the company was going to outsource and offshore many call center jobs. And it was going to close, I think five centers, which would have been devastating for the women. And these jobs would have been sent to Mexico or Philippines or wherever. They prevented that from happening. And in fact, they're adding 1,300 new call center jobs. So then that's a huge success.
On the tech side, the company had proposed to increase contracting out of that technician work. And also to require a kind of forced transfer that the union techs would have to be forced to take jobs across states. And so think about the instability possibly created. You may have to give up your job if you have to transfer across a state. And they were able to push back on these proposals so they're no longer on the table.
And in addition, they negotiated 25% more jobs in the maintenance in New York State. So that job security is huge, particularly in this period when, as you probably know, many companies are contracting out work. And they're using more independent contractors. And so workers' jobs are becoming more uncertain and stable. And this contract says no.
Then the fourth piece is that there's a new contract for Verizon Wireless workers. Now this is an historic first, right, because the union since the 1980s has tried to organize the wireless workers, ever since wireless came into existence. And the company has been very fierce in preventing unionization. So this is a breakthrough. This is a historic breakthrough.
And not only that, but the union was able to negotiate more than what we call a first contract. So normally, a first contract, you would get basic union rights, like arbitration, grievance, just cause for dismissal, collective bargaining. But in addition, the union was able to negotiate job security for those workers. So there's a limit on contracting out.
The workers also get to shift some of the pay that was at risk to now guaranteed pay, OK? So now, for low-wage workers, they get a guaranteed income rather than having some of their pay be on commission. So these are all fabulous gains.
MARY CATT: Major victories for the workers.
ROSEMARY BATT: Really Impressive. Yeah. Surprisingly impressive.
MARY CATT: And hugely significant, given the context of what's going on in the rest of the world and in this nation. I'd like to remind our viewers that we welcome your questions. And we'll start answering them in probably about 10 minutes. But before we go to the questions, Professor Batt, would you talk about the significance this holds for workers more broadly and for unions, these victories by the Verizon workers?
ROSEMARY BATT: Yeah. I think that's really interesting because it's useful to put this into context, right? So here we have an unusually long strike in this day and age, six weeks. And it not only the union-- and it included both the CWA and the IBEW. They had to work together. They were successful in mobilizing. They were successful in getting out and going to headquarters and making this a very visible strike.
And it gives kind of inspiration to other unions to take this risk when they haven't been willing to do so or they've been worried about job loss. And it's also, we should put this in the context of a recent NLRB decision in which the NLRB has kind of backed off the striker replacement provisions that were in the PATCO decision back in the Reagan era.
And so companies will have to prove why they feel they can use strike replacement workers in the future. So this is provides inspiration to unions to say, we can be more assertive, we can mobilize effectively. We've seen it done. There are nurses strikes around the country right now. And so we're seeing more mobilization in the unions.
Then, just to push that one step further, it's in the context of broader mobilizations beyond the union movement. So we have the Fight for $15, we have Black Lives Matter, we have the fast food workers organizing. We have the new overtime rule by the Department of Labor which gives more workers the right to overtime pay.
We have many new laws that set the minimum wage at $15 an hour, say, in Seattle, in San Francisco, now in California, in the state of New York. And just yesterday, in Washington DC. So there seems to be a kind of bubbling up of mobilization around workers' rights. And this is part of that mobilization.
MARY CATT: OK. So what does all of this mean for Verizon?
ROSEMARY BATT: Well, so I think Verizon obviously is not happy with having had to go through the strike. And I think it may have underestimated the strength of the union and the ability of the union to mobilize. And the ability of the union to get public support.
And so Verizon kind of put its brand at risk, a little bit, in deciding to take the union on. And now what I think is it can restore that because the public, I think there's a broad view that the public feel that workers need more stable jobs. They need better pay.
And so because the public views this in this way, they don't want to see jobs offshored. They, the consumers, the customers of Verizon, don't want to see this, right? And so now the Verizon can say, well, we've done the right thing. We've backed off these proposals. We understand they're not appropriate. And we're going to honor the union contract and support our workers.
There's another piece of this, which is that-- so I've done years of research, empirical research, on the performance of call centers, and what human resource practices work or don't. And my research time and again has shown that if you have an experienced, skilled workforce long term, they are in the best position to provide the best customer service. And in turn, they also know how to package and sell more effectively.
So the unionized workforce is a real asset to the company. And even though they're paid more, they generate even more sales that are over and above what they are paid. And so it's really an important investment by the company to keep that experienced, skilled workforce, because they really will deliver good service.
And then finally, let me just say one other thing, which is that if a company outsources or offshores its call center work, then what it's essentially doing is giving that vendor access to all of its customers. And then that vendor won't treat Verizon customers any differently than AT&T customers or DirecTV customers or anything.
So strategically, it's not in the best interest of a company like Verizon to actually outsource that work. It's better to keep it in-house and use it strategically. And so in the end, I think the brand of Verizon is going to be stronger for the contract it's negotiated.
MARY CATT: OK. Some of our questions have come in. Please keep them coming. And I'll start with one from Susan. Why did Verizon Wireless finally accept union organization at this time after many years of resistance, especially in light of outsourcing and offshoring in general?
ROSEMARY BATT: Well, I'm not sure I can answer that question completely. But I think it was just the dogged persistence of the union. And the union has-- represents wireless workers in many other companies, and particularly in AT&T wireless, where represents some 50,000 workers.
And over time, the union has worked very persistently to organize, to build the confidence and the trust of the workers, and finally it paid off. So I don't think there was anything magical about now except that they had persisted in this effort for so long. And possibly going back to the environment in which workers are seeing the Fight for $15, the fast food workers standing up. And they saying, finally, well, it's our turn.
MARY CATT: Mm-hmm. Mm-hmm. Somewhat related to the first question is this one. The frequency of strikes at Verizon over the years would suggest some innovative strategies might be in order. What are management's initiatives in that regard?
ROSEMARY BATT: Well, so I don't have an-- unfortunately I don't have an inside avenue to-- I haven't talked to any of the managers at Verizon. So I don't know what their thinking is.
The union and management have actually had an uneven history. So there were-- in the '80s, there were some really, really bitter strikes. And then there was a kind of coming together and an attempt to do labor management cooperation. And then that kind of broke down.
And then there's been a history of kind of antagonism. But that is also true of other unions, where there's almost a pendulum between an antagonistic relationship, and then there's an attempt to create cooperation, labor management cooperation. So I would hope that this strike has taught Verizon that it needs to move back in that direction.
The CWA, in particular, has a very strong history of doing effective labor management cooperation. And for example, the union has never opposed such things as technological innovation. As long as we can retrain and replace workers and find them new jobs, it hasn't been kind of opposed to that kind of innovation. So I think there are real opportunities now to move forward.
MARY CATT: Yeah, great. What do you think the impact will be for public sector employees? Will there be any implications, do you think, that the public sector might learn some lessons from this private sector win-win?
ROSEMARY BATT: Well, first of all, the public sector is very diverse, right? So the public sector unions at the federal level versus at the state level versus at local municipalities, versus teachers, for example, versus firefighters, they all have very different contracts and different state laws and federal laws to abide by. And so it is a quite diverse constituency.
I don't know that there is anything different that the public sector workers would learn compared to, say, other private sector unions. I do think that the strategies have to be a bit different because the public sector workers are facing the, as in Wisconsin, having their rights to collective bargaining taken away.
And so the way to solve that, of course, is to build public support to change the law. And so they've got to really engage in a political strategy to make sure their collective bargaining rights are secure. And that has to be, I think, first and foremost on their agenda.
MARY CATT: Mm-hmm, OK. We're getting some excellent questions in here. Keep them coming. Thank you. Do you think that what happened with Verizon will trigger a resurgence in organizing activity in the private sector?
ROSEMARY BATT: I hope so. I think that there are-- there are many unions that have been really trying to organize. And that one of the great difficulties is the way that our labor laws are enforced in this country.
And that is that even if you win a union election, it can take a very, very long time before you get a first contract. And an employer has lots of ways of delaying that. And then even if that contract-- if they get stalled, the employer can try to challenge the election at the NLRB or in courts so that that in itself has created a real chilling effect on union organizing.
So I think that the strike will give unions inspiration to be aggressive and mobilize on all fronts. And that will include organizing and also representing their own workers effectively.
MARY CATT: OK. This question asks, do you see the union's success here translating to other ongoing negotiations, such as those between CWA and OFS?
ROSEMARY BATT: Well, I hope so. I actually don't have detailed information on those negotiations, so I'm hesitant to say much about it. What I do think is that the CWA has, over the years, become very sophisticated in its organizing and its mobilizing. Essentially, the CWA treats its membership organizing as if it's an external organizing campaign.
And they have built the capacity to mobilize their members to really get out there in the public and explain their issues to the public. And just as they've done that in this fight, I think they will transfer those strategies to the other campaign as well.
MARY CATT: So that tactic contributed to the union's success here.
ROSEMARY BATT: Absolutely.
MARY CATT: OK.
ROSEMARY BATT: The CWA and the IBEW working together are very effective at really educating their members and treating them with dignity and respect and saying, this is your union. And you need to be there mobilizing and organizing for your rights.
MARY CATT: On the other side, there didn't appear to be a highly visible corporate campaign. So what's that all about?
ROSEMARY BATT: I'm not-- do you mean a corporate campaign-- a campaign by the corporation? Or do you mean--
MARY CATT: Yes.
ROSEMARY BATT: That's surprising. I don't have a good answer for that. Although, I'm not sure what the message would have been. I mean, it's hard-- imagine a corporation saying-- going on into the public media and saying, well, we think we have the right to undertake layoffs and send jobs to Mexico. I mean, that's not a very good message for the brand.
So I'm not sure what the corporate campaign would have consisted of, except I guess that workers are paid too much and they should-- they shouldn't be paid as much. But those weren't the real issues. The issues were around job security. And most working people, I think, really support efforts to provide job security to people in this country.
MARY CATT: OK. Paula writes, for those unions that cannot go on strike, what do you suggest in terms of pushing back on the threat of outsourcing IT positions?
ROSEMARY BATT: Ah, that's a great question. So I think if we look at the CWA campaign, we see that a lot of its effectiveness-- and not only the CWA, but other campaigns in recent years, have been in going to the public and making this-- take the Fight for $15 or the fast food workers, they don't have the right to strike with union protection, right? They have the right to assemble and have collective action.
But by having a visible campaign and taking it to the media and to the public and saying, these are really legitimate issues. And outsourcing and offshoring doesn't hurt just us, it hurts all Americans. It hurts the American economy. I think that that message is a very powerful one.
And increasingly, the way that workers are gaining-- or making gains are through these kind of public campaigns and public mobilizing, social movement kind of activism that has meant, for example, the success in passing the minimum wage laws.
MARY CATT: OK. Stephen asks, what are the main benefits Verizon derived from its prolonged negotiation? I think you mentioned a couple of them earlier.
ROSEMARY BATT: I'm not sure I understand the question. Why did it hold out as long as it did? Again, this is from the outside because I haven't had any personal exchanges with people in the company.
But from other conflicts that I've seen, it seems to me that the company underestimated the ability of the union to stay out on strike. So OK, we can handle a strike for a week or two. So we're going to keep on holding out, and maybe another week.
And then I think it got quite shocking. And that is where, I think, having the Department of Labor Secretary Tom Perez step in and try to bring the parties together was very important. It sent a really important signal to both parties. And I think that must have been important in changing the tone of the company.
MARY CATT: Were you personally surprised that Tom Perez stepped in?
ROSEMARY BATT: Yes. I think that because of who he is, we would say it would be the right thing that he would do, and we would expect it. But it's surprising because no Secretary of Labor has stepped into a labor dispute for decades. I mean, I can't really remember the last time that a Secretary of Labor said, let us get involved and try to bring this to a solution. So that I think is a surprising fact.
MARY CATT: OK. One viewer writes in, I saw the Verizon workers picketing and I gave them a friendly honk. What other actions did the union do to engage and educate the public?
ROSEMARY BATT: I think that what they were doing in getting out in public-- I'm not sure that many other things they did to get the public involved, except that there was a lot of media efforts to educate the public about why the strike was going on-- so through the media.
But then getting the workers out on the streets I think is a very effective way. So I'm not sure I know any more-- I don't know whether there were things that the union was doing behind the scenes. But I think this getting-- I mean it's remarkable for workers to take off work and to go out in the streets and try to meet other people in public. And that's what they did. So I'm not sure I can add much to that question, but I think this public exposure of workers to other working people is very effective.
MARY CATT: Do you think the strike-- and what will probably be the upcoming approval of the contracts-- we would expect they'd be approved. Do you think it will be good for morale on the Verizon side for the workers? Do you think it's going to be a big boost?
ROSEMARY BATT: Oh, absolutely.
MARY CATT: OK.
ROSEMARY BATT: Absolutely. Because, look at, their jobs are secure. I mean, the difference between going to work knowing you have a secure job and that you then can turn your efforts to really providing good service and good performance, that's really important, as opposed to come into work wondering if you're going to have a job the next day.
Well, then, you lose focus, right? So I think that providing that kind of security and that win is going to be a real morale boost and that workers will respond very positively.
MARY CATT: OK. Another viewer asked, can you provide please some citations for the National Labor Relations Board decisions that make it more difficult for employers to replace strikers. I was a little confused by the PATCO example since it involved the FLRA, and not the NLRB.
ROSEMARY BATT: OK. So first of all, I'm not a labor lawyer. But the PATCO use-- the PATCO case is symbolic because Reagan essentially replaced all the PATCO workers with replacement workers that-- and when the workers were on strike.
And there is a different law, it's a federal law, but it sent a signal to the private sector that you can do this, too. And so from that point of view-- then the kind of rule became one of employers can use strikebreakers as they will. And they don't have to say why.
Historically, the original NLRB law on this point said that the employer had to provide a reason why the replacement was not illegal. In other words, why the replacement would be considered legal. And so the burden was on the employer.
With this new NLRB ruling, the onus shifts back to the employer to make that justification. And I can dig up some citations, but I think the best thing is to go to the NLRB website and look at the decision and see what those citations are.
MARY CATT: OK. Great. Two last questions and we'll wrap it up. But are you seeing any evidence of the offshoring pendulum starting to swing back? That is in particular, offshored IT jobs being brought back onshore?
ROSEMARY BATT: I don't, really. So first of all, our data on outsourcing and offshoring is miserable. Unfortunately, the government does not collect statistics in a way that we can even understand which IT jobs are in-house versus which have been outsourced to a vendor or a third party, let alone which ones are offshore.
So the numbers are very murky. Occasionally, we see anecdotes that say, oh, companies have decided to bring these jobs back because of better customer service, or et cetera. But I think those stories are pretty anecdotal and are very small scale. So I don't think we have the evidence to suggest that jobs are coming back, unfortunately.
MARY CATT: Mm-hmm. Joe just wrote in and made note of the role that workers' centers played in this strike. And he says Tompkins County Workers' Center mobilized members of the strike to take part on a daily basis. So that's an interesting--
ROSEMARY BATT: That's absolutely right. And I'm sorry I didn't mention that because the workers' centers have been really a major source of innovation and activism and mobilizing. And increasingly, unions and workers' centers are working together.
So for example, in the recent SEIU National Convention, there were discussions about how members of workers' centers might become-- or the fast food-- not the fast food-- the workers' centers could become members of SEIU over time. And I think there are a number of really creative ways that the unions and workers' centers are working together. And this is a great example. So thank you for mentioning that.
MARY CATT: Mm-hmm. To what extent do you think that the current political movement-- and they cite Bernie Sanders here in this email-- has to do with the unions' success and public support for workers?
ROSEMARY BATT: Well, certainly, Bernie was out really early on on the picket line and in the rallies with CWA workers. And that was really important and terrific. It's hard to separate out who's doing what. But I think the Sanders campaign is an example of this bubbling up. And so there are-- he's playing a critical role as a leader in really energizing young people who want a better vision and who want more power and ability to change their lives.
And he is feeding into other movements that have already been around. I mean, the Occupy Wall Street movement from a few years ago. And the workers' centers, and the Fight for $15, and Black Lives Matter. And so we have, I think, pockets of mobilization that have been going on for many years.
And the mainstream media does not cover this. You have to look on alternate alt news or alt labor news to find a lot of these struggles. And I think what's happening now is they're coming together. And we're seeing the Sanders campaign both benefit from what has been happening locally, and then building that and taking it to a new level.
MARY CATT: Mm-hmm. Well, thank you so much, Professor Batt. This has been great. Your insight is so welcome. And thank you to our viewers. We really appreciate your participation. Momentarily, you'll be able to find this discussion online at the same place where you checked in to view today's ILR Online webcast. Again, thank you very much.
ROSEMARY BATT: Thank you.
SPEAKER: School at Cornell University.
[MUSIC PLAYING]
Cornell University ILR School professor Rosemary Batt will discuss labor-management implications of Verizon's tentative agreements with nearly 40,000 union workers. Expected to vote on proposed contracts this month, workers appear to have successfully opposed job outsourcing. Is the successful pushback a one-off fix or a boost for unions in general? What can we learn from the conflict?
Batt, whose research includes the telecommunications industry and service management strategies, is the Alice Hanson Cook Professor of Women and Work at the ILR School. A professor in ILR's departments of Human Resource Studies and International and Comparative Labor, she coordinated the Global Call Center Project. Batt has written extensively on human resource practices and their effect on firm performance, the quality of jobs, and wage and employment outcomes.
