Update Sunday: Negotiations are continuing past the strike deadline. According to various statements by the CWA and AT&T, the two sides remain focused on wages, health care costs, and job security. More detail will be posted as appropriate. Telwares maintains:
SUMMARY OF ISSUE:
•On April 4th 2009, a series of five regional union contracts will expire between AT&T and the Communications Workers of America affecting 112,000 employees. A sixth contract due to expire later this year is also in scope.
•Members of the CWA have ratified a strike if negotiations are unsuccessful.
•AT&T is seeking concessions related to active and retired employee health benefits, essentially sharing more of the burden with employees.
•The CWA is seeking to finalize a variety of wage issues and mitigate the AT&T position on sharing more of the medical costs.
•AT&T has been preparing for several months to accommodate a strike by training non‐bargained employees for assignment throughout the organization.
TELWARES PERSPECTIVE:
While a strike would clearly put a strain on AT&T’s resources, we do not believe this will materially affect continuing operations within AT&T in the short term. The Telwares concern for existing clients and prospects grows larger if a strike were to happen and extend for more than a few weeks. At that point, we believe there could be real jeopardy for clients relating to account support, service provisioning/troubleshooting, and network implementations/migrations.
KEY ENTERPRISE CONSIDERATIONS:
•Contractual risk mitigation ‐ how are labor disputes handled in your contract(s) and is there remedy available to you if needed? The majority of AT&T agreements to address labor disputes as part of Force Majeure language – due diligence is required.
•Account maintenance and support ‐ if resources are stretched within AT&T, what is the contingency plan specific to your relationship with them, in practical terms?
•SLA delivery ‐ what provisions are wrapped around the SLA’s in your contracts, and again, are there sufficient remedies in place if service were to degrade?
•Implementation and/or migration of new services ‐ if new services are planned or in‐flight, what is the contingency plan to accomplish the transaction? What remedy is available to your organization?
oIn addition, there may be implied delays in contract negotiations or legal review/approval process due to any labor dispute. This should be challenged aggressively.
