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Early Settlement at AT&T: Members Win Substantial Gains in Wages, Pensions, Access to New Job Areas

An early tentative settlement at AT&T includes strong wage, profit sharing and pension gains along with improvements in health care and other benefits and a breakthrough in organizing areas such as AT&T Wireless that currently are non-union.

Upon ratification, the agreement takes effect as of May 9 and will run for four years, making it the longest contract ever with AT&T. Settlement was reached three weeks before expiration of the current contract on May 30. It covers 48,500 CWA members and another 2,000 represented by the IBEW.



Commenting on a base wage package that delivers gains of 16.25 percent compounded over term, plus bonuses and guaranteed profit sharing, CWA President Morton Bahr noted that, "AT&T has shown that it recognizes the value of a skilled and productive workforce and wants to continue to attract the best people."



CWA's chief negotiator, Vice President Jim Irvine, said: "We engaged in hard bargaining - very hard at times - but we did so with mutual respect.... AT&T now understands that they need to compensate our members well in order to keep them, and that our union adds value to the business."



The agreement calls for bonuses totaling $1,000 upon ratification, and base wage increases every six months throughout the contract, with 2 percent at go-down followed by 1.75 percent, 2 percent, 1.75 percent, 2 percent, 1.8 percent, 2 percent, and 1.9 percent.



The effect of the base wage increase takes the average weekly wage from $686 at present up to $797 after three and a half years.



In addition, a $10 million fund was established to address inequities in certain titles including the "L" titles and in wage zones.



A new AT&T Performance Plan, replacing Shares for Growth, gives members the same profit-sharing plan that management now enjoys, but with a guaranteed minimum payment of $400 each year for CWA members, which managers don't get. The plan pays $850 if all performance goals are met and even more if goals are exceeded.



Among significant pension improvements was establishment of a new Cash Balance Account (CBA) that includes a 100 percent cash out option for vested members.



Employees with 15 or more years of service as of July 1, 1998 will have the option of staying in the traditional Annuity Pension Plan (APP), and all others will be moved into the CBA. There is an immediate 4 percent increase in both plans and those



opting to stay with the APP will receive an additional 3 percent. There will be an additional 5 percent increase for those retiring after April 1, 1999 and another 3 percent increase for those retiring after January 1, 2000.



In a major step toward wall-to-wall organizing, the settlement provides for immediate consent elections overseen by an impartial umpire for unorganized units at AT&T Wireless, Solutions and all future acquisitions including Teleport. If the umpire should determine that AT&T management has failed to live up to its neutrality pledge, then future recognition will be based solely on majority cardcheck with no elections required.



The package includes a range of improvements in health care and prescription drug programs, and it increases the cap for retiree health care, so that there is no premium sharing for those who participate in Medicare HMOs, where applicable, or who are under age 65. Next year, health care and some other benefits will also be extended to designated same-gender partners.