Nearly 40,000 Verizon workers are heading back to work tomorrow after a six-and-half-week strike.
Last week Verizon reached a tentative agreement with the Communications Workers of America and International Brotherhood of Electrical Workers to end a strike that began April 13th. The new contract still needs to be voted on by union members, but workers agreed to return to work. Once the contract is ratified, Verizon plans to hire another 1,400 union workers.
It’s easy to think of the Internet as consisting mostly of fiber optic pipes buried deep underground and anonymous data centers full of computer servers and networking gear. But despite advances in automation and artificial intelligence, all of this infrastructure takes real human workers to build and maintain. As Verizon has learned, those workers are still hard to replace.
Verizon said during the strike it had mobilized contractors and non-union employees to fill in for the striking workers. In practice, The Wall Street Journal reported, that meant sending managers, programmers, and lawyers into the field to run fiber optic cables through walls and climb utility poles.
The company also advertised temp jobs. Over time, Verizon could have trained enough people to fill in for striking workers. But in the short term, the strike led to a significant decrease in new sign-ups for its fiber optic service this quarter as wait times for installations soared, CEO Lowell McAdam and CFO Fran Shammo acknowledged earlier this month. Analysts cut revenue forecasts for the company, and stocks dipped.
The Internet Is People
In the face of that downward trend, Verizon conceded so much more than the unions in the final negotiations. Yes, the company will save hundreds of millions in health care costs thanks to concessions by the unions, according to The New York Times. Verizon will also gain the option to offer buy-outs to employees without the unions’ permission.
In exchange, Verizon has agreed not to outsource support calls to non-union call centers, keep pensions intact, and give workers a 10.5 percent raise over four years. The new contract will also apply to 65 Verizon retail stores, marking the first time Verizon Wireless employees—as opposed to those working for the company’s wireline services—are covered by union contacts.
That last point is especially important. Verizon has been selling off its wireline services to companies like Frontier while it focuses more on its wireless business. By extending contracts to Verizon Wireless staff, the unions are increasing their relevance to the company’s future, surely to the chagrin of Verizon executives. But for now, the company just can’t do without them. The Internet, it turns out, still can’t run itself. Staying connected still requires people.
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