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Lucent Contract Talks Yield No Agreement November 18, 2002 Four years ago, the IBEW bargained with the new economy telecommunications manufacturing giant and emerged with 18 percent wage increases, bonuses, and performance incentives. This year in early negotiations before the contract expires May 31, 2003, the struggling former telecom wonder refused to even discuss the possibility of providing workers protection in the event of a company bankruptcy. The October session at the request of the company sought concessions from the IBEW and the CWA during joint national negotiations called to save $100 million in health care costs. Four weeks of bargaining produced no agreement, said Troy Johnson, Manufacturing Department International Representative. With 400 IBEW members, Lucent today employs far fewer union workers than the contract manufacturers it spun off in a massive restructuring in 2001. (Agere Systems has approximately 2,500 IBEW members, Avaya Communications has around 1,500 and Celestica has between 1,500 and 2,000.) In recent weeks, Lucents stock price fell so low that it was in danger of removal from the New York Stock Exchange. And during the October bargaining sessions in Murray Hill, New Jersey, the news surfaced that the SEC was reopening an investigation of Lucents accounting practices. Lucents fate is tied to those new economy companies who also rode the high-tech wave and are now struggling to survive. Those telephone and wireless companies must make capital investments before Lucent is likely to recover. Analysts say there is no indication they are likely to do so in the near term. "Their work is reflective of the industry," Johnson said. "Until the industry turns around, I dont see anything encouraging." In October talks, Lucent had asked the IBEW to help reduce its burden over two years for health benefits for current employees and retirees, Johnson said. "They told us if they didnt do something by 2005, health care costs could bankrupt them," he said. Lucent has one active employee for every 15 retirees. Add pension obligations to ballooning prescription drugs and medical costs and the company has significant problems, especially if the business climate does not improve. Other issues snagging the talks include management performing collective bargaining unit work and the companys proposal to drastically decrease funding in employee training programs. Along with card check neutrality for any new acquisitions, the IBEW is hoping to win better benefits for retirees, including vision and dental coverage. The company has proposed a six percent wage increase over two years. Disheartening for union negotiators was the newsalso made public during bargainingthat managers would receive an immediate 2.8 percent bonus. "When youre asking your workers to sacrifice, it makes it hard to swallow," Johnson said. While informal talks are ongoing, Lucent and IBEW will likely return to the negotiation table in April 2003.
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