Employees of AT&T Inc.’s (T Quick QuoteT - Free Report) internet service, represented by the Communications Workers of America (CWA), has approved a strike if a new contract is not reached soon. The last contract expired in Jul 2016 and has been extended till today. However, the employees are now negotiating for a better contract including a reasonable increase in wages and benefits. The strike covers 2000 internet workers employed across all of the company's centers, who provide customer as well as technical support related to IP-based services such as IPTV and DSL.

Ongoing Negotiations

AT&T has been tied up with negotiations over new contracts covering over 16,000 employees in three of its operating states. The union has been condemning the telecom giant of taking a hard-line stance related to key bargaining issues. However, to its credit, AT&T has been able to resolve the issue of unfair labor practice recently. Further, the company is confident that it can strike a fair deal with the workers union soon.

The Bottom Line

Strike threat from workers is pretty common and usually do not materialize as negotiations are reached effectively before the occurrence of such an event. However, we must take note of the recent strike faced by Verizon Communications Inc. (VZ Quick QuoteVZ - Free Report) from its wireline workforce, which materially dent its operations. In a competitive market, if labor issues halt any operation, telecom operators are likely face issues that can severely hamper their reputation. Other telecom players such as T-Mobile US Inc. (TMUS Quick QuoteTMUS - Free Report) and Sprint Corporation (S Quick QuoteS - Free Report) are also facing or have faced worker issues in the past.

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