Verizon unions set Sunday deadline for labor talks

NEW YORK (Reuters) - Verizon Communications Inc's VZ.N two major unions set a new Sunday midnight deadline to complete negotiations over a labor contract for 65,000 workers, saying they may strike if a deal is not reached by then.

The sign for the Verizon Wireless store is seen in Lakewood, Colorado September 11, 2007. REUTERS/Rick Wilking

The workers’ contract had been due to expire on August 3, but the unions agreed last Saturday to extend the deadline after their bargainers reported significant progress in talks with Verizon.

“Since Saturday’s agreement to “stop the clock,” progress at the bargaining table has been uneven, particularly on outsourcing, subcontracting and union recognition issues,” the Communications Workers of America said in a statement.

Other issues in contention include health care costs for current and retired workers, and wage increases to adjust for rapidly rising food and gas prices, said the CWA, which has 50,000 members covered in the previous contract.

The majority of CWA members and the International Brotherhood of Electrical Workers, which has 15,000 workers, have authorized a strike if negotiations fail. Their members are employees in Verizon’s telecom unit.

The unit, which has about 103,000 workers, covers residential and small business telephone, broadband Internet and video services.

Any major walkout would be a blow at a time when Verizon is trying to expand its FiOS high-speed Internet and video service to compete with cable service providers like Time Warner Cable TWC.N and Cablevision CVC.N.

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Bernstein analyst Craig Moffett said Verizon would be under more pressure than ever to avert a strike as its cable rivals have become much stronger in recent years at competing directly against Verizon in areas such as telephone and Web access.

“On the other hand, Verizon has some very real and intractable cost problems it has to address,” Moffett said, adding that this was why it was taking time for the two sides to reach an agreement.

But Verizon representatives said they were surprised by the new deadline, adding that they had resolved most of the important issues being negotiated on with the unions.

“The reality is we’re making good progress. We think that the talks are headed in the right direction in Washington,” said Verizon spokesman Eric Rabe.

When asked if there would be an agreement by the new deadline, Rabe said, “I think that’s entirely possible.”

Thousands of Verizon union workers plan to picket and rally from Virginia to Massachusetts on Friday, the unions said.

The last time Verizon workers went on strike in 2000, some 85,000 workers walked off the job for about three weeks.

Verizon shares were up 87 cents or 2.5 percent at $34.58 on the New York Stock Exchange on Friday.

(Reporting by Ritsuko Ando and Sinead Carew, writing by

Tiffany Wu, editing by Leslie Gevirtz)