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Obama Administration Gets Verizon and Strikers Talking Again

May 18, 2016, 11:32 AM UTC
Verizon Employees On Strike
BOSTON, MA - APRIL 21: Striking Verizon employees staged a rally in Copley Square, followed by a march to a Verizon Destination Store on Boylston Street, where union officials spoke to the crowd from the back of a pickup truck. Traffic was diverted for a couple of blocks to vehicular traffic at rush hour due to the event. Steven Tolman, the president of the Massachusetts AFL-CIO is pictured addressing the crowd in front of the store. (Photo by Jim Davis/The Boston Globe via Getty Images)
Photograph by Jim Davis — Boston Globe via Getty Images

Verizon Communications and the two unions representing about 40,000 workers on strike for the past month have reopened talks, this time with a federal mediator involved.

The new talks, prompted by Secretary of Labor Thomas Perez, could head off what was becoming an increasingly bitter and acrimonious strike, the largest labor action in five years. Sporadic talks in recent week made no progress.

President Barack Obama’s labor secretary initially jumped into the fray and brought the parties together over the weekend, a few days after armed security guards from Verizon had chased down strikers visiting call center workers in the Philippines. The incident followed Verizon accusations that striking workers were vandalizing company lines and harassing replacement workers.



To cool off the situation, Perez gathered Verizon (VZ) CEO Lowell McAdam, Chris Shelton, president of the Communications Workers of America, and Lonnie Stephenson, president of the International Brotherhood of Electrical Workers, at his office Sunday and got them to agree to the new round of talks. Alison Beck, a labor lawyer who heads the Federal Mediation and Conciliation Service, is overseeing the talks.

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Both sides agreed not to comment while the new talks are ongoing, Perez said in a statement.

“I’m encouraged by the parties’ continued commitment to remain at the bargaining table and work toward a resolution,” Perez said. “We will continue to facilitate conversations to help the unions and the company reach an agreement.”

A longtime labor lawyer, Beck was named the director of the mediation service in 2014 and confirmed by the Senate last year, the first women to hold the post since the agency was created in 1947. There have been no major strikes since she took the post, although in 2014 she helped avert a walkout at the New York Metropolitan Opera.

The striking Verizon employees, who generally work from Massachusetts to Virginia installing and servicing Verizon’s wire line telephone and FiOS Internet and television service, had been without a contract for nearly 10 months when they walked out on April 13. They say they cannot accept Verizon proposals that would allow additional outsourcing of call center workers to the Philippines and Mexico, greater use of nonunion contractors, and the assignment of employees to other cities for up to two months at a time.

For more on the Philippines confrontation, watch: [fortune-brightcove videoid=4892592027001]

Verizon says it offered a 7.5% wage hike for the new contract over the next few years but also needs new work rules to gain greater flexibility and lower costs as its telephone business shrinks and its wireless business becomes ever more important.