Unions applaud pending Baby Bell mergers
The pending SBC-Ameritech and Bell Atlantic-GTE mergers have won an unlikely set of champions in the country's labor union leaders.
In a letter sent to the Federal Communications Commission in late February, AFL-CIO President John Sweeney urged that regulators approve the pending mergers between the four local phone giants.
"In contrast to most mergers which result in significant job loss, the proposed Bell Atlantic-GTE and SBC-Ameritech mergers will lead to the growth of good jobs in the telecommunications industry," Sweeney wrote.
"These two mergers are necessary to ensure that these carriers are able to thrive in the new telecommunications marketplace," Sweeney added. "The alternative will be a reduction of employment standards in the telecommunications industry."
Sweeney's letter added weight to earlier union endorsements from the Communications Workers of America and the International Brotherhood of Electrical Workers, the largest labor groups representing the two companies' employees. Both groups are AFL-CIO affiliates.
The support of the unions for the megamergers is somewhat unusual, given labor groups' traditional hostility to corporate consolidation.
But the two local phone mergers differ from most business marriages, the labor groups note. The companies have promised to expand their coverage areas and services, which will create a net growth in jobs, they say.
The companies have made this argument repeatedly at hearings in front of the FCC and state commissions, where policy makers have occasionally asked for more than just promises, but proof. After several weeks of negotiations, SBC and Ameritech last week struck an agreement with Ohio state policymakers and consumer groups to keep jobs in that state at pre-merger levels.
Sweeney cited employees' experience with the SBC-Pacific Telesis and Bell Atlantic-Nynex mergers as partial reason for the unions' support.
"In both cases, there has been a significant job creation since the merger closed," he said.
Union workers in California said credit for the new jobs shouldn't be given fully to SBC, however.
"We have seen an increase in the number of jobs, and in the number of positions," said Louie Rocha, president of a Silicon Valley-based chapter of the CWA. But he said this was more the result of Pacific Telesis's previous downsizing, and a boom in the state's economy after the merger closed, than to SBC's pro-union policies.
"We were caught shorthanded," Rocha said. "They had no choice but to hire."
Both SBC and Bell Atlantic have much better relationships with the unions than do national companies like MCI WorldCom and Sprint, Sweeney said.
The mergers are still being reviewed by state and federal regulators. Regulatory staff in Virginia today released a proposed set of conditions for the Bell Atlantic-GTE merger, while the Ohio Public Utilities commission is slated to vote on their staffers' negotiated agreement soon.
The FCC has said it would likely rule on the mergers before mid-year.