May 24, 2018
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Lines drawn: Strike or lockout could be next as FairPoint contract impasse deepens

Brian Feulner | BDN
Brian Feulner | BDN
“FairPoint technician and union mobilizer Jim Feeney (left) marches alongside Bob Toole on Aug. 12 during an informational picket in front of FairPoint Communications in Bangor. Feeney said Friday that FairPoint workers in Bangor were on “heightened alert” in case a strike is called after the company stepped away from bargaining early Thursday morning.
By Darren Fishell, BDN Staff

PORTLAND, Maine — Union negotiators with the ability to call a strike of about 2,000 New England employees of FairPoint Communications are mulling their next step after being forced to work under contract conditions they don’t like.

Members of two unions that represent FairPoint employees began working under the terms of the company’s last offer Thursday morning, after management declared an impasse in negotiations that allowed them to impose the most recent offer on workers.

“We’ve not decided what’s going to happen,” said Peter McLaughlin, a lead negotiator for the International Brotherhood of Electrical Workers Local 2327. “The options are to work under the imposed agreement, we could be locked out or we could strike — those are the big three options.”

McLaughlin said lead negotiators for the International Brotherhood of Electrical Workers and Communications Workers of America in Maine, New Hampshire and Vermont do not have a deadline for making a decision. Members of the union authorized declaration of a strike before the contract covering about 800 Maine workers expired Aug. 2.

“Nobody takes a strike lightly, but it’s not like we’re hesitant,” McLaughlin said. “We’ve been working at this for some time, and we’re not all new to this process, and we know what we need to do.”

Company spokeswoman Angelynne Amores Beaudry said previously that the company has a plan in place in the event of a strike.

Jim Feeney, an outside technician and union mobilizer based in Bangor, said Friday afternoon that the company’s union workers were on “heightened alert” because a call of a strike could come at any moment.

“And that’s not a comfortable feeling,” Feeney said.

In Portland and other locations around the state, the company has painted orange lines marking the edge of its property, as a precaution in the event of a strike.

“It’s our preparation because they have been very vocal and public about the actions that they want to take,” Beaudry said.

The latest round of negotiations has been tense, with both sides firing accusations of intransigence at each other. Feeney said the tenor of those talks is something he’s not experienced in his 31 years on the job.

“We don’t feel like we’re part of the company,” Feeney said. “They make us feel very much like an expense.”

The union has filed a complaint with the National Labor Relations Board that its negotiators continued to propose concessions, including millions in its latest contract offer presented to the company on Wednesday morning. That complaint could factor into the short-term decision of the union if the National Labor Relations Board steps in, but McLaughlin said any action could take months.

In the meantime, union negotiators are left considering terms of the company’s most recent offer. That includes the ability for the company to outsource work to contractors, cut retiree medical coverage for employees and freeze its defined pension benefit plan.

FairPoint’s ability to bring in subcontractors has been a central point of contention for both sides throughout the talks. Union officials said that could compromise jobs and service quality while the company said it would allow FairPoint to be more flexible in adopting, installing and maintaining new technologies. Beaudry said the last offer from the company would prevent it from bringing in any subcontractors that would trigger any layoff of a union employee.

The company said the rest of the benefit package would be largely the same as that offered to company management.

The possibility of a strike could have implications for service across the company’s network, which is the backbone for much of the state’s telecommunications infrastructure, from Internet to cellphone services, emergency networks and maintenance of the telephone poles that other companies use in much of northern New England.

The publicly traded North Carolina-based company acknowledged that a strike could affect its business in its second quarter earnings report, which logged a $22.7 million loss and “continued pressures on legacy revenue.”

The company has struggled since its acquisition of Verizon’s landline network in 2008, a move that eventually sent the company into Chapter 11 bankruptcy.

Feeney said Friday that some of the challenges from that acquisition still exist today, which he attributed to the company’s decision to build its own back-office operations to manage the lines it acquired from Verizon.

“They’ve got to fix the back office before the front office can make money,” Feeney said.

The company has grappled with regulatory changes since Maine deregulated the telephone industry and after FairPoint was designated as a mandatory service provider, or provider of last resort, for much of the state. The company is fighting requirements that it report service quality metrics along POLR lines, saying the requirement places it with an unfair burden that competitors don’t have.

After reorganizing under Chapter 11 of the U.S. Bankruptcy Code, the company was purchased by a group of 191 shareholders. Four of the five largest shareholders are hedge funds, according to testimony to the Legislature’s Energy, Utilities and Technology Committee in February from consultant Randy Barber.

Union officials speculated earlier this year that the company is gearing up to be sold.

McLaughlin reiterated that speculation earlier in August.

“They’re looking to affect the balance side of the ledger. … It’s not about cash flow,” he said. “What it looks like is that they are gussying up the company for a sale.”

The company’s stock price on Friday remained close to its 52-week high of $16.91. FairPoint shares were at $16.02 in afternoon trading.


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