The Proposed settlement between American Telephone & Telegraph Co. and its unions provides that workers who are laid off because their jobs have been made obsolete by modern technology will receive an extra $400 a month for 48 months if they are near retirement and have been with AT&T for more than 20 years. This provision was misstated in an article yesterday.
The tentative settlement between American Telephone & Telegraph Co. and its unions is being hailed by labor and management officials alike as a significant landmark for future labor contracts in which job security is a major issue.
The proposed settlement, which is expected to be in final form by midnight tonight, contains elaborate retraining and retirement provisions to help both the company and its workers cope with AT&T's transition to a more competitive company that relies more on electronics and less on workers to do its job.
Job security and retraining provisions are "the most important part of the package--as important, if not more important, than wages," said Arthur Perry, director of the telephone department for the International Brotherhood of Electrical Workers, which represents 100,000 of AT&T's 675,000 union employes. The Communications Workers of America represents 525,000 workers, while the Telecommunications International union represents 50,000 AT&T employes.
The telephone contract follows others in the automobile and other major industries that have given greater weight to security and training. According to Perry, "there is not another contract within this office that comes as close" in retraining and job security benefits. "We hope to use this as a pattern" in future contracts, he said.
The contract represents "a milestone in union thinking," said Paul Strassmann, vice president of Xerox Systems Group and an expert in job retraining. Management has long viewed retraining as an important business tool to increase performance and morale, Strassmann said. "But what makes this agreement really significant is that the union is now seeing education as big an issue as wages and benefits."
Other labor force experts believe that the contract will be more than just a landmark in union thinking. "It is obviously quite progressive . . . on the cutting edge of where the whole country is going," said Pat Choate, a industrial labor analyst with TRW Inc. "I'd be surprised if it doesn't become a part of other contracts--and even more surprised if it doesn't find itself endorsed in national legislation" now being considered in Congress to help the millions of unemployed Americans who can't get jobs because they lack the training to work with modern technology.
Specifically, the contract provides:
* A $36 million training and retraining program--all funded by the company--to provide new skills to workers whose jobs are being phased out or downgraded, as well as to employes who want to enhance their career development. Unlike AT&T's current training programs, these will not be geared for any specific job but instead will be general in nature to give employes more skills through which they can move on to other positions. What's more, all employes with more than one year experience will be eligible for the courses, not just the ones chosen by management, as is now the case.
However, employes will have to take these courses after work hours--a move management experts hail, believing it will generate a more sincere interest among employes while keeping company costs low. By far the biggest expense in training courses is paying an employe's salary for the time he or she takes the course, these experts say.
* Termination pay for workers forced to leave AT&T because their jobs have been made obsolete by modern technology. Workers who have been with the company for 20 years and are near retirement would receive an extra $400 a week for 48 weeks plus a lump sum of $3,000--in addition to the pension benefits for which he or she would be eligible. Workers not near retirement or with less time at the company would also get severance and be eligible for payment of expenses involved in relocating and training or job placement services, up to maximum of $2,500.
* A guarantee that workers forced to take lower-level jobs because their former positions have been made obsolete by technology would not be forced to take a pay cut for three years. And then, their cuts would be phased in.
* A guarantee that workers demoted because their jobs have been made obsolete because of the upcoming breakup of the Bell System or because of recent federal policies encouraging competition in the telecommunications industry would not receive any salary reduction over the three-year contract life.
Like many companies moving to keep up with modern technology, AT&T is faced with turning its blue-collar work force into a white-collar one as less and less manual labor is required to install and maintain the modern technology, largely made up of microprocessors and electronics.
The pressure to modernize is all the more great with AT&T, however, given the increased competition in the telecommunications industry and the pending divestiture of the Bell System, scheduled for Jan. 1, 1984.
And that makes the unions worried. IBEW's Perry notes that in one local unit in New Jersey, 1,700 Bell System installers were notified that they would no longer be needed, as the telephone systems become easier to install and as more and more consumers install telephones themselves.
Just how many jobs--if any--will be lost under this pressure is hard to tell, says CWA's Ronnie Straw, who is director of research and development.
"On the one hand, we see computer technology and microprocessing equipment taking over and tending to reduce the work force. But on the other hand, we see more competition creating more news and more profits for the company which means more jobs. We're just not certain which way the trend is going to go."
But the fear that the trend would go down made job security the most important issue for all unions, Straw said.