Verizon, Frontier, CWA Strike Deal on Acquisition in California
Verizon, Frontier and the Communications Workers of America (CWA) reached a settlement that they said protects workers and customers as Verizon seeks approval to acquire Frontier in a $20 billion all-cash deal. They asked the California Public Utilities Commission (CPUC) to adopt the agreement in a joint motion posted Thursday (docket A-24-10-006).
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The settlement sets hiring commitments, job protections and service quality standards. It also makes the terms legally binding once Verizon takes control. There's "no doubt that consumers will be better off" if the deal is approved with the terms agreed to under the settlement, the joint motion said.
CWA, which represents thousands of Frontier employees in California, raised concerns about layoffs, network maintenance and customer service. The settlement addresses those issues and establishes certain conditions for Verizon once the deal is finalized.
Verizon agreed to launch a plant maintenance program within a year of closing the deal. It will run for three years and allow technicians to submit maintenance reports, the carrier said. The company must complete repairs within 90 days of a report to address concerns about delays and maintain reliable service.
Additionally, Verizon will submit quarterly reports to the CPUC and CWA for four years after closing on compliance with service quality rules. If performance problems persist at the end of that period, Verizon will be required to continue submitting reports. The company will also convene a service quality committee of executives, labor leaders and union representatives that will review issues and explore solutions, including adding staff.
Other oversight measures include an audit by Verizon of Frontier’s California network within one year so it can bring those facilities up to its standards and CPUC rules. Verizon also committed to maintaining backup power. Systems must include at least eight hours of battery capacity with generators that can run 24 hours without refueling.
The deal also protects jobs for CWA members, ensuring that Verizon won't "involuntarily lay off" any CWA-represented employees for four years. Verizon agreed to hire 100 full-time CWA-represented employees annually for six years. The layoff provision applies to current workers and those hired under the agreement.
The settlement addresses carrier-of-last-resort requirements as well. Verizon will assume Frontier’s obligations to provide basic voice service in certain areas. Should the CPUC later release Verizon from those duties, the company must still offer a voice service for 12 months using the technology of its choice. Customers will be able to switch to another provider during that period.
Verizon CFO Anthony Skiadas said at Citi financial conference Thursday that the carrier still expects to close its purchase of Frontier in the first quarter of next year (see 2506120003). “We've secured approval in eight out of the 13 states where we need to get approval, along with the FCC and the DOJ, and we're going to work with the remaining states,” he said. “That's already in progress to ensure we can get the deal closed.”