Broken Connections: An Alternative Annual Report for Verizon

8/2/2019 Broken Connections: An Alternative Annual Report for Verizon

1/14

BROKENCONNECTIONS:an Alternative

Annual Reportor Verizon

www.verigreedy.com


2/14

CWA, ounded in 1938, the largest telecommunications union in the world, represents

over 700,000 men and women in both private and public sectors. CWA members work

in telecommunications, broadcasting, cable TV, journalism, publishing, manuacturing,

airlines, customer service, government service, health care, education and other felds.

CWA is one o Americas astest growing unions and a number o unions have afliated

with CWA because o its reputation or democracy and membership involvement.

The union includes some 1,200 chartered local unions across the United States, Canada

and Puerto Rico. Members live in approximately 10,000 communities, making CWA

one o the most geographically diverse unions. CWA is afliated with the AFL-CIO,

the Canadian Labour Congress, the worldwide UNI Global Union, the International

Federation o Journalists (IFJ), the International Transport Workers Federation (ITWF),

and the International Metalworkers Federation (IMF).

To contact CWAs communications ofce, call 202-434-1100.


3/14

02Exorbitant ExecutiveCompensation; Massive Profts

04Attack on theMiddle Class

05Outsourcing andOshoring

06TaxDodging

08Verizon-CableMonopoly

09 Promoting theDigital Divide

10 OpposingConsumer Rights

CONTENTS


4/14

EXORBITANT

EXECUTIVE COMPENSATION;MASSIVE PROFITSVerizon and its executives rake in money while

workers endure cuts.

The top fve Verizon executive made almost $350 million

over fve years while proposing deep cuts or rontline

workers. Leadership or America means creating aneconomy that works or all o usnot just the top 1%.

Proftable companies that cut wages and jobs or the

99% dont create sustainable communities. America needs

broadly shared prosperity and a strong middle class.

Our children and grandchildren deserve better than a

growing divide between the super-rich and everyone else.

Verizons top fve executives took in$349,226,194 in just fve years

Annual Cumulative

2007 $82,258,818 $82,258,818

2008 $63,094,456 $145,353,274

2009 $82,612,322 $227,965,596

2010 $55,571,937 $283,537,533

2011 $65,688,661 $349,226,194

A few people want all the money, when thousands of us support familiesEveryone can see

how much the company wants to take from useven though theyre making more, they want

to give us less. Matt Rivera, 14 years with Verizon

1Chevrolet.com; 2 U.S. Census Department; 3 US News and World Report

2

Here are some

things $349.2 million

could buy:

11,035new Chevy Volts1

1,572homesat the median U.S. price2

Four years of college,all expenses paid, for

4,369 students3


5/14

How the dollars have stacked up or the top fve

in the Verizon executive suite:

Verizon Communications Inc. (NYSE:VZ): Key FinancialsIn Millions o the trading currency, except per share items.

For the FiscalPeriod Ending

12 monthsDec-31-2008A




LTMPress Release12 monthsMar-31-2012A

Total Revenue $97,354.0 $107,808.0 $106,565.0 $110,875.0 $112,127.0

Growth Over Prior Year 4.2% 10.7% (1.2%) 4.0% 5.1%

EBITDA $33,101.0 $35,359.0 $35,378.0 $35,330.0 $36,076.0

Margin % 34.0% 32.8% 33.2% 31.9% 32.2%

2007 2008 2009 2010 2011

3

$82,258,818

$145,353,274

$227,965,596

$283,537,533

$349,226,194


6/14

ATTACK ON

THE MIDDLE CLASSWorkers have been battling or a air contract

or almost a year

You said you needed to outsource work in order to save money to operate, and then that wasnt

enough; and now you have tax loopholes where you dont pay your fair share of taxes, and now

thats not enough; and now you have a contract negotiation where you have an opportunity to

demonstrate your willingness to participate in society and support society, support middle

class people and middle class jobs, and thats not enough! Where does it end?

Javier Espionsa,15 years with Verizon

45,000 CWA and IBEW workers were orced into a 15-day

strike in August. Verizons demands included:

Freezing the value of pensions for active workers and

eliminating them entirely or new workers

Slashing disability benets for workers injured on the job

Eliminating all job security language and continuing

outsourcing o work to low-wage, low-beneft, non-union

contractors domestically and overseas

Imposing health care payments up to $6,700 on retired

workers and $6,800 on active workers.

Eliminating paid sick days entirely for new workers

Limiting paid sick days to no more than 5 for all

other workers

Union workers returned to work under the terms o their

contractand the promise o good aith negotiations and a

restructured negotiation process by Verizons management.

Yet Verizons managementdespite billions in profts

still reuses to oer a air new contract, continuing to insist

on deep cuts.

Even though the company makes billions in yearly profts,

Verizon claims wireline profts are too small. But Verizon

Wireless is not rewarding its workers or the divisions

relatively higher profts: Wireless workers who have joined

the union are also fghting or a air contract.

Verizon Wireless has already raised health care costs or its

workers by thousands o dollars, and has slashed beneft

levels even as its costs have dropped dramatically. When non-

union Verizon Wireless workers have tried to orm a union,

the company has intimidated and harassed them, going so ar

as to close call centers to stop the union rom spreading.

4


7/14

OUTSOURCING ANDOFFSHORINGVerizon sends thousands o jobs overseas and

outsources even more to low-wage contractors.Verizon could be leading the way on Americas economic

recovery. Instead, theyre contracting out and sending

overseas customer sales and service, billing and many other

types o jobs.

For DSL tech support alone, 2,600 jobs are done in Mexico,

India, Canada, and the Philippines. And in addition to

sending several thousand jobs overseas, Verizon has started

using contractors to do more and more work. More Fiber

Solutions Center jobs are contracted out than done in-house.

American companies want American

prots but they dont want to pay American

wagesand that should be stopped.

James Burgund,15 years with Verizon

Other jobs that are no longer done by Verizon employees

but are instead outsourced to lower-wage contractors rom

outside or inside the U.S. include:

VZ Business Monitoring

eService email, chat and ofine

Dispatch

Digging work for copper plant and FiOS

In-home installation and networking

Door-to-door sales of FiOS

Materials distribution work/delivery

Smart Home technology installation/customer

service and other specialized home services

This can come with a price higher than job losses.

Recently, contractors in Rockland County, New York,

dug into a gas line and caused a large explosion

destroying several homes, injuring our people and

landing two volunteer frefghters in the hospital.

5


8/14

While Verizon has been making billions o dollars, awarding

outrageous pay to top executives, trying to cut workers

benefts and outsourcing and oshoring jobs, theyve also

been getting government benefts.

Verizon exploited loopholes to pay nothing in ederal

corporate income taxes between 2008 and 2010, but worse:

theyve actually gotten tax rebates o nearly $1 billion rom

the U.S. Treasury.

Verizons 2010 effective federal income tax rate:

NEGATIVE 5.9%1

Verizons 2009 effective federal income tax rate:

NEGATIVE 5.0%2

1Citizens or Tax Justice; 2, 3 Ibid

TAX DODGINGVerizon doesnt just pay low taxes. In some cases,it pays negative taxes.

And thats not all: Citizens or Tax Justice has documented

thatVerizon Communications has received $180 million

in special tax breaks and grants rom 13 states, and they

regularly seek deep property tax discounts.

Who pays? The rest o us do. Critical services go underunded,

the public debt load goes up, and individuals pay more.

Perhaps worse, these massive subsidies didnt lead to higheremployment, better wages or workers or higher investment,

as companies so oten promise they will. Instead, Verizon

shed 40,600 jobs the past three years, is demanding more

than $1 billion in wage and beneft concessions rom workers,

and decreased capital expenditures by $1 billion.

6


9/14

When Verizon, as a company that I work for, is given a billion dollar tax break from the government,

then they tell me they dont have money to pay my medical, I have a problem with that.

Anita Long, 32 years with Verizon

$180.8 Million Special Tax Breaks

and Grants rom States3

Federal Taxes2008-2009

7

At the ederal level, Verizon should have paid about

$11.4 billion at the statutory rate o 35 percent during

the three-year period. Instead, it got $951 million in

rebates, putting its ederal tax subsidies at $12.3 billion.

Its eective ederal tax rate was -2.9 percent.

Statutory Federal Tax Rate

Verizons Actual Tax Rate

35.0%

-2.9%

AL.$17.3M

AK.$1M

TX.$0.3M

UT.

$0.75 M

MD.$1.7M

NJ.$113M

NM.$12.8M

NC.$8.5M

SC.$6.5M

TN. $6M

OH.$6.5M

PA.$3.4M

NE.$3M


10/14

1Verizon 1Q2012 Earnings Release

VERIZON-CABLE MONOPOLYBlocking competition and choice is bad orconsumers and workersThe 1996 Telecommunications Act promised consumers

competition between telephone and cable companies in

exchange or deregulation. But in December 2011, Verizon

Wireless, a subsidiary o Verizon Communications, inked an

alliance with the nations largest cable companiesComcast,

Time Warner, Cox, and Bright House Networksto sell each

others product and services. The Verizon Wireless/Big Cable

alliance will lead to reduced investment in inrastructure,job losses, ewer choices, and higher prices or consumers.

The Verizon Wireless/Big Cable partnership will end historic

competition between ormerly energetic rivals. The result

will be market domination by an unregulated telecom

behemoth with the ability to raise prices and reduce service,

unconstrained by competitive pressures.

Until now, Verizon Communications has systematically

built out its all-fber FiOS network, competing directly with

cables broadband and video services. FiOS is a fnancial

powerhouse or Verizon, representing 63 percent o

consumer revenues, with an annual growth rate o

18 percent. More than 5 million customer subscribe to

FiOS Internet (36 percent penetration) and 4.4 million

purchase FiOS TV (32 percent penetration).1

But with commercial agreements with Big Cable that

eliminate this competition, Verizon now has little incentive

to continue investing in FiOS. This will leave about one-third

o Verizons in-region customers without FiOS, and result

in thousands o job lost.

8


11/14

PROMOTING THE

DIGITAL DIVIDEVerizon is building its all-fber, high-speed network

throughout many suburbsbut its leaving urban and

rural areas behind.To date, Verizon has reused to deploy its FiOS network in a

number o largeand medium-sizedcities in its landline

ootprint, including Boston, Baltimore, Bualo, Albany, and

Syracuse, among others and has made it clear that it has

no intention o urther investments in FiOS in these or rural

areas. People o color and lower-income households will

be disproportionately aected. Given the critical importance

o high-speed Internet to economic development, job

creation, improvements in education, health care, energy

conservation, and public saety, these communities must not

be let on the wrong side o the digital divide.

Cities Without FiOS, Surrounding Suburbs With FiOS

City FIOS Median Household Income Poverty Rate % Minority

BUFFALO $29,285 28.8% 44.9%

BUFFALO SUBURBS X $56,925 8.2% 4.9%

BALTIMORE $38,346 25.6% 72%

BALTIMORE SUBURBS X $95,386 7.7% 49.4%

BOSTON $49,893 23.3% 52.3%

BOSTON SUBURBS X $82,816 8.3% 22.9%

ALBANY $39,158 25.3% 44.8%

ALBANY SUBURBS X $70,540 5.4% 13.4%

SYRACUSE $30,891 31.1% 38.0%

SYRACUSE SUBURBS X $52,961 7.0% 6.7%

Source: Calculations based on U.S. Census, American Community Survey, 2006 through 2011.

9


12/14

OPPOSINGCONSUMER RIGHTSVerizon is standing in the way o the open internet.

Verizon, an ALEC member, is undermining state laws

In December 2010, ater a long and contentious fght,

the Federal Communications Commission (FCC) issued

comprehensive rules to protect an open Internet. The

FCCs rules prohibit discrimination and blocking on the

Internet, require ull transparency and ree speech, and

cover wireless networks while acknowledging technological

dierences. These careully crated rules were endorsed

by a broad range o public interest and consumer groups,

labor organizations including CWA, civil rights groups,

environmental organizations, broadband providers, sotware

developers, and Internet applications companies.

Verizons lobbyists in state capitals are pushing to eliminate

all current consumer protections on the traditional

telephone network and prohibit any uture telephone

consumer protections.

Verizon and ALECs legislative allies have enacted bills in

over 20 States to eliminate protections on the traditional

telephone network or pre-emptively prohibit any consumer

protections or VoIP telephone service, which is the dominant

telephone technology or the uture.

Legislation to end consumer protections pads corporate

profts at the expense o telephone customers, who get

But not by Verizon. Instead, Verizon took the FCC to court

to overturn the rules. Verizon almost alone among telecom

companies has come out against regulatory oversight to

protect an open Internet. The case will be heard in the all

o 2012.

One would think that Verizon would be ashamed to demand

the right to discriminate among customers on its network.

Not Verizon.

higher prices, worse service, and even lose their guarantee

o access to the network.

Verizon has unded the notorious American Legislative

Exchange Council (ALEC), which is pushing to eliminate

State-level consumer protections. ALEC is the pre-

eminent corporate-unded orce behind identical, nearly-

simultaneously introduced legislative initiatives including

bills to take away voting rights, destroy public sector unions,

and orce through so-called Right-to-Work laws.

10


13/14


14/14

www.verigreedy.com

Broken Connections: An Alternative Annual Report for Verizon

Documents

Transcript of Broken Connections: An Alternative Annual Report for Verizon