Union Picket Lines Stay Strong as FairPoint Stock Price Tumbles

Amy MasciolaPress Release, StrikeLeave a Comment

For Immediate Release: Monday, November 10
Contact: Jim McNeill, 202-213-1614, Jim@FairnessAtFairpoint.com

FairPoint stock plunged more than 10% at the end of last week after the company acknowledged strike’s adverse effect in its latest earnings report

One day before drop, key financial analyst cited strikers’ continuing strength, warning of “significant negative impact” from “unsettled labor conditions”

FairPoint strikers maintained momentum Saturday with major rally that highlighted N.C.-based company’s attack on good New England jobs

The ongoing strike at FairPoint Communications appears to be spooking investors and taking a toll on the company’s share price. FairPoint’s stock dropped more than 10 percent on Thursday and Friday. (It had dropped another 1.59 percent as of 11:10 a.m. Monday.)

The company’s stock tumbled after FairPoint acknowledged the strike’s adverse impact in its weaker than expected third quarter earnings report last Wednesday. That same day a key financial analyst reported that even after three weeks strikers were not crossing the picket line.

“Our members are not backing down from this fight,” said Peter McLaughlin, chair of System Council T-9 of the International Brotherhood of Electrical Workers (IBEW). “People are not crossing the line because we know the future of good jobs for every worker in New England is at stake.”

The proposals FairPoint has imposed would slash the pay of most new employees by more than 20 percent, undermine the benefits of current workers and eliminate health benefits for retirees who have given the company decades of service.

FairPoint cut off health care coverage for striking workers on Oct. 31. Some analysts predicted that the health care cut-off might cause workers to waver and end the strike.

But on Wednesday, Nov. 5, the same day FairPoint released its earnings report, financial analyst Barry Sine from Drexel Hamilton reported that “only a handful” of workers had crossed the line, and that there had been a “significant negative impact” from “the unsettled labor conditions.” Notably, Sine had earlier been one of the analysts predicting strikers might return to work when FairPoint terminated their health coverage.

“Our members saw this attack coming a long way off, so we were prepared for it,” said Don Trementozzi, president of CWA Local 1400. “FairPoint CEO Paul H. Sunu was a top official at Hawaiian Telcom when they launched a similar attack on their workers, so we’ve seen this playbook. We’ve been putting away money and bracing ourselves for this for more than a year.”

Roughly 500 striking FairPoint workers and supporters from across the Northeast rallied in Portland’s Monument Square on Saturday. Speakers at the rally recounted the troubled negotiations that led to the strike, which began on Oct. 17. During five months of bargaining that began in April, the North Carolina-based company made no substantive compromises. In August, FairPoint officials abruptly walked away from the table and imposed terms and conditions that include $700 million in savage cuts.

“This North Carolina company has imposed pay and benefit cuts that would turn good middle-class jobs into low-wage jobs with bare-bones benefits,” said Glenn Brackett, business manager of New Hampshire’s IBEW Local 2320. “This contract would also let FairPoint outsource good New England jobs to unqualified contractors from out of state and overseas.”

“All throughout these talks we’ve tried to find common ground with the company,” said Mike Spillane, business manager of IBEW Local 2326 in Vermont. “But they’ve never moved off their demands that would destroy good jobs at FairPoint. We’ve made $200 million in compromises, including a significant sharing of health care costs. It’s time for them to come back to the table with a constructive offer.”

FairPoint and union negotiators will reconvene in Boston on Nov. 18 at a meeting arranged by a federal mediator.

The International Brotherhood of Electrical Workers (IBEW) System Council T-9 includes local unions in Maine, New Hampshire, and Vermont and represents nearly 1,700 employees at FairPoint Communications. The Communications Workers of America (CWA) Local 1400 represents nearly 300 FairPoint employees in the three states. For more information, visit www.FairnessAtFairpoint.com.