WASHINGTON -- Research compiled by the Communications Workers of America (CWA) estimates that more than 30,000 family-supporting jobs will be at risk of elimination or a reduction in wages and benefits if AT&T’s leadership engages in the restructuring and divestitures proposed by Elliott Management and its CEO Paul Singer.
The research comes just days after CWA penned letters urging AT&T’s CEO, board of directors and largest investors and Business Roundtable to reject these controversial proposals that the union says will not only cut jobs but also destroy long-term value and are the “archetype ploy of vulture capitalists.”
“Elliott Management’s short-sighted activism has left families without jobs, and has harmed the long-term value of companies like Hess and Arconic,” said CWA President Chris Shelton. “Boosting earnings through headcount reductions, outsourcing and reduced investment surely benefits Paul Singer and Elliott Management’s wealthy investors, but what about everyone else? AT&T should increase prosperity and connectedness for all Americans by investing in its workforce and by building out next generation wireless and fiber broadband networks.”
Below is a breakdown of the jobs in jeopardy based on the union’s research:
- Approximately 10,000 union-represented workers who support DirecTV;
- An estimated 11,000 union-represented workers in AT&T’s wireline business who support service in rural areas, the geographic segment considered most likely to be targeted for divestiture;
- More than 8,500 retail sales jobs at corporate stores represented by CWA that would be eliminated if AT&T matches Verizon’s percentage of third party dealer-operated stores and closes an additional 5% of corporate stores to address Elliott’s concern of geographic redundancy;
- 900 union jobs at AT&T's operations in Puerto Rico and the Virgin Islands. AT&T announced on October 9 it plans to sell to Liberty Latin America, a company that has faced criticism in several Caribbean nations for eliminating good-paying union jobs and refusing to engage in constructive labor relations;
- Additional job cuts would arise from Elliott’s call for “outsourcing of non-core network functions,” an imprecise demand that could compromise AT&T’s ability to effectively operate its network and potentially impact thousands of additional technicians who build and maintain the network.
These estimates do not include the potential impacts on management-level employees and front-line workers who are not yet in a bargaining unit, such as the tens of thousands at Warner Media.
Vulture capitalist fund Elliott Management announced plans last month to extract profits from AT&T by cutting jobs and selling off critical assets while pumping up the stock price with billions in share buybacks.
Within an hour of Elliott Management’s announcement of its plan, President Donald Trump took to Twitter to praise the move. “Great news that an activist investor is now involved with AT&T,” Trump wrote, “As the owner of VERY LOW RATINGS @CNN, perhaps they will now put a stop to all of the Fake News emanating from its non-credible ‘anchors.’”
Elliott’s founder and CEO Paul Singer has invested in Trump, reportedly contributing $1 million to Trump’s Inaugural Committee and followed by an additional $1 million to a super PAC that supports Trump. Fortune magazine has called Singer “a passionate defender of the 1% and a rising Republican power broker.”
In response to Elliott’s proposed intervention at AT&T, CWA President Chris Shelton sent letters to AT&T’s CEO, board of directors and largest investors and Business Roundtable urging them reject Elliott’s proposals and commit to the principles that Business Roundtable laid out in its updated Statement of Purpose which laid out a vision of inclusive prosperity.
Senator Elizabeth Warren expressed her support for CWA’s position, tweeting: “Less than two months ago, AT&T signed a @BizRoundtable statement promising to value employees, not just shareholders. If they're truly serious, they should reject this plan to turn a quick profit by laying off workers and outsourcing jobs. I stand with @CWAunion.”