CWA Urges FCC to Reject T-Mobile's Proposed Acquisition of UScellular

In Petition to Deny Filed with FCC, CWA Calls for Protection of Retail Wireless Workers 

WASHINGTON, DC ‒ The Communications Workers of America (CWA) filed a Petition to Deny with the Federal Communications Commission (FCC) Monday urging the Commission to reject T-Mobile's proposed acquisition of UScellular as it currently stands and require specific enforceable measures that protect retail wireless workers and consumers. The comments raise serious concerns with the proposed acquisition, outlining how the merger would harm the public interest by substantially lessening competition in local markets where UScellular operates, thereby hurting workers, consumers, and other rural carriers. CWA represents tens of thousands of workers in telecommunications, including at wireless retail stores nationwide.

DISH, the Rural Wireless Association, and Public Knowledge have also filed petitions calling on the FCC to reject the acquisition.

CWA notes in its petition that T-Mobile and UScellular have not proven how their transaction will enhance, let alone preserve, existing competition in multiple labor markets. In the petition, the union points out that T-Mobile already has significant market power over workers. If the merger is successful, retail wireless workers’ ability to counterbalance T-Mobile’s power will be even more constrained.

“Just four years ago, T-Mobile secured immense market power when it acquired Sprint by making false promises about job creation and preserving competition. Instead, the company cut jobs, suppressed wages, and left workers afraid to speak out. Now, T-Mobile wants to continue its takeover of the industry by purchasing UScellular,” said CWA President Claude Cummings Jr. “We have seen what mergers of this scale can mean for workers if they can’t protect themselves through union representation, and it’s not good. It’s up to regulators to require strong, enforceable conditions to ensure that workers and consumers don’t take a back seat to corporate profits. If not, we will see an industry-wide race to the bottom.”

The T-Mobile/Sprint merger in 2020 provides a clear case for the dangers of another T-Mobile merger. The merger resulted in anti-competitive effects in many local labor markets for retail wireless store employees and increased the combined company’s power to cut or freeze wages, slow wage growth, and degrade benefits and working conditions. Notably, this was done without prompting many workers to quit because, as the comments detail, wireless retail workers develop industry-specific knowledge that is not easily transferable to other commission-based retail positions. A merger with UScellular is expected to have a similar effect in the 18 states where UScellular operates, further increasing T-Mobile’s power.

CWA concludes the Commission should not approve the merger without “clear and enforceable commitments by the Applicants to protect retail wireless workers generally and in the affected local markets where T-Mobile and UScellular operate.” CWA also asks that the Commission consider the concerns of rural wireless carriers, which play an important role in the connectivity ecosystem. Among the proposed commitments CWA suggests are:

• Ensure that the transaction does not cause a reduction in U.S. employment and that no employee of T-Mobile or UScellular loses a job because of this transaction.
• Complete neutrality in allowing employees to form a union of their choosing, free from any interference by the employer.
• No degradation of pay/benefits for five years post-merger.
• Additional measures to protect competition in labor markets.
• Extending other rural carriers’ roaming agreements with UScellular under the same terms.

Harming Local Workforces While Shrinking Options for Consumers

Additionally, CWA notes that neither T-Mobile or UScellular is unionized, meaning workers would enter the merger lacking the ability to negotiate through union bargaining, a key to counterbalancing the significant market power that results from such mergers. T-Mobile, notably one of the worst labor law violators in the country, has a long history of preventing workers from engaging in protected concerted activity, adding an additional hurdle for retail wireless workers at a combined T-Mobile/UScellular.

In preparation for filing its petition, CWA conducted interviews with retail wireless workers who have expressed concern that this merger will further increase T-Mobile’s power to reduce job security and generally degrade working conditions. Workers told CWA in interviews that they have experienced a significant drop in take-home pay following a reduction in commissions in the spring of 2023. Workers said they see these cuts as potentially making UScellular more attractive as a merger target and are fearful of job cuts in the wake of a T-Mobile takeover. As one worker told CWA in an interview, “Prevailing sentiment is we will be out of a job.”

If successful, the merger also presents concerns about a lack of alternatives for customers, leaving them with even fewer options amid an already highly concentrated market. Competitive rivalry among carriers leads to reduced prices and higher quality service, and if the market becomes more concentrated, consumers can expect to see a rise in cost and degradation in quality.

Rural wireless carriers will also be impacted. UScellular has become a major regional reseller of wireless services to other rural wireless carriers and mobile virtual network operators (MVNOs) through competitive roaming agreements. If purchased by T-Mobile, these established relationships could be upended and destabilize the remaining and struggling small carriers.

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