Who’s “overpaid” at Verizon?
Supporting the struggle of Verizon strikers to defend their good-paying jobs is a stand for improving the living standards of all workers, writes.
PITY THE poor Verizon executives. They're dealing with a strike by union workers who as individuals earn several times more in a year than the median income for a whole household--but they just keep demanding more and more, don't they?
That's the line that Verizon bosses are feeding the corporate press in the hopes that ordinary people who read it will resent the workers, and not them. Not surprisingly, the company's side of the story is showing up verbatim in news reports.
It's the old myth of the unreasonable union members who go on strike to help themselves, regardless of the trouble they cause for the company that provided them with a living.
But it's a pack of lies--and it's important for all workers to know it, whether they're in unions or not, and whether they live in the Northeast where the strike is taking place or not. Because if the members of the Communications Workers of America (CWA) and International Brotherhood of Electrical Workers (IBEW) at Verizon can stop management's concessions demands and defend their good union wages and benefits, it will be a victory for all workers, with tangible results.
VERIZON AND its public relations machine have filled the mainstream media with the figure $130,000. That's supposedly the annual "average" for union workers in wages and benefits. Major news outlets like the New York Times have repeated the number without question.
In reality, $130,000 is roughly what Verizon pays on average in labor costs per union worker each year. Strikers didn't see that much money in their paychecks--far from it. The figure of $130,000 includes the employer's side of Social Security and Medicare taxes, company costs for health insurance, and payments for pensions, which also fund benefits and health care for currently retired workers, not those on the job.
Plus Verizon is folding in overtime pay into its inflated number. Some of that money does at least show up in workers' paychecks, but one of the major grievances of union members is that the company has imposed forced overtime as a result of systematic understaffing.
According to the CWA's Stand Up to Verizon website, once you strip all that away, the "average salary of the striking Verizon workers is $74,000 a year. Highly skilled technicians, who install or service FiOS, with five or more years of experience, top out at $84,600 in New York and about $76,000 elsewhere. Customer service reps average about $69,000 a year."
The average salary works out to a straight-time wage of around $36 an hour--definitely a good wage in the U.S. economy today, but a far cry from the hourly of $65 that Verizon's figure implies.
But, hey, let's grant that because of overtime, many Verizon workers have annual gross pay in the neighborhood of $100,000 and even above. That's more than a lot of workers earn. But it doesn't even begin to start to approach the far reaches of what Verizon's top executives rake in.
Verizon CEO Lowell C. McAdam had total compensation of $18.2 million in 2015, putting him in the top 100 among his fellow corporate chiefs. His increase over the year before was 16 percent, according to the Equilar.com rankings of CEO pay for the New York Times--which is eight times better than the 2 percent wage hike that McAdam's company offered to "greedy" union members for last year.
Just McAdam's base salary of $1.6 million was 21 times the average salary of Verizon strikers. Add in a multimillion-dollar bonus and perks, and he was paid as much in cash compensation as two filled-to-capacity city buses' worth of Verizon workers.
Then there's McAdam's stock awards, which are a big part of any corporate CEO's total pay. When you put it all together and divide it over a year-round, 40-hour workweek, McAdam made $8,764.60 an hour. At that "wage," McAdam got almost as much for one day's worth of "work"--even without overtime--as the average Verizon striker earned in a year.
Suddenly, $36 an hour doesn't look like quite so much.
AND WHAT did Lowell C. McAdam do to deserve getting 246 times the average straight-time salary of a Verizon striker? This might be the most offensive thing of all.
It goes without saying that he spent not a moment of his valuable time on any of the tasks that Verizon's union workers perform every day on the job. Lower-level managers who only make a couple times more than strikers are trying to do that work during the walkout--and their often-dangerous bumbling shows how little they know about the labor that keeps the company's landline system operating.
Actually, a big part of the job that got McAdams millions was figuring out how other people would get less. He and other top executives with million-dollar paychecks are responsible for the aggressive negotiating strategy to extract concessions from the CWA and IBEW. They signed off on the cutoff of health care benefits to strikers and their families earlier this month.
McAdam is responsible for Verizon's decision to devote $13.5 billion to stock buybacks and dividends for shareholders in 2015 alone--enough to meet the unions' demands with a lot left over.
Last year, the company spent $4.4 billion to acquire AOL, and the price tag on Verizon's current attempt to take over Yahoo could run into tens of billions of dollars. Meanwhile, the same management sinking money into mergers and acquisitions has steered its fiber-optic network expansion to better-off neighborhoods, at the expense of predominantly Black and Brown ones.
In other words, when Lowell C. McAdam does his job well, other people get screwed over.
This is a basic fact about capitalism that belies the corporate propaganda about "overpaid" workers: The small minority of bosses at the top who truly are overpaid do little if anything that's productive or constructive to be so handsomely rewarded. On the contrary, their main role is wasteful, destructive--and often criminal, if not by the letter of the law, than in moral terms.
Earlier this year, Don Blankenship, the former CEO of Massey Energy, was found guilty for his company intentionally flouting federal mine safety laws, though he was acquitted of having any direct responsibility for the deaths of 29 miners in an April 2010 explosion at a Massey mine in West Virginia that led to the prosecution.
Blankenship was exceptional among CEOs in that he was actually held responsible for putting workers' lives in danger--though his sentence of a year of supervised release and $250,000 fine is a slap on the wrist. But if every CEO who put profits before workers' lives were put on trial, Corporate America would have to shut down.
Just as Massey Energy's bottom line depended on Blankenship putting miners to work in unsafe and ultimately deadly conditions, Verizon's executives and shareholders are best served when the company cuts back costs however it can--whether that means shortchanging customers whose complaints won't get heard or taking away the achievements of years of union struggle.
SUPPORTING VERIZON strikers as they defend their good-paying jobs isn't just a matter of standing up for basic fairness. Every victory for union workers makes the whole labor movement stronger--and it improves living standards for all workers, whether they're in unions or not.
According to a study by the Economic Policy Institute (EPI), having a union increases workers' wages by roughly 20 percent. In addition, a strong union sets a pay standard that nonunion employers follow. "[A] high school graduate whose workplace isn't unionized but whose industry is 25 percent unionized is paid 5 percent more than similar workers in less unionized industries," the EPI wrote in its report.
Based on their study, EPI researchers estimate that the overall impact of unions in raising wages for nonunion workers is almost as large as the impact on overall union wages.
Plus, unions have played a pivotal role--historically and through to the present day--in winning and defending labor protections and rights, on such issues as health and safety, overtime and medical leave, that benefit all workers.
As Joe Richard and Ruth Hurley wrote in a report for SocialistWorker.org:
Verizon strikers and their supporters...insist that, as one striker put it, paraphrasing an old labor slogan: "What we demand for ourselves, we want for all." Everyone deserves decent wages and benefits, and our side needs to wage more of the same kind of struggles that earned CWA and IBEW members a higher standard of living in order to win better gains for workers everywhere.
The CWA and IBEW are locked in a high-stakes showdown at Verizon. The bosses will stop at nothing to win this battle--they're pumping out propaganda to the media, pushing the courts to limit picketing, relying on police to protect scab replacement workers from any protest, and planning how they can keep the company going without union workers.
The unions can't sit back to see which side will last "one day longer" than the other. They need to mobilize mass demonstrations and picketing to put pressure on the company, even if that means breaking the law.
To do that, strikers need to be able to depend on fellow workers responding with solidarity and support as if the struggle at Verizon were their own--because it is.