CWA: T-Mobile customer center announcement “does not come close to offsetting” 30,000 lost jobs from proposed merger

The news that T-Mobile is planning to build five domestic customer experience centers if the proposed merger with Sprint is approved represents an attempt to obscure the fact that the merger would be a substantial net job killer for America, the Communications Workers of America (CWA) said today.

According to Debbie Goldman, Research and Telecommunications Policy Director at CWA, “Today’s announcement is a blatant attempt to obscure and soften the fact that the proposed T-Mobile-Sprint merger would eliminate 30,000 American jobs and remains against the public’s interest. T-Mobile and Sprint have a disturbing track record of anti-worker behavior, but even taking their announcement at face value, the projected jobs created do not come close to offsetting the 30,000 jobs that would be lost in communities across the country following the merger.”

T-Mobile’s new announcement comes as a growing number of elected officials and regulators are expressing concerns about the proposed merger’s impact on workers and consumers and ahead of a House of Representatives hearing on February 13. T-Mobile and Sprint also have a well-documented history of offshoring U.S. jobs and closing retail stores, such as following their acquisition of Iowa Wireless in 2018. This raises real questions about their credibility when it comes to job and worker-related claims.

CWA highlighted the following details about today’s announcement:

  • The planned jobs don’t come close to offsetting the 30,000 lost jobs that would result from the merger. The domestic positions that would be created through T-Mobile’s newly-announced customer experience centers, “up to 5,600 jobs” by 2021, would not come close to offsetting the 30,000 jobs that would be lost due to the merger, per CWA’s comprehensive economic analysis (see here for CWA’s state-specific breakdown of store closures and job losses). Further, the jobs would be concentrated in just five locations, while the jobs lost from retail store closures will impact hundreds of communities across the United States.

  • Wall Street analysts agree - the merger would lead to job losses. In addition to CWA’s detailed estimates, several leading Wall Street analysts claim that a portion of the $43 billion synergies from the merger will come from retail and headquarters job cuts.

  • Announcement doesn’t change how regulators should weigh the jobs-related component of their review. FCC precedent details that a proposed merger should be judged by the net impact on jobs - whether “the merged entity will support a larger or smaller number of domestic positions than the Applicants on a stand-alone basis.” (AT&T/T-Mobile Order, paragraph 261). Additionally, the new customer experience center announcement must be merger-specific, quantifiable, and verified in order to factor into the review. Today’s announcement is none of those. Finally, the related jobs commitment is three years away, while T-Mobile CEO John Legere conceded at a Senate hearing last year “there'll be a rationalization of jobs in the first year” of the merger.

  • T-Mobile and Sprint each have disturbing anti-worker track records and offshoring practices - will their offshoring practices continue? T-Mobile and Sprint each offshore a significant portion of call center work to the Philippines, Guatemala, Honduras, India, Mexico, Panama, the Dominican Republic, Costa Rica, and Canada. In 2012, T-Mobile laid off 3,300 workers when it closed seven U.S. call centers. T-Mobile attempted to deny its displaced workers much-needed federal benefits by refusing to acknowledge that the work was sent overseas, but a U.S. Department of Labor investigation concluded that the jobs had been offshored. T-Mobile has been guilty of violating U.S. labor law six times since 2015 and has been subject to approximately 40 unfair labor practice charges since 2011.

  • iWireless shows what happens to jobs after T-Mobile makes an acquisition. After T-Mobile's January 2018 acquisition of iWireless, a regional carrier in Iowa, T-Mobile closed more than 72 percent of iWireless corporate stores and more than 93 percent of authorized dealer stores. T-Mobile also shuttered iWireless customer call centers in Des Moines and Cedar Rapids, Iowa.

  • T-Mobile should make verifiable and enforceable commitments regarding jobs and workers: Instead of continued vague and unverifiable pronouncements, T-Mobile should  make a binding commitment not to eliminate jobs as a result of the proposed merger, not to lay-off any current T-Mobile and Sprint employee as a result of the merger, to return overseas call center jobs, and to stop violating federal labor laws and to fully respect workers’ rights. Barring those verifiable commitments, the FCC should not approve this merger.
     

Links:

T-Mobile, Sprint plan to build 5 customer experience centers if merger succeeds (Fierce Wireless, Jan. 30, 2019)
 

Could a Sprint merger with T-Mobile kill more jobs than Sprint has? (The Kansas City Star, Oct. 6, 2018)
 

T-Mobile/Sprint Facts (CWA, Dec. 2018)
 

CWA Reply Comments (CWA, Oct. 31, 2018)
 

Editor’s Corner—4 takeaways from the Sprint/T-Mobile Senate merger hearing
(Fierce Wireless, June 27, 2018)