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Rochester Tel taking shots from CWA members, DOT

With barely a moment to ballyhoo its recent victory in an ongoing labor dispute, Rochester Telephone Corp. is taking hits on several fronts, including a slap on the wrist from state officials and the latest salvo in a battle with the Communications Workers of America union.
Competitors are on the attack, too.
Complaints to the state Public Service Commission on Monday could be the prelude to an antitrust lawsuit that ICS/Executone Telecom Inc. plans to file against Rochester Tel, President I.C. Shah told the Rochester Business Journal this week.
Ongoing concerns that Rochester Tel, a local Frontier Corp. subsidiary, is violating terms of the open-market plan prompted Shah to send a letter Monday to PSC chairman John O’Mara. The PSC oversees competition in Rochester, which in January 1995 became the country’s first open market for local phone service.
“Frontier deliberately misrepresented itself to the Public Service Commission on various issues during the Open Market negotiations, and has intentionally inhibited competition from entering the marketplace,” the letter states.
Shah sent a previous letter to O’Mara in January, asking the PSC to prevent Rochester Tel from marketing unregulated products and services, including caller ID and Internet access. The company included promotional inserts for these services in billing statements mailed to customers.
Rochester Tel responded with its own letter to O’Mara in February.
In it, the firm’s general attorney, Gregg Sayre, asserted that the plan does indeed allow Rochester Tel “to retain– and by implication, to market–unregulated products and services.”
Sayre also contends competitors are able to place marketing inserts in Rochester Tel’s bills.
“ICS/Executone, AT&T, ACC and any other local or long-distance carrier are perfectly free to use this marketing channel,” the letter states, suggesting that Shah contact the firm for more information.
On April 15, Shah sent a letter to Rochester Tel’s president, Denise Gutstein, asking for details on how to use this marketing channel.
According to Shah’s June 24 letter to O’Mara, he has received no response to that request.
ICS/Executone also claims that Rochester Tel has not transferred its voice- mail services to Frontier Communications of Rochester Inc., the firm’s sister subsidiary. The open-market agreement mandated that Rochester Tel make the transfer or sell its voice-mail service to the highest bidder.
“It is my understanding that now Rochester Tel is petitioning the Public Service Commission to allow it to keep the voice-mail business,” Shah’s recent letter states. “Once again, here is another example of Rochester Tel’s ongoing monopolization of the open market.”
PSC spokesman Edward Collins said no such petition has been filed.
In April, Rochester Tel turned in a report outlining its performance during the first year of the open-market plan. PSC staff is working on its own report, which it expects to present to the commission later this summer, Collins said.
In an interview Tuesday with the Rochester Business Journal, Shah said he believes “the open market has turned out to be a big scam.”
Rochester Tel spokesman Randal Simonetti said such claims are “in a word, ridiculous.”
Rochester Tel is seeing market share shift as expected, he said, “which is slower than most people think.” Because of long business selling cycles, competitors typically need 12 to 18 months to establish themselves in the market, he said.
“It’s really on track as far as we’re concerned,” he added.
ICS/Executone is not the only competitor complaining, however.
AT&T Corp., which resells local phone service in Rochester, has filed a complaint with the PSC, hoping to force Rochester Tel to lower the rates it charges wholesale customers. A PSC judge is expected to hand down a ruling on that case soon, Collins said.
Shah believes the PSC is “so thrilled to be the first state in the country to have competition,” that the commission members “absolutely, literally look the other way.”
That’s one reason why ICS/Executone plans to take its case to court, Shah said. Other issues that Shah declined to disclose will be included in the firm’s antitrust lawsuit against Rochester Tel, he said. Shah expects his attorneys to file that suit within the next month or so.
ICS/Executone was involved in an earlier antitrust suit filed against Rochester Tel in the late 1970s. That suit eventually was settled out of court.
Legal action might be taken against Rochester Tel by state officials, too, unless the company cleans up its act on state highways.
The state Department of Transportation has issued a warning to Rochester Tel for failing to have permits that are required when working near state highways, a DOT official said.
On several recent occasions, Rochester Tel work crews had either inaccurate or expired permits, or they were not carrying copies of the appropriate documents, said Carla Melville, assistant to the DOT regional director in Rochester.
DOT permits are needed when working near state highways, whether on the road or on the right-of-way.
A stop-work order was issued June 10 to Rochester Tel crews working on Route 21 South in Ontario County. A Rochester Tel vehicle was parked on the road without work-zone signs displayed.
“If your crews continue to work in the state right-of-way before this matter is resolved, the State Police will cite them (under state law). Please note they also may be arrested and charged with trespassing,” the stop-work order stated.
Last week, DOT officials met with Rochester Tel management to address the issue, Melville said.
On Tuesday, at the company’s request, DOT officials held a training session for supervisors at the firm’s facility on Brighton-Henrietta Town Line Road, to review DOT rules and regulations, Melville said.
In addition to training, Rochester Tel has agreed to order the required road signs it needs when working on a highway’s right-of-way. And the firm has said it will make sure its work crews have copies of DOT permits, Melville said.
“We anticipate full cooperation from (Rochester Tel),” she said. “But time will tell.”
“It’s a problem we run across all the time,” Melville added, and not just with Rochester Tel. Other utilities and cable TV companies in the region have been issued warnings by DOT officials, too, she said.
Rochester Tel management has tried to blame union workers for its troubles with the DOT, CWA Local 1170 president Robert Flavin said.
“That’s a figment of Bob Flavin’s imagination,” Simonetti retorted. “We’re not blaming the union.”
“It has nothing to do with the union,” Melville agreed. “We don’t look at it from that perspective.”
CWA leaders, meanwhile, have not given up the fight against a contract imposed on members after negotiations between the union and Rochester Tel reached an impasse in April.
The CWA lost its appeal to the regional office of the National Labor Relations Board, which last week ruled that the company was not guilty of surface bargaining. The union plans to appeal that decision, Flavin said.
Meanwhile, the CWA is banding together with other local unions to protest a meeting to be held this morning by members of the Industrial Management Council. Representatives from Rochester Tel were scheduled to discuss strategies used in recent contract negotiations with CWA Local 1170.
In a memo titled “Rochester Telephone Bargaining Strategies–The Cancer Will Separate,” Flavin urged members of all local unions to join the protest from 7:30 a.m. to 9:15 a.m. Friday outside IMC offices at 930 East Ave.
At the meeting, Daniel Farberman, personnel director for Rochester Tel, Simonetti and other labor-relations staff from the company were scheduled to discuss Rochester Tel’s “preparation leading to bargaining, bargaining, and impasse and implementation of new terms and conditions of employment,” according to an IMC meeting announcement sent to its 350 member companies.
“This should not be construed by anyone as a how-to discussion,” Farberman said. He characterized the presentation as a 15-minute talk containing information previously reported by the media.
Simonetti said he will give a description of the communication strategy companies use in a crisis situation, including how firms can prepare in advance for that.
Rochester Tel has received a number of phone calls from other companies asking for advice regarding strategy and tactics used during the firm’s labor negotiations, Simonetti said. Rochester Tel previously solicited input from other companies that have faced unionized labor, including the Detroit News and Bell Atlantic Corp.

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