The Merger of CenturyLink and Qwest – Implications for CWA Members CWA Local Officer Presentation August 2010

Presentation for CWA Locals With Qwest and CenturyLink Members Overview and Status Report on Proposed Merger A Tale of Two Companies -- Review of Union Contracts at Qwest and CenturyLink Meeting Challenges, Creating Opportunities – CWA’s Plans for Moving Forward

Overview and Status Report on Proposed Merger of CenturyLink and Qwest

Companies Claim Merger will Yield Gains for Customers & Shareholders Increase availability of high speed broadband access in largely rural footprint Expand availability of Internet TV services Implement LTE wireless data access Achieve significant savings through “synergies” – elimination of duplicate services, increased economies of scale for costly capital expenditures

Big Question: Can They Deliver? CenturyTel will be 8 times larger than it was before the Embarq purchase High risk investment with lots of debt –CTL will assume Qwest’s debt which is 5 times more than it currently owes CTL is a rural local exchange carrier with no experience with Qwest’s highly valued long-haul transport business

Mergers Expand CTL 800% in 2 years

Merger is Too Much, Too Soon CTL has not yet completed its merger with Embarq –Still integrating Embarq systems –Merger with Qwest will further distract them Failed to meet 1 st year broadband commitments, requested delay of FCC’s “1 Day Porting” order

Merger Must Be Approved Federal Trade Commission determined the merger passes anti-trust rules Special shareholders meetings Aug 24 Federal Communications Commission must determine if deal is in public interest State commissions must rule

CWA to Express Concerns in FCC and PSC Proceedings “determine whether… transaction serves the public interest…” “specific and verifiable commitments to improve service quality.” “concrete timetables and plans for systems integration” “assurances that the merged entity will not lead to any reduction in employment levels, workers’ living standards, and organizational rights.”

A Tale of Two Companies A Review of Union Contracts at Qwest and CenturyLink

Union Density Yields Union Power Non-Union 64% Union 36% CenturyLink 20,096 employees Qwest 30,138 employees Non-Union 48% Union 52% Combined Company 50,234 employees Union 45% Non-Union 55% Union Density By Company

Union Power Delivers a Single Contract at Qwest Qwest One Contract 51 Locals 14,384 CWA represented 100 IBEW In 1989 bargaining, Pacific Northwest Bell, Mountain Bell and Northwestern Bell were merged into a single contract with USWest. USWest was purchased by Qwest in CenturyLink 33 Contracts 31 CWA Locals 3,749 CWA represented 3,386 IBEW Both CenturyTel and Embarq are the results of many mergers and purchases of smaller, rural companies over the years.

Union Representation at Qwest and CenturyLink Call Centers

Union Power Delivers Better Wages

Union Power Preserves Better Benefits QwestCTL Bargaining over Benefits Company must bargain with union over benefits Company must notify union of change in benefits PPO Premium (CTL: for those earning $40-70K) $47/month single $94/month family $94/month family $34/month single $132/month family PPO Annual Deductible $250 single $500 family $300 single $600 family PPO Out of Pocket Max $1,000/year single $3,000/year family $2,000/year single $4,000/year family

Union Power Preserves Better Benefits (Continued) Network Services Qwest PPO CTL PPO Office Visit Co-Pay $25$25 Inpatient Hospitalization 90/10 coinsurance after deductible $250 co-pay, then 80/20 coinsurance after deductible Prescription Drugs Generic/Formulary/NonFormulary Retail $10/ $30/ $50 $7/ 30%*/ 45%* $7/ 30%*/ 45%** *$35 min/$60 max ** $45 min/$100 max Mail Order $20/ $75/ $125 $15/ $80/ $140

CenturyLink’s Strategic Plan: Use Divide and Conquer to Gut Contracts Current Arkansas Negotiations 1% annual lump sums, no wage increases Mgmt able to do bargaining unit work Cutbacks in overtime pay Concessions on disability, workers’ comp

Challenges for CWA Based on the Embarq experience, we know what to expect: Company will move work to unrepresented locations, where possible Management will try to bargain contracts down to the lowest common denominator or lower

Meeting Challenges, Creating Opportunities CWA’s Plans for Moving Forward

CWA Can Meet Challenges and Take Advantage of Opportunities CWA’s Goal: Provide secure jobs with good compensation throughout the companies Union strength at Qwest has come from wall-to- wall representation and one contract covering all employees CTL bargaining units can gain from experience of Qwest wall to wall representation Success will depend on our ability to mobilize and organize to expand Union power

CWA’s Strategic Plans 1.Negotiate safeguards for workers 2.Educate and mobilize members to engage in community and political action 3.Build power through organizing unorganized units

CWA’s Goals in Negotiations Employment guarantees Enhanced employment security provisions Expand organizing rights in Qwest contract to CTL Pave the way to share in company growth

Goal in Negotiations – Expand Organizing Rights Expand Neutrality Language at Qwest to all CTL The Company agrees to remain neutral during any organizing campaign … The Company agrees that when non-represented employees of the Company who perform duties similar to currently represented employees choose representation by CWA as a result of organizing efforts, the Company shall apply this Collective Bargaining Agreement … In other instances in which employees of the Company choose representation by CWA as a result of organizing efforts (e.g., the Union has organized employees who worked for an acquired company or who do not perform work that is similar to that of existing represented employees), the Company shall apply the grievance/arbitration procedures and other administrative provisions of this Collective Bargaining Agreement to these newly represented employees unless otherwise agreed…

CWA Members Must Mobilize to Express Concerns Locals must educate and mobilize members to act in their own interests Raise concerns about risks of the deal for consumers, workers and communities Contact Governors, State Legislators, Local Officials –Letters and visits Contact state PUCs –In states where CWA has not intervened, contact consumer advocate and commissioners –In states where CWA has intervened, do NOT contact commissioners

CWA Locals Must Mobilize Members In District 7 states: Educate and mobilize 5%-10% of membership SIF funds available for lost time Generate handwritten letters to Governors, legislators (PSCs in non-intervention states) Local Presidents to write Letters to Editors L/P coordinators set up meetings with key officials Member-to-member action to get more letters

CWA Locals Must Mobilize Members In CenturyLink-only states: Educate and mobilize membership SIF funds available for lost time Generate handwritten letters to CWA leadership for use in other states Local Presidents to write Letters to Editors