TEAM–IFPTE Local 161 Employee feedback on the subject of contractors, and the business case for a different approach Compiled in response to MTS Allstream request to increase previously agreed cap on contractor numbers by 72% July 9, 2009

An Important Issue  July 3 rd TEAM sent an invitation to members to attend a focus group to discuss company’s request  The response exceeded our expectations  July 7 th and 8 th held focus groups. 60+ members participated  Numerous s have been received from members unable to attend focus groups

Current Understanding (From focus group participants)  APEX is just one piece of the HSPA initiative; touches most areas of the business  A clear understanding of the importance to the business  Excitement about potential employee involvement  Realization and concern that older systems will become obsolete

Concerns re Contractors (From focus group participants)  When contractors come in, opportunities go down  Insufficient knowledge transfer retains contractors  Cost to the Company  Dollars spent on contractors reduces dollars for training  Asked to train newly deployed contract staff; if given the opportunity, staff could do the job

Concerns re Contractors (From focus group participants)  Multiple contract extensions and associated costs  Contractors gain knowledge on new systems while employers are held back on legacy systems  Employees reporting to contractors  Apparent lack of Human Resources Strategic Planning to support the Corporate Business Plan

True Costs of Contractors  Contractor Costs + Administrative Costs + Conversion Costs – Any New Revenues Achieved = The Total Contracting Cost  ‘Plus’ costs associated with sliding project timelines, contract extensions renewals, and more contract administration  The cost to employee morale

Employees: Part of the Solution (Feedback from focus group participants)  Appeal to the Company’s Senior management to develop a real process through which: -Employees can identify their interest to participate -TEAM members are fairly assessed for suitability in order to fill project roles first -TEAM members are assessed for backfilling roles first, then Terms and IBEW or CEP members -Contracted services are only utilized when other deployment options have been exhausted -Displacement of contractors is an ongoing process

Workforce Demographics  Aging Workforce: Currently over 360 TEAM members with between 26 and 35+ years of experience, could leave the Company at any time, (88 IT Staff and 273 Non-IT staff) This is 32% of the company’s experienced knowledge base in TEAM  Critically: 128 TEAM Members, representing 11% of MTS’ senior IT professionals, have between 21 and 25 years of service. These members will be approaching retirement age within the next 5 to 10 years

Making it Happen  Company adopts an MTS Employees First Policy Employees are given: -first opportunity to fill positions -first opportunity for training to qualify for project assignment -first opportunity to backfill for employees assigned to projects -first opportunity to gain knowledge and experience provided by the project

Making it Happen  Hire Term employees before contractors  No employees to report to contractors  TEAM-IFPTE Local 161 is willing to help expedite the Term Position posting process, in preference to bringing in a contractor  TEAM-IFPTE Local 161 is dedicated to helping the Company achieve it’s stated project goals in a thoughtful, business like and collaborative manner

Benefits  Benefits TEAM Members through their participation in project work  Retains the knowledge, skills and abilities in-house  Allows savings accrued from contractor costs to be utilized for educating and training TEAM members  Develops a pool of potential new talent  Facilitates succession planning to the benefit of the Company’s long-term profitability and viability  Develops a process to handle requests for increases in the contractor allotment more efficiently and effectively  Minimizes the need for contractors