Questions and Answers s2

Questions and Answers

Please note: While all questions are reviewed, only representative Q&A will be posted on the Web site. Specific questions cannot be addressed in this forum.

Questions and answers added June 3, 2009

Q: When you mention a small deductible and a modest annual maximum, what is the exact dollar figure we are being asked to pay? – CJ; Willoughby, Ohio A: The second section of this document outlines the amounts of the deductible and annual maximums that are being proposed in the Southwest. The deductibles and annual maximums are tied to pay so that those that earn less pay less. The final offer pertains to the Southwest region only.

Q: [In the offer to District 6/Southwest], would the cost of our prescription copays be applied to the maximum out-of-pocket? – GW; Houston, Texas A: Amounts paid in deductibles, coinsurance and copays all count toward the out-of-pocket maximum – this includes prescription copays. Once the out-of- pocket maximum is met, 100 percent of eligible expenses are paid by the company for the remainder of the plan year. Details are available in the second section of this document.

Questions and answers added May 29, 2009

Q: What are the actual costs to employees? What are the actual wage increases? – RS; Houston, Texas A: This calculator provides a look at the estimated effect of the proposed labor agreement on you. After entering some basic information, you will be able to view a series of comparisons that show how your current pay and benefits will compare to the pay and benefits under the proposed agreement.

Q: Are the health payments going to be the same for years two and three? – MG; Atlanta, Ga. A: The second section of this document outlines the costs for all three years of the contract, specifically in the tables outlined in the relevant sections.

Q: Will you post the complete proposal from the company, including items that we have in the current agreement? – GS; Arkansas A: We ask that you contact the union for the complete proposal.

Q: So how much will be deducted from each paycheck per pay period for health costs? – OT; Dallas, Texas A: Annual deductibles are not deducted from your paycheck. They are paid out- of-pocket, potentially with funds from your company-funded Health Reimbursement Account, until you reach the maximum amount. Monthly contributions would be deducted from your paycheck. The amount depends on your coverage tier, which in the first year is $5 for an individual, $10 for an individual +1 and $15 for a family.

Q: What do the "steps" mean in the calculator for the proposed health care benefit package? – JE; Earth City, Mo. A: “Step” refers to the employee’s level of wage progression. It does not affect your health care benefit package; it simply allows the calculator to take wage progression into account when calculating your overall financial impact.

Q: Does an annual deductible for "family" of $1,500 cover everyone or is that $1,500 for each family member? – RG; Matteson, Ill. A: For employees electing “family” coverage, their annual network deductible would be no more than $1,500 (or 3 percent of their annual rate of pay if that amount is less), no matter how many eligible family members are covered.

Q: What is the difference between the annual deductible and the annual out-of-pocket maximum? – RG; Matteson, Ill. A: For services outside of preventive care, you will pay the full cost for eligible expenses until you meet your annual deductible. As long as you obtain services from network providers, the cost you pay is based on discounted amounts negotiated for the plan. The out-of-pocket maximum is a safety net for those participants with significant medical expenditures. Amounts paid in deductibles, coinsurance and copays all count toward the out-of-pocket maximum. Once the out-of-pocket maximum is met, 100 percent of eligible expenses are paid by the company for the remainder of the plan year.

Q: In the highlights listed in the Company’s final offer, out-of-pocket maximums include “Amounts paid in deductibles, coinsurance and copays all count toward the out-of-pocket maximum.” Are monthly contributions also included? – DP; Sand Springs, Okla. A: No, monthly contributions are not included.

Q: I am wondering why nothing was mentioned [in the offer to District 6/Southwest] as far as job titles that are being negotiated if any and what those job titles are? – LR; San Antonio, Texas A. As part of the Company’s final offer to District 6/Southwest includes a new incented sales title for positions in Consumer, Business and Credit & Collections. These titles will be available for existing employees, covered by the Southwest Core Contract, who voluntarily choose to go into the title, new hires and temporary conversions. To be clear, employees in existing sales titles such as Service Representative will have the option to remain in their current title or choose to go to the new sales title.

Q: Is it the Company's intention to make all the District's contracts 3 years? – DC; New Haven, Conn. A: The duration of the new agreements will be determined at the bargaining table. The terms of the currently negotiated labor agreements are in effect for five years, but past agreements have varied in length. The Company’s final offer to District 6/Southwest is for a three-year agreement.

Q: Why was CWA District 6/Southwest the only bargaining unit to receive a "final" offer? – MU; Oklahoma City, Okla. A: Based on the specific situation in the Southwest, we believe a last, best and final offer is appropriate at this point. Bargaining continues in all other regions – (CWA District 9), East (CWA District 1), Midwest (CWA District 4) and Legacy AT&T Corp. (CWA ComTech).

Q: Is the Company going to set a date that the union [District 6/Southwest] must accept the Company's last and final proposal? – JH; Dallas, Texas A: While there is no specific deadline for CWA District 6/Southwest to accept the Company's last, best and final offer, the ratification deadline for the signing bonus and retroactive pay is June 5.

Q: Why isn't there any mention about retirees? Are they not part of the bargaining? – SM; San Antonio, Texas A: Future retirees (those that will retire during the term of the agreement) were included in the bargaining process and provisions were set forth in the offer that address them. Current retirees are not part of the collective bargaining process. Q: Does this offer [to District 6/Southwest] make the prem techs permanent employees? – JD; Stratford, Conn. A: Unlike other regions, premises technicians in the Southwest are already regular full time employees.

Q: Can you explain how the calculator for the CWA District 6/Southwest region final offer determines wage increases? A13: Please see the help file within the employee calculator for a detailed explanation of the calculations. Calculator link

Q: Will AT&T still offer lump sum pension payment in the new contract for all eligible employees with 30 or more years of service? – LB; Tucker, Ga. A1. In the final offer presented to CWA District 6/Southwest Region, employees will continue to be able to take a lump-sum pension payout upon retirement.

Q: So, if District 6 doesn't accept the contract, what will the Company do? – RG; San Ramon, Calif. A2: It is our hope that CWA District 6 will take this proposal to the members, and give them the opportunity to vote on it. We’re optimistic that the employees will find this to be a fair offer and approve it.

Q: The contract proposal [to CWA District 6/Southwest] doesn't even mention what happens to TFT's?!? Am I looking for work or employed? Enlighten me please. – CD; St. Louis, Mo. A7: The offer to District 6/Southwest does mention TFTs. In response to union requests, the company offer agrees to the conversion of most Southwest Core wireline temporary employees to regular employees. These converted employees will receive the same medical benefits as other regular employees, a cash balance pension and access to post employment benefits at cost.

Questions and answers added April 14, 2009

Q: What are the ramifications for an employee who does not want to participate in the strike, should one be called for? – MB; Southfield, Mich. A: There are no penalties from AT&T if a bargained-for employee makes the personal decision to work during a strike. There may be ramifications from the union – but that is a question for the CWA to answer.

Q: If an employee is not a member of the union and there is a strike, will it be safe for him or her to turn out to work and not be harassed by other striking employees? – JB; Houston, Texas A: This is a personal decision and you have the right to work during a strike. The safety of our employees is always a priority.

Questions and answers added April 9, 2009

Q: What will happen to our insurance and dependant coverage if we strike? – JR; Cerritos, Calif. A: The company has the right to stop providing health insurance for striking employees and a decision will be made about that in the event of a strike.

Q: If there is a work stoppage from the union members, what will happen to the vacations and personal days scheduled during any work stoppage by the union members? – AJ; Brecksville, Ohio A: Generally, from a company perspective, in the event of a strike, if you are not at work you will not be paid – and this includes paid vacation time and personal days scheduled during this time. For specifics, employees should talk to their supervisors to determine how a strike would affect previously scheduled vacation time. Questions and answers added April 7, 2009

Q: Is AT&T ready for a strike? – no name given; Texas A: Yes, we are prepared for a potential strike. While we do not believe a strike is in anybody’s best interest, as a responsible, customer-oriented company, we must plan for all possible outcomes to these negotiations. Under our extensive planning efforts, managers and retirees have been trained to continue offering service to our customers. That training is nearing completion, and managers are prepared to move into their new roles immediately, should that be required.

Questions and answers added March 18, 2009

Q: What is the total number of employees covered by the Core wireline contract – for the East, West, Southwest, Midwest and Legacy T? – SH; Dallas, Texas A: The contracts affect about 110,000 Core (wireline) employees from across the country, from all of the CWA-represented legacy companies that make up AT&T. Under a special agreement between the union and the company, this also includes the labor agreement for employees in CWA District 3, the former BellSouth area, even though that agreement does not expire until August.

Q: Why does the bargaining committee feel it necessary to keep negotiations so secret? – RH; Holland, Mich. A: Focusing on negotiations at the bargaining table shows a respect for the process and, in our experience, it is there where solutions are found. Any agreements reached at the bargaining table will be presented to the union membership in full – and as appropriate, the Company will provide updates at www.att.com/corebargaining.

Q: What is the difference between a work stoppage and a lock out? – SM; Hayward, Calif. A: There are different types of work stoppages. A lock out is a management- directed work stoppage, as compared with a strike – which is a union-directed work stoppage.

Q: Where can I view the standing contract for SBC that includes AT&T Advertising Solutions? – AS; Charlotte, N.C. A: Accessible from the AT&T network only, all Advertising & Publishing labor agreements can be viewed here. Questions and answers added March 10, 2009

Q: Will there be specific language in the new contract to include term employees? – EC; Charlotte, N.C. A: Term and temporary employees covered by the CWA Core labor agreements are part of collective bargaining agreement and may be discussed in these negotiations. Questions and answers added March 5, 2009

Q: If AT&T is looking to shift health care costs to our retirees, how can you justify $33.5 million in compensation to your top five execs, who also have extremely generous pension benefits and free lifetime health care? – various employees; no location given A: AT&T provides competitive compensation and benefits, including health care coverage, at all levels. No active manager at AT&T has free lifetime health care. All managers from the CEO on down, make significant and similar contributions toward their health care coverage.

Q: Do you actually answer any questions? – AM; Austin, Texas A: Every question submitted to the AT&T Core Bargaining Web site is reviewed and representative questions are selected for posting. Some questions are not appropriate for response at this time since we are currently in negotiations.

Q: If a non-employee acquaintance asks me questions about these negotiations, does AT&T have a public webpage that I can direct them to for information? – DH; Hoover, Ala. A: This Web site – www.att.com/corebargaining – is a public Web site. It is accessible from any computer or device with Internet access and is available to any interested parties, including all employees, management and non- management.

Q: Under the special agreement, is Legacy BellSouth contract also expiring on April 4, 2009? Will we be obligated under the same terms of any new contract? Will we be able to vote to ratify the new contract? – PS; Montgomery, Ala. A: The Legacy BellSouth contract covers the Southeast region, or District 3. While an agreement was reached to bargain at the same time as the rest of the Core contracts, the District 3 contract does not expire until August 2009. The Southeast region will be given the opportunity to ratify the new contract and will be covered by the terms of the new contract.

Q: Why is health care a major issue? – GC; Atlanta, Ga. A: Our main health care objective is to offer high-quality, cost-effective health care coverage that is valued by our employees. AT&T subsidizes health care coverage for more than 1.2 million people – active employees, retirees and dependents – at an annual cost of $5.5 billion. These health care costs continue to increase at a rate that outpaces inflation, and in fact health care costs have doubled over the last 8 years. From a national perspective, Americans spent $1.7 trillion for health care in 2007 – exceeding the nation spending for housing, food or energy. In view of these numbers, it is not surprise that only 65 percent of U.S. business now subsidize health care for their employees.

Q: What benefits do AT&T employees receive? A: AT&T benefits are quite comprehensive, and include things like medical, dental, vision, 401(k) and/or pension, life insurance, and much more.

Q: What is the current state of health care coverage for our union workers? – SS; Bedminister, N.J. A: AT&T non-management health care plans are among the most generous and highly subsidized in the U.S., and richer than anything offered by our competition.

Questions and answers added February 27, 2009

Q: Will there be one contract for all of AT&T or three contracts – SBC, BellSouth and Legacy AT&T? – RC; Atlanta, Ga. Will these negotiations cover IBEW also? – JM; Hoffman Estates, Ill. A: AT&T has more than 50 union contracts and the company is almost always bargaining one or another of those. The negotiations that opened Feb. 24 are for Core wireline employees represented by the CWA in the East, Southwest, West and Midwest regions, as well as Legacy T Core contract employees across the country; those contracts all expire on April 4, 2009. CWA Southeast also chose to join in this bargaining, although that contract does not expire until Aug. 8, 2009; the Southeast employees would continue to be bound by the Aug. 8 expiration date. The IBEW contract covering about 10,000 employees in the Midwest region does not expire until June 27, 2009, and will be bargained separately. Core bargaining also does not include many other contracts such as Internet, Video and Mobility which have distinct contracts and are also bargained separately. There is no plan to combine any of the contracts.

Q. Who is bargaining on behalf of the company? A. As is customary, we have a team of Labor Relations professionals who are bargaining on behalf of the company.

Q. How will you keep employees informed on the progress of negotiations? A. With the beginning of bargaining, we are launching an Internet Web site www.att.com/corebargaining that will provide updates on bargaining as necessary. Note that this Web site is on the Internet so you can access it from any computer.

Q. What areas and employees are affected by this bargaining? A. This bargaining involves 110,000 Core (wireline) employees across the nation from all of the union-represented legacy companies that make up AT&T.

Q. What sort of work do these employees do? A. These employees are in wireline operations in both network and call center roles.

Q. What are the issues? A. This contract addresses the full range of issues from wages, benefits and pension to work rules.