MONTREAL – While it could be part of the game of high stakes, hardball negotiations, Expertech Network Installation said late today it will shut down after its technicians voted against a recent contract proposal which called for cuts in wages and benefits.
Over 1,700 jobs are at stake, with 1,300 represented by the Communications Energy and Paperworkers union who rejected the latest contract proposal.
The company says its prices are currently about 25% above market rates, and "urgently needed to put in place a competitive cost structure in order to retain its customers and remain viable." The higher cost base means tens of millions of dollars it won’t pay, says Bell Canada.
The telco is the majority shareholder of Expertech (with minority owner SNC Lavalin) and the primary customer of the installation and maintenance company, providing 90% of the company’s revenues. Bell issued a statement saying it will move on and will not renew its contract with Expertech which expires in June of this year.
In a statement, Bell said it "will proceed with an orderly transition of network installation services to alternate suppliers."
Without the restructuring initiated by Bell, "Expertech could not tender a competitive offer for a new long-term contract with Bell Canada," added the release.
In 2006, Bell went to the marketplace to solicit tenders for network installation services and Expertech prices were, on average, 25% higher than tenders received. Given Expertech’s status as a preferred supplier, Bell gave the company an opportunity to restructure to allow for the tendering of a more competitive offer.
"We would have preferred to continue working with Expertech, but the disappointing result of today’s vote means that the company will not be able to restructure and offer its services at a competitive price," said Patrick Pichette, president, operations of Bell Canada.
"We are deeply disappointed by the results of the vote," added Jacques Robichon, president and CEO of Expertech. "We needed this agreement to ensure the survival of the company. We have clearly stated all along that rejection of this offer would lead to closure. Employees were well aware of the stakes and the consequences. With the rejection of the offer, we have lost our major customer and we are no longer viable."
"The wind down of Expertech’s operations will be conducted in an orderly fashion over a period of four months. The company will assist all of its 1,700 employees through this difficult transition and treat everyone fairly in the process," says the Expertech release.
CEP isn’t giving up, however and warns of service disruptions, should the shutdown do ahead. "We are trying to get the company back into bargaining and we hope it will change its last position which would see our members’ wages, benefits and employment security be drastically reduced," said CEP spokesperson John Edwards, administrative vice-president, Ontario.
"If there is a disruption in this service, the fault will lie directly at the feet of Bell."
