Frontier's Chapter 11 bankruptcy exit could be coming in early 2021.

Edward Gately, Senior News Editor

November 23, 2020

3 Min Read
Bankruptcy Court

The Communications Workers of America (CWA) is asking a Connecticut government agency to ensure Frontier Communications‘ bankruptcy reorganization plan includes improved service and job security.

Frontier’s Chapter 11 bankruptcy exit could come in early 2021. Eleven states have now approved its restructuring plan.

The Connecticut Public Utilities Regulatory Authority (PURA) is considering the proposed bankruptcy reorganization plan of Frontier Communications of Connecticut, dba Southern New England Telephone (SNET). The CWA has asked PURA to impose conditions on the organization. Those would make sure the plan enables SNET to improve service quality for consumers and preserve jobs in Connecticut.

The CWA represents more than 1,600 Frontier employees working as technicians and call center representatives in Connecticut.

Frontier filed bankruptcy in April as part of its restructuring support agreement to cut its debt by more than $10 billion. It filed in the U.S. Bankruptcy Court for the Southern District of New York. The court approved its bankruptcy reorganization plan in August.

Javier Mendoza is Frontier’s vice president of corporate communications and external affairs.


Frontier’s Javier Mendoza

“Frontier is seeking to restructure under Chapter 11 to eliminate more than $10 billion of debt and nearly $1 billion in annual interest obligations,” he said. “The company’s successful restructuring will enable it to make investments in its network and operations.”

Frontier will continue to be a competitive provider of communications services in Connecticut and 24 other states, Mendoza said.

Watching in ‘Frustration’

The CWA says technicians have “watched in frustration” as Frontier has failed to invest in its network and workforce in recent years. This has led to the declining condition of Frontier’s Connecticut plant, it said.

Staffing cuts have meant fewer technicians to provide critical maintenance and respond to customer issues, according to the union.

In April 2016, CWA represented nearly 2,400 employees in Connecticut. Over the last four years, the company has cut 740 positions, a full 30% of the unit, the union said. This has taken a toll on the quality of service Frontier can offer Connecticut customers, it said.

“The CWA members who work at Frontier know firsthand what the company needs to do to come out of this bankruptcy process stronger and ready to provide quality service to its customers,” said Dave Weidlich, CWA Local 1298 president. “That’s why we want to make sure that PURA uses its oversight process to hold Frontier accountable to its consumers and workers — not Wall Street hedge funds like Elliott Management that only care about making a quick buck.”

Concerns About Proposed Owners

CWA’s brief raises serious concerns about the future of the company under its new proposed owners. According to the proposed bankruptcy plan, four investment firms will own between 20% and 28% of the new company. Those are Elliott Management, Franklin Mutual, Golden Tree Asset Management and HG Vora.

The CWA is asking PURA to:

  • Require the profits and cash flow generated in Connecticut to be reinvested in Connecticut’s network. That should be coupled with service quality and employment requirements.

  • Require SNET to maintain its capital spending and in-state employment at least through 2024. It should also should consider requiring approval of any acquisitions or divestitures by Frontier in other jurisdictions.

This past summer, the CWA and The Utility Reform Network (TURN) raised concerns about Frontier’s proposed “virtual separation” plan that could split the company between areas.

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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