Your Training PlanMobilize

2014 AnnuAl RepoRt

Bargained in 1986, e Alliance was born out of a shared vision by our stakeholders that the growth and development of an individual is the key to success in a competitive, worldwidemarket place. e Alliance was created as a non-profit, unionized corporation designed to serve as a resource for individual employees who wanted to enhance their employability throughcontinuous learning.

is venture has been one of the most successful labor/management initiatives in the United States. Since inception, e Alliancehas served over 175,700 individuals with approximately 16.5 million hours of training in areas ranging from Career Transition Service,Customer Sales and Service skills to training in Advanced Communications Technologies and IT Certification.

is year alone, e Alliance served over 3,700 participants in approximately 168,000 training hours. Courses ranged from “Essentialsof Workplace Excellence and Collaboration” to customized introductory courses on PBX and VoIP/SIP system security. And let’s notforget the fact that since the inception of the AT&T Article 43 and Avaya certification programs, over $12.4 million in certificationpay and bonuses have been paid to Technicians who have taken advantage of our training programs!

roughout this report you will see highlights of the numerous projects and training opportunities across the country that ourparticipants have been involved in. Alliance LIVE! (Virtual Instructor Led Training over the internet) continues to grow as ourparticipants become more geographically diverse. Our partnership with the various stakeholder companies and theirlabor/management common interest groups are stronger than ever before and continue to be beneficial for all of the parties involved.

ese achievements reflect a critical component of e Alliance success, the capacity to evolve with changes in the industry and the shiing needs of our customers and stakeholders.Currently we are in the midst of creating,collaborating and customizing a series ofcertification pathways to powerfully set up ourparticipants for the future.

As always, in closing, we would like to take thisopportunity to once again thank the Bargainersfor the ingenuity and foresight to bargain eAlliance 28 years ago and to thank e Alliancestaff for their continued dedication and hardwork, without which e Alliance would not beable to achieve these successes. We wish tothank e Alliance Local Committees who areinvaluable in bringing training opportunities totheir worksites, and our participants and vendorpartners for supporting our training initiatives,as well as our Board of Trustees for their

ongoing support and guidance.

CHARLIE REICHOLDAVAYA INC. - Senior Manager, Labor Relations

LAURA REYNOLDSCWA - Vice President, District Nine

CHRIS SHELTONCWA - Vice President, District One

BOARD OBSERVERSTEPHANIE STREETOFS - Senior Vice President, Human Resources

BILL BATESCWA - Vice President, Telecommunications & Technologies

DIANE BRADLEYAT&T - Assistant Vice President, Labor Relations

STEVE MUSCATALCATEL-LUCENT - Senior Director, U.S. Workforce Relations

MARTHA PULTARIBEW - Director, Telecommunications Department

BERNIE RAGLANDAT&T - Vice President, Wholesale Service Delivery

BOARD OF TRUSTEES

Co-Executive Director Message

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• The 2014 Fiscal Year (FY2014) was a highly successful one in AT&T. National training initiatives along with Alliance Local Committee training at major locations resulted in morethan 135,000 hours of training with 54% of the eligible population participating.

• The AT&T GNFO Business Unit and CWA national Article 43 Certification Program continued to build on past success with an emphasis on Fiber Optic certifications and broadparticipation with more than 24 different certifications achieved. With 55% of the Article 43 Techs now earning certification pay, over $4.6 Million in certification payments have beenaccumulated since this program started in 2005.

Alliance Local Committees combined personal/professional development courses, on-time Business Unit Initiatives andgrowing Alliance National Program participation to produce a broad range of on-site training opportunities andexceeded participation goals for the year:

Minneapolis, MN – established an 8-hour on-company-time course menu; the Center for Independent Learning(Basic Skills training with tutorial support) had growing participation; and the two ALCs in the location begancoordinating course offerings.

Piscataway, NJ – Global Fraud Management Organization – provided a customized introductory course on PBX and VoIP/SIP system security issues offered as a Business UnitInitiative.

Atlanta/Alpharetta, GA – both the Morosgo and Alpharetta sites continued to provide strong on-site training – highlighted by Six Sigma Green Belt training in Alpharetta and acustomized VoIP/Ethernet Business Unit Initiative in Morosgo.

Sacramento/San Ramon, CA– the Sacramento site continues to plan a centerwide Alliance program with Business Unit Initiatives covering Program Logic, and Fiber and Connectors;San Ramon has been reinvigorated after moving from Pleasanton with a range of personal/professional development classes and an on-site Center for Independent Learning.

Norton, VA, New Castle, PA and Miami, FL – these three Dual Party Relay Centers (DPR) launched an array of Career Transition activities in response to changes impacting theDPR business. At all the centers LifeWork Planning, resume and job search skills training and financial transition have been a focus, along with an emphasis on occupational trainingat local community colleges and through The Alliance Pre-Paid Tuition Program. Both New Castle and Miami have established on-site Centers for Independent Learning to supportBasic Skills training and test preparation skills training. As a result of these activities, nearly all of the individuals at these centers have participated in Alliance training this past year.

Lee’s Summit, MO – National Back Office Work Group for AT&T Home Solutions – provided a customized, 4-hour, diversity course, designed to enhance the customerrepresentative’s ability to embrace diversity in the workplace and foster teamwork within and across teams to improve productivity.

St. Louis, MO– Advanced Features Service Center and RESPORG - delivered a customized communication course designed to help clerks improve service to customers inside andoutside the organization. The training identified how effective communication skills help to foster a positive work environment by reducing conflict.

ALLIANCE HIGHLIGHT!

Mobilize Your Training Plan

During the last fiscal year, Alliance participantsranged in age from 21 to 82; proving that it’s nevertoo early or too late to start Alliance training.

AT&T

LOCAL TRAINING

NATIONAL TRAINING

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Virtual Instructor Led Training continues to grow as a proportion of Alliancetraining. Over the last three years, the number of VILT participants andtraining hours increased by over 200% and VILT comprised 31% of the totaltraining hours last year.

ALCATEL-LUCENT

Mobilize Your Training Plan

AVAYAAlliance training in Avaya was up substantially during FY2014, generating47% more hours of training than last year.

Avaya Technician Certification Program – this IT CertificationProgram accelerated significantly during the year, with 59% of the techniciansparticipating. CS1000 System training and the new SSCA – SIP Certificationrepresented most of the increased activity. By years’ end, total enrollments inthe program had more than doubled over last year and total certificationswere up nearly as much. is activity raised the total bonuses paid out to techsfor certifications to over $7.8 Million since the program started in 2006.

Oklahoma City – OEFC/SOSC Center – this site continues to sponsorone or more Alliance Business Unit Initiatives annually. In April, an 8-hour“Essentials of Workplace Excellence and Collaboration” course was providedcenter-wide. e goal of the training was to refresh communication skills andteach collaboration techniques to improve communication withinworkgroups and across departments. Participant feedback and pre/postassessments reflected high satisfaction with the training and a significantincrease in collaboration skills.

Denver – GSS Center – the move of this location during the year slowedAlliance activity. However, on-site classes in SIP Certification were successfuland individuals continued to pursue other occupational training through eAlliance Pre-Paid Tuition Program, IT Certifications in the AT&T Article 43Program, and online training in e Alliance Skillso Program.

ALLIANCE HIGHLIGHT!

Bell Labs – with the transition of both the Murray Hill, NJ and Naperville, ILlocations to Sodexo in May, Alliance activity was primarily focused on CareerTransition activities with on-site classes to help individuals develop education plans,explore job search options, and construct financial transition plans. Nearly all theindividuals at these two sites participated in Career Counseling and FinancialTransition offerings, including SVTP conference calls. As a result of collectivebargaining, Alliance funding was set aside to continue Alliance services forindividuals who transferred to Sodexo.

Installation – Alliance activity for the Installation group was lower than in peakyears although nearly 30% of the Installers did participate during the fiscal year.e Northeast and Midwest Regions continued to offer Installers Catalog trainingwith courses in Fiber Certification, Connectors, Low Voltage Safety and CustomerService – all provided on company time. Financial Transition training was includedin SVTP conference calls offered throughout the year. Individual career counselingservices were expanded to the New England area. In addition, individual Installersenrolled into available slots in IT Certification courses offered for AT&T Article43 Technicians and began to access personal and professional development coursesoffered in the Alliance LIVE! menu.

e optical Fiber Solutions (oFS) manufacturing plant in norcross, georgia continued to have an activeyear in FY2014. along with standard First aid and Safety offerings, a Microso office certificate seriesstarted in September, offering 6-hour classes covering Word, outlook, excel and powerpoint. as a followup to the lean Six Sigma training provided last fiscal year, several teams were initiated to addressrecommendations formulated in the classes. redesign of the post Draw area and other processimprovements were implemented. e Sturbridge, Massachusetts facility also ran First aid and Safetyclasses during the year.

Mobilize Your Training Plan

Denise Wood proclaims that she loves to learn and attends as much alliance training as she possibly can. Virtual instructor led trainingis a perfect fit for her lifestyle, since she lives over an hour away from her job at the at&t relay center in rural norton in westernVirginia. e center is slated to close as at&t announced it is exiting the business. With all the training she takes online, Deniseinvariably finds that something she has learned in a class helps her be more productive in her job.

e first person to finish e alliance’s new healthcare it technician certificate program, Denise completed over 88 hours ofcoursework and passed multiple assessments on her way to earning comp tia Strata it and healthcare it certifications. She’s alsobeen taking a variety of other it certification classes, like a+, project +, Mta networking essentials, and ccnt - and that is just the

tip of her training resume. When a printer problem at work threatened to delay her task, she used something she learned in the a+ classto help her navigate around the problem until a technician could fix the printer. While she’s always enjoyed Microso desktop training to help her at work (she’scompleted all the MouS cetifications), Denise has also taken multiple publishing and photo editing classes. using this knowledge, she creates the local alliancenewsletter. Quick to point out her peers’ successes too, she hopes the newsletter inspires others to see that training is “lots of fun” and that it’s “not that hard” to do.

her family has been in the area for seven generations, a fact Denise used some of her alliance training to help her research and document, and she is deeply rooted in hercommunity. a firm believer that training opens opportunities, lately she’s been working on developing some of the skills she believes will be needed for 20/20,completing cloud essentials. as to what the future holds – she doesn’t know, but she’s preparing for “lots of things” and we’re confident she’ll be successful. her secret toearning all those certifications? She says she doesn’t worry about getting an a, B, c, or D. She simply focuses on the goal of passing the exam and says she tells people to“breathe easy” if you don’t pass right away, there’s always another opportunity to take the test. With that attitude – she’s sure to land on her feet.

Since we processed our first Alliance Pre-Paidtuition application in August of 1986, nearly25,000 individuals have participated with morethan $48M paid out in tuition. e first PPtapproval went to James Anderson for a Biologycourse at the University of nebraska - 8/30/1986.

AlliAnce HigHligHt!oFS

Spotlight on participant SucceSS

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Statistical Results

UNRESTRICTED REVENUE CWA IBEW TOTAL AT&TALCATEL-LUCENT AVAYA OFS TOTAL

Base Funding (1) $ 7,322,378 $ 71,155 $ 7,393,533 $ 6,000,000 $ 533,133 $ 860,400 $ - $ 7,393,533Investment and Other Income 89,987 20,586 110,573 75,600 15,565 18,145 1,263 110,573FAD/FAED Reimbursements 94,713 900 95,613 71,382 3,600 20,631 - 95,613TotalUnrestricted Revenue 7,507,078 92,641 7,599,719 6,146,982 552,298 899,176 1,263 7,599,719EXPENSESProgram Services 8,451,868 506,261 8,958,129 7,063,807 500,643 1,357,653 36,026 8,958,129Administrative Costs 452,101 17,689 469,790 368,034 47,800 51,656 2,300 469,790Total Expenses 8,903,969 523,950 9,427,919 7,431,841 548,443 1,409,309 38,326 9,427,919Change in Unrestricted Net Assets (1,396,891) (431,309) (1,828,200) (1,284,859) 3,855 (510,133) (37,063) (1,828,200)Transfer of Net Assets - - - - (186,149) 186,149 - -Total Net Assets - 09/30/13 9,775,664 2,622.983 12,398,647 8,631,705 1,854,349 1,762,954 149,639 12,398,647Total Net Assets - 09/30/14 $ 8,378,773 $ 2,191,674 $10,570,447 $ 7,346,846 $ 1,672,055 $ 1,438,970 $ 112,576 $10,570,447Less: Board Designated Net Assets (1,726,178) (104,436) (1,830,614) (1,418,200) (180,298) (215,230) (16,886) (1,830,614)Net Assets - Undesignated - 9/30/14 $ 6,652,595 $ 2,087,238 $ 8,739,833 $ 5,928,646 $ 1,491,757 $ 1,223,740 $ 95,690 $ 8,739,833

Financial HighlightsFor fiscal 2014, Revenues derived from the bargaining agreements totaled $7.4 million. Total Expenses exceeded Unrestricted Revenue by $1,828,000 for the year. For 2014,the Board approved supplemental revenues for up to $2.2 million specifically for training services. The result was a decrease in Net Assets to $10.6 million as of September30, 2014. Of the Net Asset balance, $615,000 represents Program Services commitments scheduled to begin after the fiscal year-end. Approximate ly $140,000 of the Net Assetbalance is comprised of investments in computer equipment, furniture and other capital assets. Of the remaining $9.8 million, $8.0 million are uncommitted funds availablefor use in fiscal 2015 and beyond and $1.8 million are restricted Board Designated Assets.The Alliance’s financial statements were audited by Plante & Moran, PLLC, Certified Public Accountants. The financial highlights were drawn from their audit report. Theallocations between CWA and IBEW, and AT&T, Alcatel-Lucent, Avaya and OFS were prepared by Alliance management.

STATISTICAL RESULTS FOR YEAR ENDED 9/30/14: AT&TALCATEL-LUCENT AVAYA OFS TOTAL

% ofGoal

Individuals Served 2,800 440 456 69 3,765 102%Participation Rate 54% 32% 64% 23% 51% 102%Enrollments 17,781 1,610 1,259 94 20,744 162%Enrollments Per Individual 6.4 3.7 2.8 1.4 5.6 160%Training Hours 135,649 5,644 25,830 903 168,026 - Training Hours Per Individual 48 13 57 13 45 -

STATISTICAL GOALS FOR 2015: AT&TALCATEL-LUCENT AVAYA OFS

Individuals Served 2,816 206 293 n/a 3,315Participation Rate 55% 20% 45% n/a 49%Enrollments 10,701 577 586 n/a 11,864Enrollments Per Individual 3.8 2.8 2.0 n/a 3.6

For the year ended September 30, 2014:

(1) Per the collective bargaining agreements, some or all of 2014 funding was suspended for AT&T/IBEW, Alcatel-Lucent, and OFS.

Mobilize Your Training Plan

Did you know?! e Alliance staff joined the cWA

staff union in 1992.

AlliAnce HigHligHt!

e first Alliance business unit initiatives were runin 1991 at Merrimack Valley Works, and atgeneral business services (now Avaya) sites in Westchicago, illinois and Minneapolis, Minnesota.last year 35% of our total training hours wereprovided on company time.

AlliAnce HigHligHt!

e Alliance for Employee Growth and Development, Inc. is a private, nonprofit unionized

corporation designed to enhance worker employability through continuous learning. An eight-

member Board of Trustees governs e Alliance. Four trustees are appointed by e Alliance

company stakeholders and four other trustees are selected by the CWA and IBEW. Alliance Co-

Executive Directors, one appointed by the companies and one by the unions, head up a staff

represented by the CWA Staff Union.

One of the most successful labor/management initiatives in the United States, e Alliance has been

recognized for its innovation and programming by former President Clinton, Secretaries of Labor,

governors and educational institutions, and has been the subject of numerous research articles and

publications.

The Alliance stakeholders share a vision that the growth and development of the individual is the

key to success in a competitive, worldwide marketplace. The Alliance was born out of this shared

vision to serve as a resource to individual employees who want to take charge of managing change

in their lives.

The Alliance supports individual efforts to develop career and personal growth and enhanced

employability through continuous learning experiences. The success of these indiviudal efforts

is assured by the cooperative activities of The Alliance and its labor and management partners.

About us

Vision

Mission

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The Alliance for Employee Growth and Development, Inc.80 Cottontail Lane - Suite 320, Somerset, New Jersey 08873

Toll Free: 800-323-3436 Fax: 732-563-1724

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