October 9, 2015
The Deadly Business of Climbing Cell Towers
Posted on May 23, 2012
By Ryan Knutson, PBS Frontline and Liz Day, ProPublica
In three-year contracts issued in 2008 that were examined by ProPublica and PBS “Frontline,” the matrices were blank for safety-related items, such as ensuring that OSHA standards were met. Contractors told us they understood this to mean the carrier wanted no involvement with them at all. AT&T declined to answer questions about the matrix.
In addition to outsourcing tower work, some cell phone companies funnel jobs through middlemen known as turf vendors. AT&T does this on almost all tower jobs; in 2010, Sprint moved toward a similar system.
Turf vendors—typically large construction management firms such as General Dynamics, Bechtel and Nsoro—oversee batches of tower projects, subcontracting out the climbing work to smaller companies.
Ed Reynolds, AT&T’s president of network services until 2007, said middlemen lessened the administrative burden on carriers, giving them one big contractor to deal with instead of dozens of little ones.
Square, Site wide
“You got one throat to choke,” he said.
But subcontractors often contract out jobs to other subcontractors. As jobs are passed down from one company to the next, there’s less ability to control who’s actually doing the work, said Mark Hein, who has worked for several turf vendors as a construction manager.
When he was sent to check on cell sites last year, Hein discovered many subcontractors that hadn’t been approved by the turf vendor.
“I’d show up on site and expect to find Company A and instead find Company Z,” he said.
Many of the crews he came across weren’t taking the most rudimentary safety precautions.
“They didn’t have their hardhats, they didn’t have safety glasses, they didn’t have safety gear,” he said. Many of the climbers lacked training certificates.
Hein did not have time to visit every site he was assigned to supervise—there were just too many, he said, a common lament among other construction managers for turf vendors.
Turf vendors also take a cut of what carriers pay for tower work—sometimes 40 percent or more—so subcontractors say they make less on these jobs.
In AT&T contracts examined by ProPublica and PBS “Frontline,” the carrier requires turf vendors to reduce their prices 5 percent each year over the three-year term of the contract. These reductions are typically passed through to subcontractors, industry insiders said.
“Guess who takes the hit? The next level [down],” said a construction manager for a turf vendor. “I’m not going to reduce the amount of money I take.”
Chris Deckrow, who owns a small climbing company in Michigan, showed ProPublica and PBS “Frontline” the price sheet for AT&T jobs. For the task of installing a remote radio head, the price sheet said, the carrier would pay the turf vendor $187 and the turf vendor would pay the subcontractor $93.
Deckrow said his company—which often works as a subcontractor of a subcontractor—has been paid as little as $40 for installing remote radio heads. Overall, he said, he makes less than half the money working for a turf vendor that he would make working directly for a carrier.
Hein said the difference in pay dictates which companies take jobs involving turf vendors.
“Rather than paying this amount to this guy, who’s really qualified and has a great reputation, they hire this person over here because he’s available right now and he’ll do it for what we want him to do it for,” he said.
Verizon, which hires subcontractors directly, tends to work with the same select group of climbing companies over and over, paying them more, subcontractors say. David Coleman, an industry analyst at RBC Capital Markets, described becoming a Verizon subcontractor as the “golden ticket.”
Several subcontractors complained that they had to cut corners to turn a profit on turfing jobs, using three-man crews instead of four, putting in 18-hour days, hiring less experienced men and working through inclement weather.
Reynolds, who now works as an industry consultant, dismissed such gripes. “There’s enough subcontractors out there willing to work,” he said. Those that don’t like the prices, he said, will “do something else.”
Buckling on a harness before mounting a 300-foot tower last March to check out a broken light, Deckrow described how tight margins erode safety.
He said he’s struggled to pay insurance premiums, cut back on training programs and delayed buying new safety gear for his men.
“This is stuff they have to wear every day in order to live through the day,” he said. “We would love to replace it every year, every two years. It’s not in the budget.”
Deckrow said earlier this month that he had decided to close his company rather than making further cuts.
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