With an accounting scandal behind it and significant revenue challenges ahead, Qwest this week begins talks on a new contract for nearly...

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DENVER — With an accounting scandal behind it and significant revenue challenges ahead, Qwest this week begins talks on a new contract for nearly 25,000 employees.

Two Qwest unions say they want an increase in base pay — their first in nearly five years — and a continuation of health-care benefits, among other things. A Qwest spokesman declined to discuss what will be on the table.

The talks, scheduled to begin today, come at a critical time for Qwest, which is burdened with $17 billion in debt and diminishing revenue as competition increases from mobile and Internet phone services. In addition, Qwest last month lost a $9.85 billion bid for MCI.

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LeRoy Christensen of the Communications Workers of America (CWA), expects the talks to be difficult.

“When you negotiate with any company that’s not doing so good economically, you have to recognize that,” he said.

The talks will involve the CWA’s District 7, representing about 24,300 workers, and the International Brotherhood of Electrical Workers, representing about 350 employees in Montana. The current two-year pact is set to expire at midnight Aug. 13. District 7 also includes Washington, Oregon, Idaho and Alaska.

In addition to wages and benefits, the six-member union bargaining team plans to discuss outsourcing and worker-productivity issues, Christensen said.

“There are concerns particularly around productivity,” he said. “The company has been trying to increase productivity, get more work in the same amount of time. There’s always an ongoing issue of mandatory overtime.”

Jeff Miller of CWA’s national office expects both wages and benefits to be key issues since businesses across the country are seeking ways to control rising health-care costs.

In 2003, Qwest workers approved a contract with two bonuses instead of a salary increase in part because of the company’s problems at the time — $20 billion in debt, stagnant revenue and government probes of financial statements.

Analyst Donna Jaegers, who tracks Qwest for Janco Partners, does not expect a strike. She said Qwest needs to retain the support of its work force because of the competitiveness of the industry.

“I think you’ll get a lot of rhetoric beforehand but at the end of the day they’ll work together,” she said. “The union understands Qwest’s situation.”

Qwest spokesman Steve Hammack declined comment other than to say, “We have a strong and positive working relationship with our unions.

“We’re all committed to the same goal and that’s delivering outstanding service,” he said.