AT&T Inc has agreed to a one-year extension for a labor contract covering nearly 7,000 workers even as it continues negotiations indefinitely for thousands more workers.

The extension, until June 22, 2013, of the contract with the International Brotherhood of Electrical Workers came without any changes to the existing terms, AT&T said on Friday.

Both AT&T and its rival Verizon Communications are engaged in tough labor negotiations this year as they look to reduce costs to help offset the decline of their traditional home phone businesses.

Last August, Verizon Communications , was faced with a two-week strike after contracts expired for 45,000 workers. Almost a year later Verizon is still negotiating with unions for a new contract.

AT&T, which has a total workforce of 252,330 people, has been in negotiations for months with another labor union, the Communications Workers of America.

AT&T is still in negotiations with the CWA for several labor contracts covering about 40,000 workers after they expired April 7. Talks for those contracts are still ongoing.

The company started negotiations for yet another CWA contract covering 22,000 people on June 18 ahead of its Aug 4 expiration date.

AT&T shares closed up 48 cents or 1.37 percent at $35.35 on the New York Stock Exchange, where Verizon finished up 53 cents or 1.86 percent at $45.20.