Verizon Communications Inc’s two major unions set a new Sunday midnight deadline to complete negotiations over a labor contract for 65,000 workers, saying they may strike if a deal is not reached by then.

The workers’ contract had been due to expire on August 3, but the unions agreed last Saturday to extend the deadline after their bargainers reported significant progress in talks with Verizon.

“Since Saturday’s agreement to “stop the clock,” progress at the bargaining table has been uneven, particularly on outsourcing, subcontracting and union recognition issues,” the Communications Workers of America said in a statement.

Other issues in contention include health care costs for current and retired workers, and wage increases to adjust for rapidly rising food and gas prices, said the CWA, which has 50,000 members covered in the previous contract.

The majority of CWA members and the International Brotherhood of Electrical Workers, which has 15,000 workers, have authorized a strike if negotiations fail. Their members are employees in Verizon’s telecom unit.

The unit, which has about 103,000 workers, covers residential and small business telephone, broadband Internet and video services.