Ratification vote is July 20
Globe, Guild reach tentative concessions pact

The Boston Globe and its largest union have reached agreement on a retooled version of a $10-million package of concessions sought by the company that lessens pay cuts in favor of diminished fringe benefits from an original agreement rejected by the union.

The almost 700 members of the Boston Newspaper Guild are scheduled to vote July 20 on the revised agreement. It contains a 5.9 percent pay cut. Guild members rejected by a 277-265 vote June 8 an agreement that would have cut pay by 8.4 percent.

Guild leaders declined to make a recommendation on that agreement, but have recommended that members approve the revised agreement.

Arthur Sulzberger Jr., chairman of The New York Times Co., which owns the Globe, said in a June 25 memo to employees that there would be more cost reductions even after the new agreement.

The new proposal was tentatively agreed to by both sides June 23. That ends for the time being a three-month struggle between the company and the Guild, which represents editorial, advertising and business office employees.

The New York Times Co. threatened in April to close the Globe if its union didn’t agree to $20 million in concessions. Other unions at the Globe have agreed to $10 million worth of concessions, but the Guild balked by a close vote. The Times responded by imposing a 23 percent pay cut on Guild employees as an alternative way of achieving the $10 million in savings.

The new concessions agreement still calls for a pension freeze, an end to lifetime job guarantees for about 170 longtime Guild employees, and five-day unpaid furlough. The furlough would bring the pay cut to about 8 percent; it was about 10 percent under the rejected proposal, the Globe reported.

Globe reporters make $40,000 to a little more $70,000 a year, the Globe reported.

If the agreement is approved, the company would pay most of the difference between the 23 percent pay cut it has imposed and the pay cut spelled out in the agreement, the Globe reported. It said that cost would be recovered by the company’s making a one-time cut in its health-care contributions, which could mean higher payments for Guild members.

“Our aim throughout our negotiations has been to achieve the necessary savings in a way that causes the least hardship for our employees. We’re very pleased to have reached an agreement that accomplishes those goals,” the Globe’s publisher, P. Steven Ainsley, said in a statement.

Beth Daley, a Globe reporter and Guild representative who voted no on the original proposal and told the Globe June 23 she hadn’t made up her mind on the revised agreement, also said in the Globe: “Although I can’t speak for everyone, I think this deal will pass. Everyone wants this over. I remain incensed at management for the punitive nature of their deal, but I hope this will signal to potential buyers that the union is willing to make sacrifices to position the paper to face the challenges ahead and continue informing the public.’’
Published reports have said the Times has put the Globe up for sale, and that three or more Boston-area investors might be interested.

Daniel Totten, Guild president, told the Globe: “It’s been an exhausting process and a very difficult process for the members.”

Bernard J. Lunzer, president of The Newspaper Guild, based in Washington, D.C., and parent union of the Boston Newspaper Guild, attended part of the talks between the company and the local union in mid-June. Lunzer recently told Editor & Publisher that “mistakes were made” in negotiations between the Boston Newspaper Guild and the Globe that led to the Boston Newspaper Guild’s rejection of the concessions.

Seven unions have ratified concessions totaling another $10 million. They represent engravers, truck drivers, technical service workers, paper handlers, pressmen, electricians and mailers.

Besides the Guild, only the machinists’ union, representing fewer than 30 workers, rejected concessions. A company spokesman told the Globe that that vote would not affect the $20 million in cost savings requested by the Times Co.
 
The Globe has reported that the newspaper lost $50 million last year and was forecast to lose $85 million this year, which prompted the Times Co. to say it would close the 137-year-old Globe if the $20 million in concessions were not achieved.

POSTED 6/24/09

Guild members wary of new concessions,
but predict that they’ll be approved

Members of The Boston Globe’s largest union, the Boston Newspaper Guild, have expressed unhappiness with a new agreement on concessions between the Globe and the Guild, but most of them expect the new proposal to be accepted, the Globe reported June 25.

With a 23 percent pay cut currently affecting their paychecks, many Guild members say they are willing to take what they can get, according to the Globe.

The union is set to vote on the new proposal July 20.

“This contract proposal is unquestionably a better deal than the one we rejected on June 8,” Scott Allen, a Globe reporter who voted against the first agreement, told the Globe. “Unless I hear something radically different, I’m voting ‘yes,’ but not enthusiastically.”

The new proposal cuts pay 5.94 percent, rather than the 8.3 percent in the original concessions agreement, and trims other benefits, such as health insurance for retirees in the future and vacation pay, to allow for the lower pay cut. If the new proposal were to be approved by Guild members, they would also receive about two-thirds of the difference between the new pay cut percentage and the 23 percent cut they will have taken for the time between the votes, the Globe reported. The money to pay back that amount of the difference in pay would come from a one-time reduction of the Globe’s contribution to employees' health care, which might mean higher payments for employees, according to the Globe.

Some parts of the new proposal are the same as the original concessions the Guild rejected, such as five-day unpaid furloughs for each Guild member, a freeze on their pensions, and the loss of lifetime job guarantees for 170 Guild members.

“I’m very disappointed,” Karen Mussari, finance department employee, told the Globe. “This is worse than the first one. I can’t in good conscience vote for it.”

Michael Paulson, a Globe reporter, told the Globe: “It’s a tough pill to swallow, but one that’s necessary. This is the best we could do in a tough situation.”

Daniel Totten, the Guild’s president, echoed that sentiment.

“This is not a deal that is going to please everybody, but we tried to do the best we could for the members as a whole,” Totten told the Globe.

Union leaders held a meeting June 23 to brief Guild members on details of pay and benefits cuts in the deal. Fewer than 100 of the nearly 700 members attended the meeting.

Many of the members present were upset that the new deal did not save them more than the original one, especially for families with health care, who would see $1,000 a year worth of increases in expenses, the Globe reported.

The original concession agreement between the Guild and the Globe was voted down 277-265 by Guild members June 8. Some members said the pay cut was too steep, according to the Globe.

The New York Times Co., the Globe’s parent, had demanded $20 million in concessions from the Globe’s unions, and threatened to shut the Globe down if the concessions weren’t made. It has been reported that the Globe lost $50 million last year and is on track to lose $85 million this year.

Each of the Globe’s other unions approved concessions totaling $10 million, but the Guild did not ratify its $10 million portion of the overall concessions. A 23 percent pay cut was invoked instead by the Times Co. as an alternative after the Guild rejected its proposed concessions.

This report was written from published reports by Jen Slothower, a graduate student at the Northeastern University School of Journalism and a news staff coordinator for the Bulletin.

POSTED 7/2/09

2 bids total expected
2 prospective bidders to submit
combined bid for Boston Globe

The reported prospective bidders for The Boston Globe -- Stephen Pagliuca, co-owner of the Boston Celtics and a private equity executive, and Jack Connors, co-founder of a major Boston advertising company and chairman of Partners HealthCare – have teamed up to submit a combined bid, according to the Globe.

The Globe reported July 3 that Pagliuca and Connors had received permission from the Globe’s parent company, The New York Times Co., to present a combined bid. Bidders had been forbidden by nondisclosure agreements from collaborating, but Pagliuca and Connors asked for and received the Times Co.’s approval to do so, the Globe said.

Preliminary, nonbinding bids originally were due July 8, but the Times Co. postponed that deadline to give potential bidders more time to prepare their proposals, and hasn't set another deadline.

The other reported bidder is Stephen Taylor, a former Globe executive and member of the family that sold the Globe to the Times Co. in 1993. Taylor reportedly would bid as head of a team of investors.

A June 15 report in The New York Times quoted a number of media experts on the estimated market value of the Globe that gave a range of “everything from $250 million to ‘we pay you to take this off our hands’.”

The Times Co. bought the Globe for a record $1.1 billion in 1993. The Globe reported that the newspaper lost $50 million last year, and is forecast to lose $85 million this year. The Times threatened in April to close the Globe if its union did not agree to $20 million in concessions. A ratification vote on the last of the $20 million in concessions is scheduled for July 20.

“(Accepting bids) doesn’t mean they have said they are going to sell it. They’ve just said that they are willing to entertain bids. But it sure indicates an interest,” one potential bidder told the Globe.

That same potential bidder told the Globe that bids would be taken on “any and all” New England properties. Besides the Globe and a stake in the Boston Red Sox, the Times Co. owns the Telegram & Gazette of Worcester, Mass., and Boston.com, the Globe’s Web site.

The Times Co. wants to sell the Telegram & Gazette and The Boston Globe as a package, the Globe reported.

On June 10, the Globe reported that the Times Co. had hired an investment bank, Goldman Sachs, to manage the possible sale of its New England Media Group properties.

In a confidential letter from investment bankers at Goldman Sachs obtained by The New York Times, the Times Co. set the original deadline of July 8 for initial, non-binding bids, the Times reported June 27.

The Globe reported July 3 that a buyer would have to assume $59 million in pension liabilities — $51 million for the Globe and $8 million for the Telegram & Gazette. That was well below the estimated underfunded pension liability for the Globe alone of $200 million, the Globe reported. It said the reduced assumption of liability was presented to bidders because the pension liability is seen as an impediment to a sale.

All three men reported as potential bidders have declined to comment to the Globe about any interest in buying the 137-year-old newspaper.

“Like a lot of other readers and concerned citizens of Boston, I have high hopes for the future of the Globe,” Taylor told the Globe. “I wish them well and have no comment on a possible acquisition.”

Taylor is a cousin of past Globe publishers and was executive vice president of the paper and president of the Globe’s electronic publishing arm when the Taylor family sold the Globe to the Times Co. in 1993.

Connors has been interested in the Globe before, reportedly making that interest known in 2006.

The June 10 Globe story said Goldman Sachs is the same investment bank that the Times Co. hired to sell its 17.5 percent stake in the Red Sox.

The Times Co. has declined to comment in recent months on whether it would sell the Globe.

According to the Globe, the Sulzberger family, which controls the Times Co., has indicated to potential bidders that they would prefer a buyer that wants to operate the Globe as a journalism outlet, but they will face pressure from shareholders to obtain the best possible price.

Sources involved in the bidding told the Globe that some possible bidders might be looking to acquire the Globe for its real estate assets or might want to split the company into parts: real estate, newspaper, and online site.

Some of the potential bidders are reportedly interested in buying the Times Co.’s 17.5 percent stake in the Red Sox, which the company purchased in 2002 for $75 million.

Baseball investors told the Globe that the stake could be worth about double that now.

The Globe reported that an investment in the Red Sox would have to be valued separately from the Globe and would have to be approved by Major League Baseball.

The sale of the Red Sox stake could also be heavily influenced by team owner John Henry, the Globe reported.
Henry himself has been reported to be a potential bidder on the Globe, but the Globe reported that Henry said on Twitter in June: “I’m not buying a newspaper.”

Executives from the Times Co. and the Globe declined to comment to the Globe.

“It’s our longstanding policy not to comment on rumors concerning potential acquisitions and divestitures,” Catherine Mathis, Times Co. spokeswoman, told the Globe.

Tom Fiedler, former executive editor of the Miami Herald and dean of Boston University’s College of Communication, told the Globe: “The Boston Globe franchise — the brand of Boston Globe journalism — is extremely valuable.

“Right now, it just has to find the business model to sustain it,” Fiedler said.

This report was written from published reports by Jennifer Skala, a graduate student at the Northeastern University School of Journalism and a news staff coordinator for the Bulletin.

POSTED 7/9/09