April 18, 2012 · 0 Comments
(Steven Greenhouse, The Times’s longtime labor reporter, recently emailed his take on the state of Guild-Times contract negotiations to several colleagues, some of whom had asked him to weigh in on the issue. Greenhouse holds no union position and is not a member of the bargaining committee or any other Guild committee. We thought his report was a clear, thoughtful, down-the-middle account of where things stand and what’s at stake in these very important talks. So, with Steven’s permission, we’re making it available to all Times Guild members. – The Newspaper Guild of New York)
Several colleagues have told me that they’re confused about where things stand in the Guild negotiations, and they’ve asked me to attempt to explain things and bring them up to date. A few colleagues have also told me — to my surprise — that various editors strongly believe that management’s new offer is very good and much improved and that we Guild members should be rushing to accept it.
So I’d like to attempt to explain the state of play.
Sad to say, the Guild and the Times still remain very far apart. The Guild contract expired on March 31, 2011, and there was hardly any movement in the negotiations in the subsequent 11 months. During those 11 months, management stuck to its initial contract offer, which demanded very significant concessions, most notably a pension freeze and a three-year salary freeze. That offer would have meant a cut of more than 15 percent in compensation for every one of us over the life of the proposed three-year contract, after factoring in inflation.
(Quick math: That proposed wage freeze would have cut our pay by 7.7 percent after inflation over three years, assuming an annual inflation rate of 2.5 percent. And the proposed pension freeze would mean an additional 10 percent or so reduction in our compensation because, under a freeze, the Times would stop paying an amount equal to around 10 percent of our salaries into the pension fund each year (not including the large special contributions the Times has also had to make because of underfunding troubles in our pension plan.))
Any expert in labor relations would tell you that when a company demands a cut of more than 15 percent in compensation after inflation, it’s being draconian. From what I’ve seen over the years cover workplace issues, companies seek to exact such deep cuts in compensation only when they’re in dire financial shape or when management is angry at the workforce for doing a sub-par job and not keeping up with the competition.
Not surprisingly, the Guild responded to management’s initial proposal with an emphatic, “No way.” On March 26, nearly a year after the Guild’s contract expired, management made its second offer. In my view, management finally put forward its somewhat improved offer because it saw how angry, offended and united Guild members were and because Arthur was taking a public relations beating for a contract offer that seemed to insult and punish the newsroom. (I think Arthur has been ill served by Terry Hayes and his other negotiators, but more on that later.)
As someone who has covered labor negotiations for years, I was baffled why it took nearly a year for management to move beyond its initial draconian offer. And I was also totally baffled by this line in Terry Hayes’s March 26 letter about the company’s new offer: “To say we are disappointed in the lack of progress since (the contract expired) only begins to scratch the surface of it.” If Terry Hayes was so disappointed about the lack of progress, he could have easily assured significant progress by not digging in for nearly a year with an offer that demanded such huge concessions.
Now a look at the main points in the company’s March 26 offer:
Pension–Whereas management’s original offer, with its call for a pension freeze, provided for no increase at all in the company’s contribution to our 401(k) plans, its new offer proposes an additional 5 percent contribution to the 401(k)’s of those of us at the Times 10 years or more and a 3 percent contribution for those at the Times fewer than 10 years. (Some more boring math: For those with 10 years or more at the Times, this would mean the company would contribute about 5 percent less of our pay per year toward our retirement than it does now, and for those with fewer than 10 years, the company would contribute about 7 percent less.)
Salary–Management’s new offer dropped its call for a three-year pay freeze and instead calls for a wage freeze in the contract’s first year, a 1 percent raise in the second year and a lump-sum payment equal to 1 percent of salary in the third year. In other words, the offer calls for a mere 1 percent raise over three years. (Again, assuming inflation of 2.5 percent a year, this new proposal would translate into a 6.7 percent cut in our pay over the life of the contract, after factoring in inflation. If inflation were to rise to 3 percent a year, this could mean an after-inflation pay cut of roughly 8 percent over three years.)
For those who think management’s new offer is a major improvement over its initial offer, I suggest looking at it this way. While the company’s first proposal demanded an effective cut in our compensation of more than 15 percent after inflation, management’s new proposal would in effect mean a cut of 10 or 11 percent in our compensation after inflation. In my view that still seems plenty draconian and punitive.
Workweek–Management has largely abandoned its proposal for a 40-hour workweek and has instead agreed to continue with our 35-hour work week. From one perspective, this appears to be a substantial concession on management’s part, but many of us in the newsroom see this quite differently. Considering that so many of us work 50 hours or more a week without putting in for overtime, it seems largely insignificant for management to say, okay, we’ll let you stick with a 35-hour week and stop demanding a 40-hour week. To many of us in the newsroom, this hardly seems like a concession at all.
Health Plan–In its original offer, the Times called for ending the Guild’s health plan and moving us into management’s plan. In truth, I’m not sure which plan is better or more generous. Some Guild members have made cogent arguments that management’s plan is better, especially with regard to use of out-of-network services (but managers generally have higher salaries than Guild members, making it easier for them to afford out-of-network services). But other Guild members have made strong arguments that the Guild plan is better because it has a solid, low-cost HMO plan and because the union, i.e., we Guild members, have a major voice in shaping the plan and its benefits.
When I discussed all this with some of the newsroom’s top experts on health care, they said the debate over which plan is better — management’s or the Guild’s — totally misses the real issue. The real issue, they said, is that the Times contributes far less toward employee health coverage than do most major corporations. The Times contributes an amount equal to 6 percent of our pay toward our health coverage, while the average for large American corporations is around 12 percent.
According to the Kaiser Family Foundation, the typical worker at a large company pays 24 percent of his or her total health premiums, with the company paying 76 percent. But we at the Times pay 46 percent of our total health premiums — nearly double the nationwide employee average — while the Times pays just 54 percent. The average annual total health premium per worker at a large American company is $15,520, with the average worker paying $3,755 of that. Because we in the Guild shoulder 46 percent of our health premiums, we each pay about $3,500 more on average per year toward our health coverage than employees at other large corporations.
In the past, the old Guild leadership, and the Times, did a poor job keeping us abreast of the financial problems that the Guild’s health plan faced, and some Guild members blame the Guild leadership for those financial troubles. But many Guild members say the real reason for those financial problems is that the Times has been so stingy in contributing toward our health plan. In its new proposal, management has offered just a $200,000 increase in its contribution toward the Guild’s health plan — an increase so small that it would most likely mean serious financial woes for the Guild’s plan in just a year or two. In its new contract offer, the Guild has proposed — in the hope of finally fixing our plan’s financial problems — that the Times increase its contribution in several steps over several years so that it would ultimately contribute an amount equal to 12 percent of our pay toward the Guild’s health plan. That would mean the Times would contribute about $6 million more each year toward the Guild’s health plan, and that should go far to assure the plan’s long-term financial health.
I often wonder why the Times dragged its feet for nearly a year before it finally put forward its second offer. Sometimes I think that Terry Hayes and the Times other negotiations hoped that the delays and lack of progress in the bargaining would break our spirit and cause us to fight among ourselves. But Guild members have held together and, with each passing month, Guild members have grown angrier, more frustrated and more united.
Guild members remain very unhappy with management’s latest offer. When I’ve seen other companies demand pension freezes in their labor negotiations, those companies often accompanied that bitter pill with an important sweetener –like a significant raise or a fat increase in 401(k) contributions. It was mystifying to me that the Times negotiating team pushed the Guild for almost a year to accept two hugely bitter pills at once: the pension freeze and a three-year-wage freeze (not to mention the proposal to increase our workweek to 40 hours from 35 without any concomitant increase in pay). I’ve heard numerous colleagues say that as a result of management’s hardline negotiating stance, the newsroom seems angrier, the gap between the newsroom and upper management greater, than at any time in decades.
I have great respect for Arthur and the entire Sulzberger family for their whole-hearted dedication to maintaining the Times as the world’s greatest newspaper. But I fear that the Arthur has been ill served by Terry Hayes and other negotiators who, through their draconian contract offers, have shown considerable disrespect toward the newsroom, all when we Guild members are working harder than ever before on more platforms than ever before — newspaper, Website, blogs, video, Facebook, Twitter, radio and TV interviews — to help ensure that the Times continues to produce the world’s finest news report, day in and day out. The Times negotiating team has created considerable anger and resentment in the newsroom, and I for one am sorry to see so much of that anger and resentment directed at Arthur.
For years, we in the newsroom have been eager and willing to work with management to ensure the paper’s financial health and to make the Times the best news operation it can be. Just look at how willingly we accepted the 5 percent pay cut during the depths of the recent recession. We certainly understand that the Times has financial problems, although we see that the digital paywall has attracted more than 450,000 subscribers and that some analysts are saying the paywall might soon bring in $100 million a year. We also saw that the Times quickly found the money to pay Janet Robinson a severance package of more than $23 million.
Many of us Guild members have the sinking feeling that the Times bargaining team has abandoned any serious effort to work with us and is instead seeking to cram down its hugely concessionary offer by trying to wait us out and break our will — all while applying a lot of lipstick to their pig of a contract offer.
I personally believe that the Times negotiating team can be a lot less inflexible and a lot more creative in its bargaining offers and its strategy. As I have said before, I believe the Times should work with the Guild to seriously explore some type of profit-sharing formula that would help hold down the Times’ fixed costs while at the same time assuring that Times employees receive a fair share of any financial rebound that the Times enjoys. A smart profit-sharing formula could be an important win-win for both sides, and such a strategy could play an important role in helping the Times restore its dividend to shareholders.
I fear that the anger in the newsroom will only continue to grow so long as the Times negotiating team sticks with contract offers that would cut our after-inflation compensation. More than a year has passed since our contract expired, and many of us are still waiting for the Times to put a halfway realistic offer on the table, one that shows that management appreciates the Times’ 1,100 Guild members for the amazing work we do, day after day, 24/7, producing the world’s greatest newspaper and news Website.
Please feel free to share this with others in the newsroom.