May 24–31, 2001

media

Process of Elimination

PNI and a union dicker over the terms of downsizing.

by Frank Lewis

It must be hard to glance around the Inquirer and Daily News newsrooms right now without thinking that in a few months, maybe a few weeks, a lot of your colleagues won’t be there anymore.

Such is life in big-city daily newspapers (small-city papers, too) in the early days of the 21st century, when revenues are high but not high enough. As Miami Herald columnist Dave Barry recently put it: "Here at the newspaper, we get hourly phone calls from Wall Street. ‘Send more profits!’ Wall Street shouts, then slams down the receiver. We must comply, because otherwise Wall Street would shut down the newspaper, and we would starve to death, because, as English majors, we have no useful skills."

Like most newspaper companies, Philadelphia Newspapers Inc. is complying with its own calls from Wall Street by downsizing. At press time PNI executives and officers from the Newspaper Guild, the union that represents Inky and Daily News editorial staffers and some other employees, were still hammering out the particulars, but the company is considering three degrees of separation: buyouts, job eliminations and layoffs.

According to Inquirer staff writer and Guild local president Henry Holcomb, the first wave of staff reductions will come through buyouts and early retirement packages. Like last year’s round of buyouts, the company has the right to reject applications. Positions vacated through buyouts will not be refilled.

Unlike last year, however, staffers with as little as two years of service will be eligible for the buyout. Those with two to 12 years will receive a lump-sum payment according to a sliding scale that tops out at $20,000; those with 13 or more years of service will receive two weeks’ salary for every year at PNI, up to 52 weeks. All of those taking a buyout or early retirement will remain eligible for benefits for varying periods. (These offers are already on the table to non-union employees).

But that won’t be the end of it.

"My strong desire," publisher Bob Hall wrote in a May 8 memo, "is to achieve most of the necessary reductions from this approach as we have in the past but some job eliminations will be necessary. If the results from the buyouts and job eliminations fall short, layoffs will then be considered."

The L-word has been bandied about at PNI a great deal in recent months, and among the rank and file, there seems to be widespread consensus that the Guild contract makes laying off Guild members almost impossible. The company would have to open the books, and that’s the last thing it wants to do when trying to downsize during a period in which profits remain relatively high.

Or so the story goes. But management sources have said privately that this is not the case. Hall certainly hasn’t avoided the notion in memos, and Holcomb won’t rule it out.

"There’s very little chance [of layoffs] right now," he says. "To my knowledge, it’s never happened. To say it’s impossible — I’m not going to go that far."

PNI’s owner, Knight Ridder, has argued that if profits dip too much from the dizzying heights they’ve reached in recent years, the company’s stock price will drop and a takeover could ensue. Outside of Knight Ridder’s headquarters, however, it’s not clear how many people find CEO Tony Ridder’s concerns valid. "Wise people disagree on whether that’s true," Holcomb says. Asked whether the Guild will make an issue of profit margins when and if layoffs begin, he says, "Of course. We think we have a public trust responsibility, which the Guild wants to keep pressure on the company to uphold."

Holcomb and other sources have said PNI wants to reduce its total workforce by about 200. How that will affect the newsrooms is not clear. "If there are departmental [staff-reduction] goals, they haven’t disclosed what those are," Holcomb says.

Still, various sources have said that the mood in both newsrooms is dark and getting darker.

In one of his recent memos, Holcomb wrote that the Guild was "investigating reports of situations where the company appears to be making an illegal effort to intimidate a few of our members into taking the pending buyout." He declined to go into detail in an interview, but he indicated that a few staffers may have been reassigned, or threatened with reassignment, in an effort to make them unhappy enough to leave.

And on Tuesday, a Daily News veteran reported that staffers had been encouraged to wear red on Wednesday, in celebration of the recent redesign, but that many were contemplating wearing black instead, "to protest job cuts, profiteering, etc."