The current contract, which I believe has been extended several times, expired at midnight Friday. Gannett refused to extend it further, the newsletter says.
Broader impact unclear
The Detroit talks come as GCI continues to struggle with falling revenue across its newspaper markets, according to the just-released third-quarter financial report. Still, it's unclear what management's demands in Detroit might portend for similar wage and benefit cuts at GCI's more than 80 other U.S. daily newspapers.
Indeed, Detroit is a unique situation: Its economy is unusually grim following the auto industry's near meltdown during the Great Recession. Last year, the Freep and News reduced home delivery to just three days a week in a bid to reduce costs. Management's request for more savings may simply indicate that Detroit's financial health has worsened -- a slide that the unions may learn more about soon.
The 12% pay cut would save the company $5.2 million annually, the company told union negotiators, according to the newsletter. The changes in medical coverage -- which would basically mean union members would get the same benefits as non-union employees -- would save an additional $700,000 a year. "In total,'' the newsletter says, "the company is demanding over $6 million per year and $18 million over the life of a three-year collective bargaining agreement."
DMP to open books
Money saved from the 12% pay cut alone indicates the payroll covered by the contract totals about $43.3 million annually.
[Updated at 3:20 p.m. ET: In a fresh post on his blog, Bill Shea of Crain's Detroit Business says the contracts cover about 1,400 employees. He also notes that management has previously acknowledged that the two newspapers are losing millions of dollars, even after last year's retrenchment.]
The DMP has agreed to open its books to an economist for the International Brotherhood of Teamsters, a step apparently designed to help management make its case for concessions. "The company offered to provide financial information on a 'confidential' basis, meaning that union officers and advisors could have access to the information,'' the newsletter says.
Two more bargaining sessions are scheduled for Oct. 26 and 27. The unions have set an Oct. 31 vote by members on whatever offer is on the table at that point, the newsletter says.
[Image: today's Freep, Newseum]
I wonder if corporate has strike insurance on the Detroit papers. If so, it might be willing to take a strike in what used to be a union-dominated town.
ReplyDeleteWow. Hope someone is there to report it when they open those books.
ReplyDeleteContract offer vote is on Halloween . . . as in trick or treat?
ReplyDeleteEven Kurt Luedtke wouldn't come up with that plot twist.
Dubow's bonuses and stock options generally amount to more than $6 million per year. I would guess he would fare better losing that money than 1,400 Detroit workers would losing 12% of the pay.
ReplyDeleteHe should be a man and take one for the team. After all, this is supposed to be hard on all of us, right? Come on, Craig. Show us that you mean what you say.
Detroit has always been a union city. Detroit is the most economically depressed metro city in America. Companies have left in droves. Coincidence.... I think not. Unions have destroyed the economy of a once great city.
ReplyDelete6:49 -- That's certainly what big business wants you to think. Could it have had anything to do with the fact that foreign auto makers have -- for years been making better quality cars? Could it have anything to do with the fact that GM put all of its eggs in the SUV basket then found itself surprised by the fact that people wanted cars that get better gas mileage? Could it have anything to do with the fact that the CEOs who pushed those SUVs accepted compensation in the realm of $25 million per year for years? Could it have anything to do with the fact that Detroit's entire economy was based on one primary industry?
ReplyDeleteUnions might not have helped Detroit, but they didn't kill it. The big automakers were still able to produce cars that they could sell at a competitive price point. The trouble was the cars were -- for the most part -- low quality and most Americans didn't want them.
During the past four decades, the more profitable American companies have become, the less (on average) they have paid their employees. And -- unless you are a highly placed executive -- that's bad news for you as well as me. This blind hatred of unions is just foolish. They have their problems but they are also one of the few protections that American workers (those fortunate enough to belong) have left.
6:49 -- It's arguable that Las Vegas is even more economically depressed than Detroit right now. Unemployment is higher, housing prices have been crushed, etc., etc. And Las Vegas is in a right to work state that heavily favors business owners in all regards. Your argument doesn't wash unless you're willing to argue that it's bad news if you tip the scales too far either way.
ReplyDeleteVegas is totally unionized so you've made my point. Unions killed Detroit plin and simple. Your blind sustain for business is apparent. Name a heavily unionized company and you will have named a failing company. There was a time and a place but it was a long time ago. Anyone who disagrees with a union sympathizer is always a bad guy!
ReplyDeleteI cannot believe that Unions are the cause for the demise of any of the companies. In most cases is it not the greed of the top owners/managers? They simply want to use the cheapest labor. Is this anti-union thread one that dislikes organized labor because of the Unions themselves? Or do the posters believe that workers should not negotiate a contract? I believe the top Gannett managers (Mr. Dubow and company) negotiate/ work under a contact. They do it with an attorney rather than collectively at the table. Right?
ReplyDelete11:21 -- Name the industries in Vegas that are heavily unionized. Construction? Casinos? There are unions in Vegas, but it is a HUGE mistake to call it heavily unionized. You're just wrong.
ReplyDelete