New York Times Guild Hopping Mad About 'Foundering' Charge

The continuing battle between The New York Times and the paper’s Guild over its health-benefit fund just got a lot more intense.

Quick recap: The Guild’s health benefits fund is going bankrupt—they’re expecting it to run out by the end of the year—and they’re negotiating with the paper over how it can help out. According to the paper’s assistant managing editor, William Schmdit, talks have "foundered." The Guild wasn’t one bit happy about that assessment and they squarely blame his side. (It should be noted that this has nothing to do with the 100 job cuts that we’ve been talking about over the last two weeks.).

The memos—and the drama!—follow:

Bill Schmidt’s Memo to the Newsroom

To the staff:

Some months ago, the company began negotiations with the Guild, proposing a series of trade-offs we thought would resolve several looming issues facing the newspaper and its employees. In return for putting up many millions of dollars to rescue the nearly bankrupt fund that underwrites health benefits for Guild employees and their families, we asked the Guild to work with us on a new labor contract for the digital age, one that would not only streamline decades-old work rules but ensure that our digital colleagues would have— at long last—overall wage parity with other journalists in the newsroom.

Wage parity and more efficient work rules, we told the Guild, are at the core of our vision of a fully integrated newsroom that will serve both our print and electronic readers. So is restructuring the health fund in a way that restores some cash to its depleted reserves, and replaces the existing, high-cost plan for unionized employees with one that offers the same level of benefits and premiums as the plan the company now provides for its non-Guild employees.

Regrettably, those efforts have foundered. Not only does the union remain resistant to modernizing the Linotype-age work rules that still govern most of the journalists in the newsroom, they have rejected the company’s plan to stabilize the failing fund that serves their own membership. Instead, they want the company to maintain a separate plan for Guild-represented employees, which we are certain will cost us more. Given the financial challenges facing the industry, and no end in sight to growing health care costs, we cannot understand the union’s insistence on following a separate path, one that puts the very solvency of their fund more and more at risk.

In the face of this, web reporters and editors on the digital side of the newsroom have become increasingly frustrated, complaining that their own desire for wage parity was being held hostage to negotiating inertia. So with the current contract governing the digital workers set to expire at the end of the month, Bill Keller, Jon Landman, Alan Flippen and I met with them in recent days, and agreed we needed to set a newcourse. If we cannot achieve at this point a totally integrated contract, as we desire, or reach agreement with the union on how to repair the broken health fund, we can at least ask the Guild to ensure that those journalists who are represented under the separate digital contract no longer are paid at a lower rate than others who work alongside them.

Collective bargaining is not a particularly elegant process. Proposals are made and withdrawn for tactical reasons, and most of what happens stays — properly — behind closed doors. As journalists yourself, you are right to be skeptical, whenever parties in labor disputes — for whatever reasons — spin their differences in shop papers, broadcast e-mails or press conferences.

That being said, however, we want to use this occasion to make it clear to the newsroom as a whole what the company wants from the Guild, besides pay parity for our web workers, and how we think we can get there.

First, because it is essential that we have a newsroom that serves our digital future, we will continue to press the Guild to negotiate changes in the work rules that govern all the journalists who work at The Times. Many of the work rules in the existing newspaper contract — governing such matters as shift differentials, overtime and scheduling requirements — go back many years, and are closely held by a union leadership understandably loath to surrender concessions hard won in negotiations long ago. We respect that contractual history. But we also know many of these rules are cumbersome and ill-suited to a new age that demands speed, efficiency and flexibility. In that sense, all we are asking is that the union accept — as a basis for negotiations on an integrated contract — many of the same rules they have already adopted for digital employees, in the separate digital contract.

Second, because our employees and their families must be assured the security of a working and solvent health plan, we will continue to push the Guild leadership to accept a restructured benefit plan that will assure its rank and file the exact same health benefits that I receive, along with every other member of the Masthead and all of our non-Guild employees, under the same premium schedule.

In an era of declining revenues, and especially now when we are facing the prospect of layoffs in the newsroom, the company and the union must put a premium on spending our resources as efficiently and wisely as possible, and negotiate shared solutions that not only serve our business future, but assure our employees and their families of sustainable health benefits.

William Schmidt
Assistant Managing Editor
The New York Times


February 28, 2008




The Guild has reviewed the Memo to the Staff issued by Bill Schmidt yesterday regarding the status of the talks between the Guild and The Times over ways to stabilize the Benefits Fund, which provides health insurance coverage for Guild-represented employees of The Times, NY Times Digital, and WQXR.


That Fund is overseen by four Guild Trustees and four Management Trustees.


After months of stalling negotiations, and suddenly reversing its own proposal regarding the integration of Digital into the Newspaper contract, and after ignoring Guild proposals that could have saved the company tens of millions of dollars, The Times has now issued a memo leveling false accusations against the Guild.


We feel compelled to respond with the facts in order to correct the numerous inaccuracies and distortions contained in the memo, which apparently was only sent to Guild employees in the Newsroom, not those on the business side. (We have reprinted Bill’s memo at the end of this shop paper for their review.)


The Guild has worked closely with Bill Schmidt in the past and resolved several major matters, such as the Ethical Journalism policy, and we expect to continue to work with him, and other Times representatives, in the future as the paper goes through wrenching changes in order to survive the many challenges it faces.


We can only assume that Bill – who is not directly participating in the negotiations – is receiving misinformation from Labor Relations representatives who are present.


It seems that management is attempting to place blame on the Guild for the lack of significant progress in the health care talks, and is trying to drive a wedge between Newsroom print employees and those who work for Digital. Bill goes so far as to say that the talks have "foundered."
This is quite a strange statement. As the Guild
has reported to you
previously, the talks only resumed on February 13, after a hiatus caused by The Times’ refusal to set any meeting dates since last June. At that meeting, The Times gave only a partial response to Guild counter-proposals that we made eight months ago. We agreed to continue the discussions, and have set up three meeting dates in March to do so. At the very least, Bill’s assessment that talks have "foundered" is premature.


The most shocking claim made in the Memo may be that The Times has been seeking "wage parity" for Digital employees with those at the newspaper, and that the Guild has been standing in the way of this. This is completely ludicrous! The Guild will be more than happy to agree to full parity for Digital workers, as it has been seeking since the beginning of the talks.


The Guild will agree to this whether it is part of an overall agreement regarding health benefits, or as part of separate negotiations to renew
the Digital contract, which expires at the end of March. The last
official proposal from The Times on this matter was made several months ago, and called for wage parity to be phased in over a four year period, which the Guild felt was way too long. On February 13th, management took its Digital wage parity proposal off the table completely, because it was miffed over the Guild’s resistance to lowering pay for some new employees in the Newsroom.


We agree with Bill that negotiations are normally conducted behind closed doors. But since he has made this a public issue, we find it necessary to clear the air and state the union’s position clearly in public. If you are serious, Bill, let’s sign off on immediate wage parity at the next negotiating session.


The Guild has believed that complete integration between the newspaper staff and the Digital staff is vital for the future of The Times, and we are committed to it. But it is completely unfair to accuse the Guild of
slowing down that process. It was The Times, not the Guild that refused
to meet for eight months! It was The Times that took its proposal for an integrated contract off the table…not the Guild.




The Times is trying to portray its proposals as merely "modernizing" and "streamlining" several outdated provisions of the Guild contract. Let’s examine a few of the company’s demands:


· Management wants to pay overtime ONLY after you work 40 hours in a
week, instead of the current 34.5 (day side) or 35 hours (night side).
This is nothing more than a large pay cut for anyone who regularly works overtime, and there are MANY who do. It has nothing to do with "efficiency."


· The company wants to reduce the advance posting of work schedules
from two weeks to one, and to cut the penalty for late schedule changes to just $10 if you don’t get 24 hours notice. While this would obviously make managers lives easier and save a little bit of money, it would also
wreak havoc with members’ lives. What if you have child care issues?
How can you schedule classes to improve your value to the company if your schedule can be changed at the drop of a hat? This is a very strange proposal for a company that has worked hard to portray itself as a "family
friendly" place to work. The Times will no doubt point out that the Guild
agreed to this system at Digital. Yes, we did…way back in 1995 in the first Digital contract, when the operation was just starting up and the company was worried that it would not have long-term viability. (Boy, have times changed on that score!)


Some of you may have read a report prepared several months ago by Larry Ingrassia and Lawrie Mifflin updating the staff on progress on Digital
integration projects in the Newsroom. Strikingly, that report made no
mention of any obstacles in the Guild contract to the success of the integration. Not one!


In fact, the big problem they cited was the high turnover rate among Digital employees. We know that the turnover problem was caused by Digital employees leaving to seek higher paying jobs at employers willing to pay for their skills.


The Guild has been asking the company to provide an estimate of the savings that would be achieved if the Guild agreed to all of the proposed
changes to "streamline" the contract. But The Times has failed to
provide that for more than a year.




Now let’s turn to the status of the Guild-Times Benefits Fund, which Bill has referred to as "nearly bankrupt." We certainly agree that the Fund needs an infusion of cash…that’s been the driving force behind the talks
since they began. At that time, the company stated that it recognized the
problems facing the Fund and would work cooperatively with the Guild to help solve them. Remember, management jointly oversees the Fund, not just the Guild.


The Fund is not about to go bankrupt. In fact, the latest actuarial report has extended the time the current $4.3 million reserve would be
exhausted until at least March of next year. That being said, the
actuaries have also stated that increased funding is absolutely needed to
ensure future stability, and the sooner the better. That’s why the Guild
has been pressing for talks and is willing to strike a deal to make sure its members will continue to have good health benefits.


Bill says the company is offering the Guild enough money to provide the same level of benefits that he and other Times managers get right now, and he implies that it is unfair for the Guild members to get more than that.
What Bill fails to mention is that Guild members have sacrificed past wage increases in order to maintain their health benefits. The fact is that those wage diversions now account for almost half of the premiums for our current benefits. Bill and other managers have not had to divert any wage increases to pay for their current benefits. Bill also fails to point out that The Times makes no direct payments to provide retiree health benefits for Guild employees, while the company does pay for non-Guild retiree healthcare.


What’s more, The Times has recently enacted a "cap" on the amount it will pay for non-Guild retiree health benefits. If the Guild is forced to adopt the same plan, that could lead to the elimination of retiree health coverage for Guild employees, and the Guild would have no say in that decision. That sends a mixed message at a time when the company is encouraging people to volunteer to retire early.


Bill, if the Guild adopts the same inferior level of health benefits as non-Guild employees, it would only be fair to prospectively restore the diverted wage increases to Guild employees.


Bill also states that the Guild wants to maintain a health plan that would
be more expensive for the company. In order to assure Times management
that won’t happen…here’s a compromise:


While The Times has not made a specific proposal regarding additional funding for health benefits, it claims it will provide more money, if the Guild agrees to match the inferior benefits provided to non-Guild employees.


The Guild has a different idea. If The Times provides the exact same amount of funding it says it is willing to contribute if the Guild matches non-Guild benefits, the Trustees will find other economies to keep the Fund viable through the end of the news
paper contract in March 2011. The Guild is confident that this can be achieved, and will cost The Times not a penny more than it says it is willing to provide in the current talks.
The Guild has already said that it is willing to make changes in our benefit levels to ensure their sustainability, but we prefer to do so in accordance with the recommendations of the Health Care experts we have retained from AON.


In sum, it is clear to us that The Times is attempting to shift blame for the slow progress of the talks to the Guild, and to blame the Guild for its failure to adequately compensate Digital employees.


The Guild is keenly aware of the problems The Times is facing. We are willing to help. We are willing to address the company’s legitimate concerns.


Proof of that is the Guild’s offer to save the company tens of millions of dollars in its Pension Fund obligations. The Times has inexplicably rejected that offer, and has instead decided to reduce staff.


The Guild is also willing to agree to a company proposal to give it more latitude to invest the multi-million dollar assets in the Pension Fund.
That would allow the company to earn an estimated additional $3.5 million per year.


The Guild will work with the company to try to achieve staff reductions
through voluntary buyouts to the maximum extent possible. But
cooperation is a two-way street, in the Guild’s view, and playing the blame game is not productive.


We will keep you informed.


New York Times Guild Hopping Mad About 'Foundering' Charge