Get Me Rewrite! Boston Globe Union Rejects New York Times Pay Cut

Remember a month ago, when the New York Times (NYT) said it had reached an agreement with a holdout union at the Boston Globe, which would prevent a shutdown of the Times-owned paper?

Scratch that. Deal’s off.

The Newspaper Guild, which represents some 600 editorial employees at the Globe, narrowly rejected the agreement tonight, forcing the ball back into the Times’ court. The Times had said it would need to shutter the Globe if it couldn’t extract $20 million in savings from the Globe’s unions. And, the Guild was supposed to provide $10 million of that via the proposed deal, which included an 8.4 percent pay cut. The Globe’s management had previously said it would cut pay 23 percent if the union rejected the deal.

The Times, which paid $1.1 billion for the Globe in 1993 (a year before the Netscape Mosaic Web browser launched) has argued that it needs to hack out big savings from the paper because it’s on track to lost $85 million this year.

But this interesting take by Poynter Media analyst Rick Edmonds argues that that figure overstates the case, since that total includes one-time charges, and paper losses for depreciation, etc.

Statement from Globe management:

We are disappointed that in a close vote of 277 to 265 the Boston Newspaper Guild did not ratify the Globe’s final proposal. As we have stated, the $10 million in cost savings from this multifaceted proposal is essential to The Boston Globe’s financial future.

This evening we have sent a letter to the Guild stating that as a result of the rejection of this proposal, we have reverted to our alternative Final Record Proposal which provides for a 23% wage reduction for all Guild members.  This will secure the $10 million in costs savings needed from the Guild and will allow the Globe to reach the targeted $20 million in savings needed from all our major unions.

Since the parties are at an impasse, the Globe will implement the wage reduction effective next week.  We have told the Guild that we are available to meet any day this week to review implementation of the pay cut.

We regret having to take this action, but have no financially viable alternative.