News rejects Guild contract proposal

The Executive Committee of The Buffalo Newspaper Guild last week gave The Buffalo News a contract proposal in advance of negotiations.

The proposal called for a two-year contract extension of the current collective bargaining agreement, a modest salary increase and/or lump sums, and an extension of The News’ current health insurance obligation.

In addition, the Guild offered to explore opportunities for savings from a redesign of health insurance benefits and to work cooperatively with The News to fashion separation agreements that might be more attractive to newsroom employees with 40 or more years of service.

News management earlier this week rejected the proposal.

The Guild bargaining team offered the following reasons to The News for its contract-extension proposal:

* The newspaper industry: Guild leaders believe that all employees and managers should focus on improving the products and services the paper offers, and avoid the potential for a labor dispute during this difficult time.

* The newsroom: This is a critical period for the company and the union, with changes in key positions, including a new managing editor, and a difficult effort under way to create a universal reporting pool. Guild members would prefer to focus on the future of the newspaper, not prepare for a contract fight.

* The News’ professional identity: By forcing employees to pay a financially devastating amount for health insurance, The News will make the newspaper an undesirable place for talented employees, further eroding the paper’s quality and personality, as well as advertisers’ confidence in the product.

* Fairness: If a clause in our contract related to health insurance takes hold, Guild employees will be forced to pay ever-higher amounts for health insurance. Before the end of the decade, Guild employees will likely spend more on health insurance than they take home in pay.

Under this clause, the company will no longer be required to pay the full cost of health insurance after Dec. 31, 2011, unless The Guild and The News negotiate an alternative agreement. Without an alternative agreement, the company’s health insurance obligation after Dec. 31, 2011, is to provide only enough money to pay the cost of the current 2011 health plan plus 5 percent annual increases.

Take notice. The 5 percent clause is the end of life as you know it.

Without a change in that clause, the amount of money Guild employees pay toward health insurance would increase every year, reaching thousands of dollars and, based on current insurance trends, potentially tens of thousands of dollars by the end of this decade.

ABC and Customer Service employees could see their pay, after health insurance costs are deducted, fall by mid-decade to poverty levels, as defined by the federal government. By the end of the decade, reporters will likely pay more for insurance than they take home in pay.

“Every Guild member needs to understand the magnitude of the threat to their standard of living,” said Guild President Henry Davis.

In its rejection of the Guild’s contract extension proposal, News management said that it welcomed The Guild’s underlying appreciation of the newspaper’s financial difficulties but that the proposal failed to meet the current economic realities of the business. The News offered to explore a redesign of the health plan, but warned that the savings must be equal to or greater than what it would achieve with the 5 percent clause.

In its response to the proposal, News management also identified two of its main objectives of contract negotiations: reduce expenses and provide for greater flexibility in the use of employees and non-employees, particularly in the newsroom.

“The economic uncertainties of The Buffalo News when viewed in conjunction with our inability to generate the revenue needed to sustain our current business model demands that management reduce the expenses of operating the business,” Dan Farberman, vice president of human resources, wrote in a letter to The Guild.

The next step is face-to-face contract bargaining. Earlier this year, The News postponed contract negotiations until after the first financial quarter. The Guild is in the process of scheduling dates with News management, and is hopeful sessions will begin in mid-May.