Company mandates 5% pay cut
NEW YORK — In the face of rapidly declining subscription and advertising revenues and a series of fiscal missteps, the New York Times Co. will lay off 100 workers from the business side of the org and has mandated a 5% pay cut for all of its employees.
Meanwhile, the Washington Post is offering a new round of buyouts to newsroom, production and circulation employees, and said it could not rule out layoffs, according to wire reports.
The Times eliminated 100 of its 1,300 newsroom workers in February 2008 through buyouts and eliminated positions, but these are the company’s first mandatory cutbacks in recent memory.
In exchange for the wage cuts, employees will receive 10 additional days of vacation. Management has asked the paper’s unionized employees to accept the proposal unilaterally; the cuts are mandated for non-union employees.
The New York Times Co. owns the New York Times Media Group, the New England Media Group (which includes the Boston Globe) and the Regional Media Group, which includes 14 dailies primarily in the South. Employees at the New York Times Co.’s smaller holdings, including About.com, will be asked to take 2.5% pay cuts and five extra days of vacation.
The Times has been criticized, both externally and internally, for its decision to buy back $2.7 billion of its own stock — a stock that traditionally sold well and cost the Times more than three times its then-current market capitalization. The subsequent scramble for liquidity included a loan of $250 million from Mexican billionaire Carlos Slim at 14% interest and a mortgage on its new headquarters for $225 million. The Times has continued to sell assets, including its corporate jet.
Still, the Times disclosed in its annual meeting proxy two weeks ago that, after announcing a salary freeze, it approved “one-time discretionary bonuses” for its top execs separate from their annual performance bonuses.
The Post has offered buyouts on several occasions in the past few years. More than 100 editorial staffers left the newsroom last May.
The Post has about 700 editorial staffers and about 100 at its digital operation. The company is not offering the buyouts to staffers on the digital side.
The first wave of Post workers taking the buyouts would leave in July, Publisher Katharine Weymouth told Reuters.
“While online revenues have been growing, they have not yet grown fast enough to offset the declines we are seeing in print revenues,” Weymouth wrote to employees.
The news comes a day after the company disclosed to shareholders in a letter that the Post and Newsweek magazine lost money in 2008 and that the Post will lose money in 2009.
Post shares rose $6.93 to close at $384.28 on the New York Stock Exchange afternoon trading. Times shares rose 41¢ to close at $4.98.