Newspaper union accepts givebacks ahead of sale

[May 30, 2009]  PORTLAND, Maine (AP) -- The Portland Press Herald's largest union voted overwhelmingly Friday to accept wage and benefit concessions designed to pave the way for the Seattle Times Co.'s sale of its Blethen Maine subsidiary. A union official said he expects the deal to close by mid-June.

Members of the Portland Newspaper Guild voted 161-19 in favor of a new contract that includes a 10 percent wage cut, a two-year pay freeze, a pension freeze and a two-year suspension of 401(k) contributions. In return, employees get a 15 percent stake in the company.

Bangor native Richard Connor, editor and publisher of the Times Leader in Wilkes-Barre, Pa., has been negotiating to buy the Press Herald, the Morning Sentinel in Waterville, the Kennebec Journal in Augusta and other Blethen Maine properties.

He thanked the union for its months of work "to reach what we believe will be a turning point for all three Blethen Maine newspapers."

Newspaper Guild President Tom Bell said concessions from the union - along with an unknown number of layoffs - represent members' contribution to an ownership stake. Under the deal, three union representatives will serve on the board of the company.

"The bottom line is this newspaper could've gone bankrupt. They could've shut their doors and just sold the buildings, the assets. But instead our workers have found a way to keep the company going and to keep the newspapers in business," Bell said.

Three other unions still have to vote, but the Newspaper Guild in Portland was viewed as the biggest hurdle because it's the largest of the unions.

Bell said there still are details to be worked out, but he said he believes they'll be resolved by mid-June.

Connor, in a statement, didn't commit to a specific timeline after several previous predictions fell through.

"This is an important day but there are still pending votes by three other unions, and we look forward to their decisions. We hope that in the next few weeks we can close this chapter and announce a new beginning for all three of these newspapers and their readers," he said.

Christopher Mackin, a consultant for the union, said the deal is the first in more than a decade in which a union served as a driving force behind an employee ownership plan using what he described as investment bargaining.

By having union members on the board, "people on the ground floor level are going to be involved in the decision making of the company," Bell said.

"It's amazing that we were able to do it. The newspaper industry is collapsing. No one is buying newspapers. Banks are not lending any money to newspapers. There hasn't been a bank to lend money to buy a newspaper in two years. So this is quite a remarkable story," Bell said.

[Associated Press; By DAVID SHARP]

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