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NYT Co. Imposes Paycut after Globe's 'No' Vote

By mere 12 votes, the Boston Globe's guild rejected a deal negotiated with parent New York Times Co. a month ago. Management then wasted no time in imposing a 23% paycut on all guild members, effective next week.

The New York Times Co. had threatened to shut down the Globe outright if the four major unions did not come to an agreement that would save the company $20 million. After contentious negotiations, each union reached a deal with management and all except the guild immediately ratified the pacts.

In the month leading up to the vote, the guild leadership made no secret that it came to the deal under duress and all but invited the rank-and-file to vote it down. And they did, by a vote of 277-265, rejecting a new contract that included a 10% pay cut, reduction to health and retirement benefits, including a pension freeze, and the elimination of lifetime job guarantees for about 170 veteran members.

The sides may be headed to the National Labor Relations Board (NLRB) but in the meantime, a new round of negotiations will probably commence. The union has little recourse in reversing the unilateral paycut except to file a grievance. Management, on the other hand, will not be able to concede too much to the guild lest it nullifies the deals it already has with other unions.

A fault line within the guild may be developing as well. Its negotiating team, lead by Dan Totten, fought hard to preserve the lifetime guarantee provision until the very end. On Monday night, guild members divided sharply on how they voted based on whether they have that lifetime guarantee or not.

Globe City Hall Bureau Chief Donovan Slack, who voted yes, believes the paper will lose "tons of amazingly, talented journalists" if the company imposes the 23-percent pay cut.

"It's really frustrating that it was so close," said Slack, who has been at the paper for six years. "To think that only 12 people separated what could have been the end of this nightmare, from what will now, most definitely, turn into a prolonged battle with too many casualties to even calculate right now."

Before the results were announced, Globe reporter Scott Allen said he voted no and described a "very serious" mood over on Morrissey Boulevard.

"As much as the New York Times needs the concessions, and as much as we all recognize that we have to do our part and we want to do our part, the Times did not try very hard to make the deal fair or equitable for us," said Allen, who has a lifetime job guarantee.

The other unions, including pressmen, drivers and mailroom workers who have already approved deals totaling $10 million in cuts, are not sympathetic to the guild. They see the 'No' vote as an irresponsible move that may scuttle a new contract that had been nearly in place.

And finally, the threat of shutting down the paper should the impasse drag on is very real, according to Wachovia Senior Analyst John Janedis:

The New York Times Co. is set to lose $85 million on an operating basis. The plant closures, reduced compensation and increased circulation revenue should help but not enough. The paper is on track to lose a "significant amount of money this year," Janedis wrote.

"While the potential closure of the paper may be viewed by some as a negotiating tool, we think ongoing double-digit ad revenue declines and labor issues could make a hybrid print/web edition a reality, ultimately leading to significantly more job losses."