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Strib union rejects concessions, bankruptcy seems certain

Get ready for a Star Tribune bankruptcy filing.

The newsroom's Newspaper Guild announced today they had ended negotiations with management over concessions. The Strib's owners have said that unless all Strib unions agree to a specific list of cutbacks, they will file for bankruptcy.

Says Guild co-chair Graydon Royce, "We tried to work this out and this didn't happen. All we can do is go by what they have said, and that [bankruptcy] is what they said will happen. So we'll find out."

Strib publisher Chris Harte has backed away from previous, more subtle bankruptcy threats, but few expect that now. Management earlier set a Jan. 6 deadline for unions to agree to a deal in principle, and a Jan. 16 date for approval. At the moment, I don't know when they will file.

I'll have more in a bit [Update: more] but here's the memo Royce and co-chair David Chanen just sent to their members:

Guild members —

After several sessions with management, talks on possibly reaching a settlement to modify the contract have ended without agreement.

Management representatives said during a session last night that they saw no reason to continue the discussions and we could not disagree with them.

We will try to answer questions, the best we are able, on what this means for the future, at Friday’s 4:30 p.m. unit meeting.

And please try to attend tomorrow’s send-off for colleagues who have taken the buyout.

Graydon Royce
David Chanen

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Comments (9)

These unions must be living on a different planet.

Have they seen the recent unemployment figures? Have they lost their minds?

There is ZERO demand for newspaper writers and newspaper pressmen out there.

Have fun! Maybe you can write a blog and be viewed by hundreds of people. Wow.....for no money.

I don't get it either.

Why wouldn't these guys take what is being offered and look for another job in the meantime?

How is sitting at home on unemployment better than earning enough to keep the mortgage paid and the heat and electricity on?

The only logical explanation I have ever come to is "mob mentality", which I do not mean pejoratively, but as a viable reason otherwise reasonable people do things that are inherently destructive to themselves when in the company of others being egged on by instigators.

It's nuts.

Rick - I think labor's point, at least on the newsroom side, is that they are still creating substantial value, took a 10 percent cut in the summer, another 10 percent in buyouts, and were willing this time around to cut more. At some point, they're betting their continued worth is more than the Strib is willing to pay.

Thomas - I think Rick's point about ZERO demand for newspaper writers might answer your point about why they're not out looking for other jobs. (Some are, by the way.) There's nothing better out there.

Their bet is that they still create the most value working for the Strib, and a bankruptcy court will recognize that and penalize investors and creditors more than labor. NOT certain at all, but they're willing to take their chances given what they see as a bad management offer.

Remember, the union overwhelmingly agreed to a 10 percent cut just six months ago - they were moblike in their moderation then. It's possible they are making a rational decision that a post-restructured Strib will leave them better off, and others, more deserving of pain, worse.

Given past precedents, it's much more likely that a bankruptcy court is going to weigh the Strib's assets against it's debts and restructure the paper to give creditors the best chance to recoup their losses while keeping the paper alive.

Most likely that will mean the Strib will get out of it's current contract with the union.

That's the way it has played out NWA, Fingerhut and several other Minnesota businesses that have gone belly up.

If there is no demand for ones particular vocational skills, common sense dictates that one might look seriously at changing vocations all together.

Easy for you to say, Thomas Swift -- if that's your real name, and I doubt it is.

It's easy to talk in the abstract about how people should get a job in a new field. It's not that easy in real life.

Just look at the apparent death of the Post-Intelligencer in Seattle - I can't believe we will continue as a two newspaper town(s). Funny isn't it that the Pioneer Press has more net worth now than it's much larger paper across the river.

I didn't say it was easy, John. I said, vis-a-vis the case at hand, common sense dictates it is necessary. But hey, maybe I'm wrong.

What is your recommendation for 21st century buggy whip makers?

I'm all ears.

Name's Thomas Swift, John. I'm in the book.

I apologize for my snark -- it's a well-known literary name that could have been a pseudonym.

I don't disagree with you at all. Many Strib employees are going to have to start over in new fields.

In fact, I'm one -- a former reporter who left in the first round of buyouts almost two years ago now.

I knew I had to do it, and I did. But it was wrenchingly painful. I'm just asking for a little empathy for people who have been doing something they loved, were good at, and now are faced with the end of.

I heard, at least in the past, that some union members were making upwards of $55K, or there about, to stuff Sunday papers with the ads and coupons. And the Union would not allow for machines to do that job. Maybe some forethought on the Union side could have avoided this. That is $55K before all the nice benefits.

It seems to me that even a 20% cut for a job like that is still way too overpaid. That job, if it has to exist without mechanical assistance should be done by say a college student. Maybe one in Journalism school at the U.

Unions in the past were great advocates for members. They fought for good wages, decent hours, safe work places, health care, pensions, etc. But in recent memory, the only thing they seem to be good at is destroying the companies they work for. And in the process they destroy themselves. Thus leaving their members in the dust.

But at least this Union is not alone, they will have the Airline Mechs, Auto Workers, Finger Hut, Pilots, etc. Maybe some of the differing Union members can get together and swap stories of what their Unions did for them.

This Union must be mad to let it's members roll the dice on loosing their jobs in this economy.

Troy