Publisher: Star-Ledger will close if unions don’t agree to a deal by September 27

Star-Ledger publisher Rich Vezza says his threat to close the paper if there’s no deal with production unions by the end of September “is serious.” He tells employees: “I know today’s news is unsettling, but we are hopeful that we can now forge ahead and come to an agreement. The Star-Ledger is simply too important to everyone, including non-union and union employees.”
The Star-Ledger’s Ted Sherman points out that this isn’t the first time the paper’s owners have threatened to close the paper if demands for concessions aren’t met.

Sherman writes: “In July of 2008, then-publisher George Arwardy said the paper was on ‘life support’ and would close if it didn’t receive large numbers of buyouts and concessions. Two months later, the paper announced new deals with its drivers and mailers unions and said it had secured more than 200 buyouts from its 750 full-time, non-union employees.”

TO: Star-Ledger Staff
FROM: Rich Vezza
DATE: Wednesday, June 26, 2013
RE: Union Negotiations Development

I want to inform you of an important development in our negotiations with our production unions. Today by letter, we notified the four unions involved in our production and packaging that we must have an agreement with them by September 27th or we plan to cease publishing The Star-Ledger at the end of the year. Despite the current state of negotiations, we are optimistic that the production unions will understand it is in everyone’s best interest – the community, the newspaper’s employees and the unions – to successfully come to an agreement.

Obviously, this announcement is serious, and I want to give you some background on how and why we’ve arrived at this point.

The Star-Ledger has lost a significant amount of money in the past several years. In 2011, the paper lost $12 million. Last year, the paper sustained $19.8 million in losses. The company anticipates it will lose the same amount in 2013 as it did in 2012./CONTINUES

Knowing that our union contracts would expire this July, late last year The Star-Ledger began to explore ways to reduce its production costs, including the possibility of outsourcing its production and packaging to another company. After receiving a number of bids, we determined that we could save $9 million through outsourcing, not enough to restore us to profitability, but enough to significantly reduce our losses while we worked to increase revenue and reduce costs in other areas.

In December, we asked the unions to begin negotiations with us and offered them an opportunity to approximate the $9 million savings we could obtain through outsourcing. If the unions provide savings to approximate the savings that could be obtained through outsourcing, this would allow us to continue to print and package in-house, preserving both union and non-union production jobs here at The Star-Ledger – otherwise, we would like to outsource to obtain the savings. In the six months since we contacted them, the unions have granted us only two general meetings, where we met with representatives of all the unions, and two individual meetings with each of three unions where we attempted to make some headway. Regrettably, it is apparent that the unions have little or no interest in meaningful negotiations. Frankly, we feel we have been pushed into a corner.

We are hopeful that today’s letter to the unions will give these negotiations the attention and urgency they require.

I know today’s news is unsettling, but we are hopeful that we can now forge ahead and come to an agreement. The Star-Ledger is simply too important to everyone, including non-union and union employees.

Lastly, I want to acknowledge all the sacrifices our non-represented employees have made over the past five years. We have reduced wages and benefits, have had unpaid furloughs, a wage freeze, buyouts and layoffs, all in an effort to reduce our losses and keep The Star-Ledger publishing.

Over the next couple of weeks I will be meeting with groups of employees to discuss the status of negotiations and answer any questions you might have.

Rich Vezza