In case you missed it, Michael Calderone of the Huffington Post weighed in with a very interesting story Tuesday on turmoil at the New York Times Co. At the top of the list is the $15 million being paid to departing chief executive Janet Robinson, who by all appearances had a falling-out with company chairman Arthur Sulzberger.
No doubt you recall that the Times Co. demanded the Boston Globe’s unions agree to $20 million in givebacks in 2009 as the price of keeping the paper alive. Now Sulzberger has given 75 percent of that money to one person. Yeah, yeah, it’s a one-time expense versus annual savings from the unions, but you get the picture.
The Times Co. this week also followed through on its plan to sell its Regional Newspaper Group, 16 smaller dailies in the South and the West. Media business analyst Ken Doctor tells the Times that the sale price of $143 million was “incredibly low” (indeed: only 9.53 Robinson-size buyout packages), and that the deal buys company executives time to think about whether it wants to keep or sell the Globe.
Following a tumultuous 2008 and ’09, the Times Co. appeared to have achieved some stability, putting its financial house at least somewhat back in order. It looks like that stability may now be coming to an end.
Within days of Janet Robinson’s sudden retirement as chief executive of the New York Times Co., word leaked that the company was looking to sell its smaller papers in the South and the West.
Which raises a question: Is the Times Co. finally ready to sell the Boston Globe? I review the rocky history of Times Co. ownership in my latest for the Huffington Post.
What will the apparently less-than-pleasant departure of New York Times Co. chief executive Janet Robinson mean for the Boston Globe, its second-largest newspaper?
Obviously it’s way too early to say. But no sooner had the word gone out last night than Globe editor Marty Baron tweeted, “Grateful for her support of the @bostonglobe: New York Times CEO Janet Robinson to retire.” Not that it’s possible to read too much meaning into that.
On the other hand, Financial Times columnist John Gapper read plenty of meaning into the Times’ own account of Robinson’s retirement, tweeting, “Sulzberger fired Robinson, according to NYT (in ninth para)” (via the inestimable Jack Shafer). And what does that ninth paragraph say?
Last Friday, Mr. Sulzberger called a meeting with Ms. Robinson on the 15th floor of the company’s Manhattan headquarters. He raised the issue of installing a different type of leadership at the company, according to people familiar with the meeting who declined to be identified discussing confidential company business.
The Times Co. has done a far better job than most newspaper companies of transitioning to the digital age. The Times and the Globe have pioneered the introduction of flexible paid digital editions. Moreover, both papers are performing financially much more strongly than they were when the bottom nearly fell out of the entire industry back in 2009. So you’d think Robinson would be on the plus side on those two key issues.
Nor do I think it’s credible to believe she was ousted because of the Times Co.’s collapsing stock price. As Ira Stoll notes at Future of Capitalism (via Romenesko), $10,000 worth of stock in 2004, the year she took over, would be worth $1,855 today. But that’s an industry-wide trend, and, seen in the context of major newspaper companies like Tribune falling into bankruptcy, the Times Co. seems to have done rather well.
So it will be very interesting to see what the real reason is for her abrupt, well-compensated ($4.5 million next year) departure.
Unrelated observation: Given their travails of recent months, how cool is it that I’m able to credit both Jack Shafer (now with Reuters) and Jim Romenesko in the same blog post? The natural order has been restored.
One month after Newspaper Guild members at the Boston Globe circulated a letter criticizing New York Times Co. chairman Arthur Sulzberger and president Janet Robinson for richly rewarding themselves while threatening to shut the Globe, their counterparts at Worcester’s Telegram & Gazette have followed suit.
Beset by what they describe as a four-year pay freeze, substantial newsroom downsizing and proposed cuts in benefits, union officials say management has repeatedly called for “sacrifice” while Sulzberger and Robinson paid themselves more than $12 million in 2009.
As you no doubt know, the Times Co. operates the Globe, the T&G and Boston.com as a unit known as the New England Media Group. But though the Guild has a presence at both papers, the largest union at the Globe is the Boston Newspaper Guild, whereas T&G employees are represented by the Providence Newspaper Guild.
The Worcester protest coincides with an announcement by the T&G that it will start charging for some online content starting this summer. (So, too, will the Concord Monitor, as the paid-content trend continues to ramp up. Here is Tony Schinella’s take.)
The full text of the Worcester Guild’s press release and letter to Sulzberger and Robinson follows.
NYTimes Execs Big Raises Gall Guild in Worcester
Bob Datz 508 xxx-xxxx
Lee Hammel 508 xxx-xxxx
Worcester Unit Council members
Local 31041 The Newspaper Guild
The letter below was sent April 23 to NY Times Co. chairman Arthur Sulzberger Jr. and CEO Janet Robinson by the Worcester (Mass.) unit of The Newspaper Guild, expressing frustration with the enormous pay raises they recived.
During the three years that contract negotiations with the Guild in Worcester have stretched out, the company has offered its employees no pay raise. (The day before union members were scheduled to ratify the letter, the company finally offered a one-time $750 signing bonus, which amounts to about 0.4 percent of pay over 3 years without raising base pay, in exchange for stripping away hard-won rights and benefits).
We would appreciate if you would consider a story alerting your readers to the dichotomy between the NYTimes editorial insistence that others behave justly and its attitude toward its own employees.
April 23, 2010
Arthur O. Sulzberger, Jr.
President and Chief Executive Officer
The New York Times Company
620 8th Avenue
New York, NY10018
Dear Arthur and Janet,
Many of us at the Telegram & Gazette in Worcester don’t pay a lot of attention to high finance in New York. We have terrific jobs in the world’s best industry, and we are only too happy to concentrate on the business and politics and human drama that enliven Central Massachusettsday in and day out that we are privileged to gather and write and distribute.
But even the most focused of us could not help but notice the pay raises that both of you received for 2009. You have told us that our business is changing and times are difficult, and we have heard the same in contract negotiations over the past three years. We understand that we must change with the times in an environment where paid circulation and advertising revenue are falling. And management has told us that sacrifice is necessary.
So imagine our surprise upon learning the kind of “sacrifice” that you are enduring. As President and Chief Executive Officer, you Janet, have been given a 31.8 percent increase in salary, bonus, and other compensation in a single year, bringing your total compensation to $6.3 million.
Arthur, as Board Chairman and Publisher of the New York Times, your total compensation more than doubled in 2009, to $6 million. The $3.7 million that your compensation increased could pay the salary of some 75 of the people that have been laid off by the company, some of whom we have been saddened to see walk out our own doors.
Meanwhile, The Newspaper Guild has been in negotiation with the management in Worcester, as our contract expired nearly three years ago. Fortunately, we are told, the Telegram & Gazette is not only not losing money, but continues to make money through this period, albeit at lower than customary levels.
Nevertheless we have been offered neither a pay raise nor bonus over a four-year period. In fact, the company proposes to slash real compensation when benefits are considered. Management also wants to stop offering a pension to any new hires and to freeze the guaranteed pension of those of us who have one, in a “tradeoff” that the company should be well aware calculates to significant losses in projected retirement income.
While offering little or no financial incentive, the company wants to change contract language to remove the substantial equivalency of our medical coverage with no guarantees on the proportionate sharing of the premium costs. Finally, the company wishes to be allowed to lay off employees regardless of seniority.
This takes place in a backdrop of existing layoffs, buyouts and hiring freezes that have brought an 18 percent reduction of the company’s work force in 2009 alone. The employees remaining are asked, or forced, to reduce their benefits in the wake of a management decision to build a new skyscraper for the company headquarters. Our productivity subsidizes not only distant and ill-fated real estate transactions (click here) but deficits in units where employees are paid significantly better than we are, even with recent concessionary contracts.
We are thrilled to see the New York Times editorial pages seek fair treatment for people. Arthur and Janet, we ask that we, like you, receive some financial consideration for our efforts and that you recognize the increased work load we have taken on, because we, like you, have families who depend on us.
Members of The Newspaper Guild
Worcester Unit, Local 31041
The following e-mail, dated Thursday, was sent to members of the Boston Newspaper Guild, the largest union at the Boston Globe. Media Nation obtained a copy of the e-mail from a confidential, reliable source. Click here for background. (As you will see if you click on the link to Editor & Publisher below, the Guild was not entirely accurate in describing the compensation packages of Times Co. chairman Arthur Sulzberger and president Janet Robinson.)
As you may have heard, the NY Times recently awarded its top two executives more than $10 million in stocks and bonuses for their performance in 2009, a year that for most of us in the Boston Newspaper Guild was a disaster. Two people, Janet Robinson and Arthur Sulzberger, received stocks and stock options equal to the pay and benefit cuts that they demanded from our whole union under threat of closing the Boston Globe for good. We want the New York Times leadership to know that we’re angry and disgusted by their greed and hypocrisy.
Please take a look at the attached letter of protest as well as the link to news coverage of their big pay day. If you agree that it’s wrong and you want to send a message, please email us that you are willing to have your name attached to the letter.
We face contract negotiations with the New York Times company later this year and we want them to know well in advance that, if they can afford to pay executives so much, we expect similar generosity.
Dear Arthur and Janet,
We were astonished to learn that the two of you received more than $10 million in stock awards and options in 2009. During the year for which you were so richly rewarded, the 600 members of the Boston Newspaper Guild gave back almost the same amount in pay and benefit reductions — $10 million, to be exact — after you threatened to close our newspaper, lay off hundreds of people, and strip Massachusetts of its largest newspaper.
Previously, New York Times officials told us that we needed to accept pay cuts and unpaid days off along with higher health costs, the elimination of our retirement programs and other benefit reductions in order to save the Boston Globe. But the recent SEC filings make it look like almost all of our sacrifices went to pay the two of you. For most of us up here at your newspaper in Boston, 2009 was financially disastrous, as Guild members were forced to move to cheaper housing, take second jobs, scrap vacations and make other drastic measures to offset more than a 15 percent reduction in our pay and benefits. We made these sacrifices under duress, yes, but also because we understood that the Globe faced real financial challenges in an economic downturn and a dramatically changing marketplace. We did it because we care deeply about our newspaper, its mission, and the critical role it serves in our region and our nation. And we did it with an expectation that our sacrifices would be shared across the company.
The two of you gave us the impression that you understood all that when you visited the Globe last winter. You even personally thanked us for giving up so much for the greater good. Now we learn that, all the while, you were in line for astronomical bonuses over and above your million dollar salaries. Ms. Robinson’s compensation rose 32 percent last year; Mr. Sulzberger’s overall pay more than doubled. While you’ve stopped contributing to our modest retirement plans, the value of your own pensions has increased sharply.
Needless to say, we are insulted, but we also feel betrayed that you would reap such profits at a time when so many of your employees have lost so much.
Our nation’s history is filled with corporate executives who profited handily by cutting workers’ salaries and eliminating jobs. But few of those figures helmed newspapers that have done eloquent, important work in revealing and condemning such practices. For this reason, we are hopeful — as both shareholders and employees — that you will govern this company with morality and a basic sense of fairness.
We have appealed to you once before this year about the Times’ seemingly excessive largesse to its executives in such troubled times. The Times Co. handed out more than $500,000 in cash bonuses to the Boston Globe’s publisher [Steven Ainsley] on his retirement — just as the employees he left behind were forced to schedule eight unpaid days off. We hope that, this time, you will give us the courtesy of a reply and an explanation.
Now that the Times has shown it can afford to lavish so much on a few top executives, we expect our pay and benefit cuts will be restored in the coming months. We look forward to hearing from you.
Members of the Boston Newspaper Guild
Check out some of these numbers at the New York Times Co., courtesy of the Boston Herald:
- About $6 million in total compensation each for chairman Arthur Sulzberger (up more than 150 percent over 2008) and president Janet Robinson (up 32 percent).
- About $2 million for former Boston Globe publisher Steven Ainsley.
Just for the heck of it, let’s assume Sulzberger and Robinson, in deference to their company’s problems, had decided to get by with a paltry $1 million apiece in 2009. Ainsley, too. That’s $11 million — or 55 percent of the $20 million in union givebacks the company extracted from the Globe’s unions. We are talking about three people.
No question the Globe needed to downsize and reinvest in new technologies. No question it couldn’t support nearly as many staff members as it had once employed.
But the bonuses show, in case there was any doubt, that the cuts in pay and benefits was, for management, a war of choice, not of necessity.