Some Teamsters truckers, who have been feuding with the Seattle Times Co. since last November over plans to outsource heavy trucking to independent contractor Penske, voted Sunday, Sept. 21, to authorize a walkout if their contract dispute is not resolved by Sunday, Sept. 28.
The vote is the latest development in the financially strapped Times Co.'s bi-coastal survival struggle with unions and bankers. In addition to the fight with Teamsters Local 174, which represents 74 truckers who haul The Seattle Times and separately owned Seattle Post-Intelligencer to distribution warehouses in the Puget Sound area, the Times Co. is also seeking to force the Portland Newspaper Guild in Maine to agree to an early termination of a four-year contract that expires in 2011. Times Co. officials say the contract has held up plans to sell the company's Blethen Maine Newspapers chain. The union represents more than 300 Blethen Maine employees.
The Times Co.'s broader financial problems stem from a $230 million loan the company took in 1998 to buy the Blethen Maine chain, which includes the Portland Press Herald and Maine Sunday Telegram, the Kennebec Journal in Augusta, the Morning Sentinel in Waterville. Since then, the company has twice defaulted on loan covenants. Blethen Maine chief executive Chuck Cochrane said in a July 28 affidavit filed in federal court in Portland that the Times Co. faced another default if it could not sell the Maine chain soon.
Earlier this month, a federal judge directed Blethen Maine and the Guild to take their fight to arbitration in January. In his affidavit, Cochrane warned that if the chain is not sold soon, the Seattle Times Co. might be forced to shut down the Maine papers.
Times Co. officials have said that default could come as soon as the end of this month if the covenants expire and the company cannot meet lender financial requirements. The Times Co. is privately held by the Seattle-area Blethen family and does not release financial information, but company officials have said they expect the Times Co and Blethen Maine to lose money this year.
In addition to The Seattle Times and Blethen Maine Newspapers, the Seattle Times Co. owns the Yakima Herald-Republic, the Walla Walla Union-Bulletin, NWsource.com, real estate in Seattle's South Lake Union neighborhood, and Rotary Offset Press in Kent, Wash.
Times Co. spokeswoman Jill Mackie said a strike by the union "would be very damaging" but the company has been seeking ways within the existing Teamsters contract to reduce wages. "We remain hopeful we will find a successful resolution that will benefit both affected employees and the company," she said.
Mackie said the Seattle Times Co. had no comment on the status of efforts to sell the Blethen Maine chain.
Here in Seattle, the Times Co. and Local 174 narrowly avoided a walkout last Wednesday, Sept. 17, when company officials announced during a late-night bargaining session at Teamsters headquarters that they planned to issue paychecks to the union truckers under a revised pay schedule that union officials said would cut the drivers' pay by an average of $3.48 an hour.
"We told the Times that if we see a paycheck hit like that we're going on strike," said Patty Warren, Local 174's senior business agent. At 4 a.m., Warren said, Times Co. officials agreed to tear up the payroll run and re-issue the checks at the old wage rate.
Union officials said the two sides remain apart. The Times Co. had sought to outsource the Teamsters jobs to independent contractor Penske, but those plans fell apart earlier this year and the union notified the company July 29 that it was issuing a 30-day "termination notice" to end the contract and free up the Teamsters to strike. The 30-day waiting period was suspended last month to allow for more negotiations, but Warren said the clock would begin ticking again on Sept. 29, and the contract would technically run out Oct. 19, leaving the union free to call a strike.
It isn't clear whether the local could shut down the Seattle Times Co. by itself. But Local 174 officials say they have sought support from other larger Teamsters locals at the newspaper, as well as from the Newspaper Guild, which represents news, advertising, and other employees and is renegotiating its own contract with the Times and the Hearst-owned P-I. Under a joint operating agreement, the two Seattle dailies publish separate newspapers, but the Times prints, distributes, and markets both.
"We are at a crucial crossroads in these negotiations with the Seattle Times," Rick Hicks, Local 174's secretary-treasurer, said in a press release the union issued Monday, Sept. 22. Hicks said the union still hopes to reach an agreement with the Times by this weekend. "If not," he said, "it will be extremely problematic for The Seattle Times."