At the Seattle Times Alayne Fardella, the company'ês labor chief told the paper'ês staffers in an e-mail this morning they better start preparing at once to help weather what Fardella calls 'êthis economic tsunami'ê buffeting the Times Co. Fardella'ês e-mail explained how The Times expects its workers to do that: 'êWe are asking that each employee group contribute savings equal to approximately 12% of their payroll and benefits expense.'ê The e-mail offered no specifics on how to do that, but said the company can'êt take the time to re-open formal contract negotiations. 'êWe simply cannot afford to delay,'ê Fardella said.
At a three-hour meeting with union reps yesterday near The Times' headquarters Fardella, along with Times Co. chief executive Frank Blethen, company president, Carolyn Kelly, and other senior Times officials, made a similar pitch, saying the company is facing a liquidity crisis because it hasn't been able to sell its downtown real estate or its Blethen Maine newspaper chain.
The Times Co. owes a banking consortium led by Bank of New York Mellon $91 million. The company has been trying to raise cash to meet its debt obligation by selling five acres of real estate it owns in the South Lake Union development area, as well as its Blethen Maine newspaper chain. These are terrible times to be selling newspapers and real estate, especially since financing is so difficult to find.
According to one attendee, Times Co. officials said they believe the company can become profitable again by 2012 if it gets the 12 percent across-the-board wage and expense cuts and a cash infusion from the sales, and if the company'ês lenders cooperate.
Those are very big ifs. While Blethen and other Times officials told yesterday'ês gathering that The Times' overall readership has been growing, the print edition of The Times has shrunk to as little as 28 pages on some days recently and print ad revenue has continued to decline. Blethen and the others at yesterday'ês meeting declined to say who is currently making the company'ês financial decisions or how long The Times has before will be forced to seek protection from its creditors under Chap. 11 of the federal bankruptcy code.
'êMy impression was, the sooner those cuts happen, the better,'' the attendee told Crosscut. 'êThey said the longer this goes on, the more the bad numbers compound against you, and that need for a 12 percent cut will grow.'ê