Washington Post offers buyouts for 5th time in recent years
This morning, news of a new buyout offer began circulating in The Washington Post newsroom. This is the paper's fifth round of buyouts since 2004. Post ombudsman Patrick Pexton tweeted this afternoon that the buyouts would be capped at 48 people or 8 percent of the 600-person newsroom.
The Washington Post Company, which owns the Post, Slate, a community newspaper group, and an educational unit, had a dismal third quarter. Its report from that time period was filed last November (PDF). It said that newspaper revenue was down 9 percent from the same period the year before, advertising revenue shrank 20 percent, online revenue was down 14 percent, and circulation had declined (down 5.4 percent weekdays, 4.4 percent on weekends). The company’s newspaper division lost $9.9 million in the third quarter alone.
The Post Co.’s Kaplan unit saw its revenue fall by 79 percent following an unexpected government interest in the for-profit college sector.
Previous buyouts were financed by the Post's gilded pension assets. As the company's 2010 annual report (PDF) stated, "unusually for an S&P 500 company, we continue to have an overfunded pension plan. We haven’t had to contribute to the plan in decades. There’s almost no chance we’ll have to contribute in the near future."
Here's the memo:
From: Marcus Brauchli
Date: Wednesday, February 8, 2012
Subject: Announcement to newsroom staff
To: NEWS - All Newsroom
To the staff:
Today, we are announcing that we will offer a voluntary buyout to some Newsroom employees. Our objective is a limited staff reduction that won’t affect the quality, ambition or authority of our journalism. We believe this is possible, given the changes in how we work and the great successes we have had building our digital readership lately.
To preserve that momentum, we do not intend to offer this program to every department or individual in the Newsroom. The reality is that we’re able to absorb staffing changes better in some areas than in others. In those departments where we do offer the buyout, there will be caps on the number of people who can participate, in order to moderate the impact and preserve our competitiveness in core coverage areas. In addition, we may turn down some volunteers if we feel their departure would impair our journalism. That said, it is important that we achieve real savings.
The exact details of the buyout, technically a voluntary Separation Incentive Program, will come later, after the company talks to the Guild about its proposed terms. Here’s what we can tell you now: The program does not accelerate pension benefits. It will include enhanced separation payments and company-paid COBRA (health insurance) premiums for eligible fulltime employees. Post representatives will be discussing the proposed program with the Guild over the next two weeks, consistent with the terms of the labor contract. The terms they agree on also will be included in an offer to Newsroom editors in eligible departments.
This program will be available for a specified period of time only; employees will have 45 days to study this offer and decide whether to accept it or decline it. The Post will schedule the final date of employment for those who elect to resign as part of this program; for most employees this will mean a resignation date of May 31, 2012.
Any measure like this is difficult. But we believe this approach is a sensible and effective way of addressing the economic forces affecting our industry. We constantly rethink how we do certain things in order to become more efficient, agile and competitive; this will require more such thinking. The Post’s Newsroom remains formidable, and we will continue making tactical hires so that even as we get smaller, we get stronger.
We plan to distribute SIP packages to eligible employees in a few weeks. We will have two Town Hall meetings today, at 11 a.m. in the Community Room and at 4:30 p.m. in the Auditorium, to answer your questions.
Pexton tweeted some additional details about the offers. “Core journalism” departments won’t be eligible, he writes. Those include: National politics, foreign, Style and Sports columnists, Weekend staff, Sunday Outlook, graphics and Capital Business. Non-core, as of today: Photo, Style, Metro, Sports, Business (so much for “for and about Washington”?), and "everything else in newsroom." The Investigative team is eligible for buyouts, the National Enterprise team is not, Pexton said. Op-ed and editoral are "unaffected." And the Web staffers? "I'm still unclear on this, at this point," Pexton writes in an email. "Still asking questions."
Related: Nice Guy, Finishing Last: How Don Graham Fumbled the Washington Post Co. (Forbes) | "Some of you sitting in our vast cubey expanse are dead weight." (Washington Post)