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In Key Vote, Union at 'Star-Ledger' Agrees to Wage Freeze, Buyouts -- Shutdown Still Possible



Published: September 23, 2008 7:40 AM ET

NEWARK A union representing 400 mailers at New Jersey's largest newspaper overwhelmingly agreed Monday to a three-year wage freeze and buyouts of a quarter of its members.

Teamsters Local 1100 ratified the revised contract by a vote of 183-18 during a meeting in Piscataway, N.J., leaving The Star-Ledger of Newark, N.J., with just one union still in negotiation. The Star-Ledger's publisher has threatened to close or sell the paper in early January if it cannot reach a deal by Oct. 8 with its drivers' union as well.

The 10-1 ratio of the mailers union's approval "is pretty extraordinary given the subject matter of this," said Andrew S. Hoffmann, an outside lawyer for the Teamsters local. "Not that anybody was pleased," he said, but members recognize economic realities.

The Teamsters leadership had earlier endorsed the deal, which scraps wage increases guaranteed under an existing contract that was to run until 2011.

The new contract, to expire 2013, calls for lump-sum payments of about 1 percent a year, which is less than the 2 percent guaranteed under the existing contract and would not increase the salary level on which future wage increases would be based, Hoffmann said.

Hoffmann said the union was willing to settle given "the precipitous fall that has been experienced in the newspaper industry."

The 100 buyouts will mostly affect higher-paid employees and work related to preprinted advertising inserts in the newspaper's Sunday editions, Hoffmann said.

Inserts, he said, have faced "extraordinary competitive pressure given how cheap it is to advertise on the Internet."

The Star-Ledger is seeking to further reduce its payroll through buyouts of 200 workers among the paper's 750 full-time nonunion employees. The deadline to apply for a buyout is Oct. 1, and the newspaper has not said whether it is close to reaching the target.

Star-Ledger Publisher George Arwady notified employees last week that a contract deal with its drivers union was unlikely. Thus, formal notices required by law were being sent to advise employees that the newspaper will be sold or close on Jan. 5.

The Star-Ledger is New Jersey's largest newspaper with a daily circulation of about 350,000. The paper has posted losses for at least three straight years and is on pace to lose between $30 million and $40 million in 2008.





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