Projo’s Parent Co. Pushes to Cut Weekend Overtime Pay - CEO Makes 42x More Than Average Worker
Monday, October 21, 2019
Newspaper corporation GateHouse Media — owner of the Providence Journal and Newport Daily News — is seeking to cut overtime pay for their workers.
Governor Gina Raimondo’s administration has drafted an exemption to the “premium pay” requirement that requires that workers in Rhode Island who work on Sundays and holidays are paid time-and-a-half.
According to many who testified at the Rhode Island Department of Labor’s recent hearing to the proposed exemption, most of the production workers impacted earn between $12.50 and $14 per hour.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAt the hearing, Dave Robbins of the Teamsters Local 251 testified, “The minimum wage rate when GateHouse came in was $14 and change an hour - they implemented $12.50 for new employees. The company refused to hire any [new] full-time employees. The only full-time employees are employees hired before GateHouse. The company has created a part-time workforce with no vacation pay, no bereavement pay.”
If the exemption is granted to the newspaper, production workers who are new hires will make just $500 a week -- $26,000 annually -- for working full-time including time over weekends and holidays in a week.
As Robbins pointed out, however, the Journal has not hired full-time production workers since GateHouse took over -- so a 40-hour workweek would likely be a non-starter for new workers.
“Every time we ask them is the company making money, the answer is ‘yes.’ We asked if this was an issue of affordability -- they said it wasn't if they could afford it or not. They're exploiting workers, and it's a shame. They have no place asking for this favor,” added Robbins at the hearing.
Workers vs. Management
While the company is seeking to cut overtime costs, top executives at GateHouse earn millions. In recent years, Kirk Davis the CEO of GateHouse has been paid upwards of $1.7 million in compensation annually. According to one union website that tracks the compensation of CEOs, Kirk’s pay is 42 higher than the average pay of GateHouse.
The attorney for GateHouse, Mark Freel of the law firm Locke Lord, argued at the hearing that the cost of the overtime is prohibited, “The Journal and Newport Daily News publish 7 days a week. Every workday is like another -- newspapers are sold daily like bread. The requirement on Sunday premium pay — that costs in the range of $300K a year in premium pay.”
“Print journalism is already operating in a financially challenging environment — daily newspapers are trying to survive,” added Freel.
John Hill, who has headed the Providence Newspaper Guild over the past few years and is now a special assistant to the union, challenged the need for the cuts.
“We only know about the bonuses [at GateHouse] for the highest execs — there [is not information] for the bonuses just below. There is clearly money available. [Their request] is not to correct a competitive disadvantage — the GateHouse chain wants to make more money at the expense of the people who work for it,” said Hill, now a retired reporter for the Providence Journal. He took one of the paper's recent buyouts. Under GateHouse, dozens of jobs have been slashed in the newsroom -- today the number of news reporters have been cut to about 15.
Matt Taibi, who heads the Teamsters, Local 251 pointed out that The Providence Journal already receives a public subsidy as a state law from the 1950s requires governmental agencies to be advertised in the “newspaper of record.”
According to an analysis by Governor Lincoln Chafee’s administration, the 60-plus year requirement costs the state of Rhode Island and cities and towns between $750,000 and $1 million annually.
“Cities and towns pay for the requirement that the Journal be the record of public notice. The subsidy should not be the monopoly of the Providence Journal -- with this amount of money they receive from the public, they should be able to pay overtime,” said Taibi.
“The Journal employees a low-wage workforce — [the Journal] is unworthy of public sympathy. We don’t believe in comparing Rhode Island overtime laws with other states is a fair comparison -- other states have higher minimum wages. We don’t believe in a race to the bottom,” said Taibi.
“We feel strongly this should not be in the purview of the regulatory process — it should be with the General Assembly in the lawmaking process,” said Taibi.
The Providence Journal’s Publisher Peter Meyer argued that the company is a print company for third parties and that printers in other states don’t have a similar requirement.
“$300,000 is a burden. A big part of our business is commercial printing — we compete for the printing across New England with key competitors across New England — one of the key competitors is the [Boston] Globe in Taunton. [They] don’t have to pay Sunday overtime. So that puts us at a competitive disadvantage when we bid for jobs against them — we need to be competitive in the commercial print marketplace," said Meyer. "If we lost that work we have nothing. We don’t lose the overtime pay, we lose the pay altogether.”
The Globe recently announced it was cutting more than 100 union members at its printing press.
Meyer also said his company was struggling as a digital company as well. "We have a great deal of competition that has put our business model under severe stress. We compete with the likes of Facebook and Google — we have our own digital marketing business, but it’s slow to compete with the likes of Google and FB,” said Meyer.
After his testimony, Meyer refused to answer questions and walked away from GoLocal News Editor Kate Nagle -- SEE VIDEO HERE.
“I’ve heard a lot about how terrible the company is — I’m here to say I have to disagree — we are a good employer,” said Meyer.
In June, Meyer oversaw the closing of 32 GateHouse New England newspapers -- merging 50 local papers into 18.
Top Union Officials Challenge Projo’s Claims
A number of top Rhode Island union officials came to speak against the request for the overtime exemption.
“GateHouse Media is looking for something special — all while they’ve lined their own pockets with money. It’s a corporate vampire. They’re using us as their own piggy bank — on behalf of the 10,000 [NEA] members I work for, I hope you take this into consideration,” said Patrick Crowley of the National Education Association of Rhode Island at the Department of Labor and Training hearing.
George Nee, President of the AFL-CIO of Rhode Island said, “Their [GateHouse] revenue from an economic point of view, there seems to be no reason to give them this waiver — they’re becoming a dangerous monopoly.”
GateHouse is expected to finalize a merger in November with Gannett — combined the company will be the largest newspaper company in America.
According to media expert Ken Doctor, after the merger, the combined GateHouse and Gannett company will be slashing thousands of jobs. “More than 10 percent of the chains’ combined workforce — about 25,000 in the United States — will likely get the dreaded call from HR that their services will no longer be needed. How big a cut will that be? If the headcount reduction reaches 3,000 — which would be 12 percent of the workforce — that’s the equivalent of McClatchy’s entire employee count. And McClatchy will be the second-largest newspaper chain in America after this merger is complete,” wrote Doctor in a recent article.
“This proposal is cruel and selfish for them to request it — it shows you the kind of soulless thinking that goes on at the corporate level. This is real money coming out of the pockets of real workers. This is like them saying [to Rhode Island] give us an opportunity to participate in wage theft,” said Nee.
Paul MacDonald, President of the Providence Central Federated Council, AFL-CIO said, “[Workers] wage is modest at best. They give up church, families, a lot of events that take place on weekends to work for the company. Time and a half is a fair concept.”
“It’s wrong and embarrassing for me to be here today…it’s the worst case I’ve ever seen,” added MacDonald.
Raimondo Administration Defend Their Position
The Raimondo administration defended their support of GateHouse's request. “After reflecting on the precedents already in place, the Director [Scott Jensen] concluded the Gatehouse Media’s request was consistent with past exemptions and worthy of a public hearing,” said Angelika Pellegrino, Interim Chief Public Affairs Officer for the RI Department of Labor and Training.
Josh Block, Raimondo’s press secretary, tells GoLocal, “This change is designed to bring Rhode Island in-line with our neighboring states.”
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