Employees at the Los Angeles Times have until Oct. 23 to apply for the new buyout offer unveiled today and being sent to homes this week. Just about everyone on staff for at least a year is eligible to apply. It comes with a big inducement for older staffers. If you are still working at the paper on Dec. 31, you will no longer receive any retiree medical coverage should you stay at the paper long enough to retire. If you leave before Dec. 31, you will get the previously promised retiree medical coverage (for as long as the company still offers that benefit.)
This is for all of the Tribune Publishing's newspapers and there's no attempt to hide that this is about reducing costs. The company's stock price is in the tank and revenues are down, especially in Los Angeles, apparently. I expect to see a lot of more senior LAT staffers take this buyout, especially now with the retirement inducement. Apparently the severance portion will be paid out as salary rather than as a lump sum, so the tax bite is lessened and health benefits are retained during the payout time. If I am reading that correctly. It's unknown exactly how many people the LA Times will allow to leave, but speculation is that the target dollar figure adds up to between 50 and 80 positions.
Meanwhile, one longtime reader who also occasionally shows up in the pages of the paper send me a note regarding today's front-page ad (above) in the printed Times: "Can subscribers take the buyout?" It's the first example, I guess, of the kind of front page intrusion that new publisher Timothy Ryan is going to allow. Hey why complain? There are still three stories on the page.
Here is the announcement from Tribune Publishing CEO Jack Griffin, then from the company's HR person.
From: Jack Griffin
Sent: Monday, October 05, 2015 9:05 AM
Subject: Employee Voluntary Separation Program
Dear Tribune Publishing Employees:
Today we are announcing a Voluntary Separation Program for our employees. We are doing so now to allow employees to make decisions about their own personal and professional situations at a time when the company must continue to execute on its strategic plan, which includes reducing costs.
The senior management team and I recognize that each employee makes important contributions to our company. At the same time, in the challenging revenue environment that all publishing companies face, it is critical that we make hard decisions and take the necessary steps that continue to position Tribune Publishing Company for success over the long term.
Tribune Publishing is built on and committed to quality journalism and premium content. In our short history as an independent public company, our newspaper brands have been recognized for journalistic excellence and commitment to their local communities, including two Pulitzer Prizes at the Los Angeles Times and honorable mentions for the Chicago Tribune and The Baltimore Sun. And as you may have read last week, The Sun recently received recognition from the Online News Association for its outstanding digital coverage of recent events in Baltimore.
Concurrently, we are investing in digital products, technology and talent to move the company forward. To accomplish and continue this, we must adapt our current cost structure and business model to meet changing times. This is the rationale behind the Employee Voluntary Separation Program. We recognize and appreciate that the decision whether to participate in the plan is a difficult one. Our Human Resources team stands ready to support you in the decision-making process.
Any non-union employee with more than one year of service will be eligible to participate in the program. Eligible employees will receive a personalized and detailed packet within the next five business days, and will have until October 23rd to decide whether to apply for the plan. Cindy Ballard, our head of Human Resources, will send a separate note today with further information.
As the company enters the important fourth quarter, we appreciate the continued focus and dedication our teams are already demonstrating to deliver results for all our stakeholders. Thank you for your hard work during this time and for your ongoing commitment to the success of our company.
And from HR:
As Jack noted, today we are announcing the Tribune Publishing Company Employee Voluntary Separation Program 2015 (“EVSP” or “the Plan”). This program, which is an important step to position us effectively for the future and to respond to the challenging revenue environment within our industry, is voluntary. All non-union employees who have more than one year of service with the Company are eligible to participate in the EVSP.
The Plan offers several components, including:
Benefits Continuation for certain Health & Welfare Benefits
Eligibility for a Prorated Management Incentive Bonus (MIP), if applicable
Equity Vesting, if applicable
Retiree Medical, if applicable
During the Severance or Continuation Period, employees will continue to be eligible to participate in the following company health & welfare benefit plans:
Healthcare Flexible Spending Account
Dependent Care Flexible Spending Account
Health Savings Account
In addition, we are making the difficult decision to close the retiree medical program to all active employees as of December 31, 2015. In general and based on the individual Business Unit, employees currently eligible for the Company’s retiree medical program are defined in the Tribune Publishing Company Benefit Program (“Retiree Medical Program”) as an employee who has 10 or more years of service, was hired before April 1, 2003 and is at least 55 years of age as of the employees Last Day of Work. Based on the Company’s decision to close the plan for active members as of December 31, 2015, we have outlined the impact to employees below:
Non-EVSP Employee Impact: The Company’s retiree medical program will be closed to all active employees as of December 31, 2015; therefore the benefits under this plan will terminate for all active employees who remain employed by the Company after such date.
EVSP Employee Impact: Any employee who meets the eligibility requirements of the retiree medical program and will transition out of the Company as part of the EVSP will continue to remain in the program and receive benefits past the employee’s termination date, the plan closure date of December 31, 2015 or as long as the plan continues. The Company cannot guarantee that the Retiree Medical Program will be available to retirees at any time in the future and the Company reserves the right to modify, amend or terminate the Retiree Medical Program at any time.
Please find attached a more detailed summary of the Plan for more information. Additionally, every eligible employee will receive within the next five business days a personalized EVSP packet, which will be sent to their home address for review and consideration. In the packet, you will find several documents that will provide greater detail to help you understand the Plan, how to apply for the Plan, key action dates of the Plan and how the Plan will be executed overall. The packet will include:
Personalized Cover Note: Details your personal financial impact of the EVSP option
Summary Plan Description: Describes all the Terms and Conditions of the Plan including the Application Form and a Sample Separation Agreement and General Release
Frequently Asked Questions (FAQs)
Information About Post-Employment Benefits
Personalized Separation Agreement and General Release: Includes your personalized financial impact
TO BE CONSIDERED FOR THE PLAN, INTERESTED EMPLOYEES MUST SUBMIT AN APPLICATION BY FRIDAY, OCTOBER 23.
We recognize that this is an important decision to consider. Please discuss the Plan with your managers, your family and your personal advisors to decide if the decision is right for you. Following the EVSP, the Company and the individual Business Units will evaluate the results of the program and assess next steps as there may or may not be a need for additional involuntary reductions.
The Human Resources team is fully prepared to support you through this change. Please do not hesitate to contact your local Human Resources Business Partner or me with any questions you may have about the Plan, to review how this EVSP option impacts you specifically, or to discuss how the closure of the Retiree Medical Plan may affect you.