The state's largest newspaper company is about to negotiate its contract with its employees. With workers seeking a share of the company's newfound profitability, and owner Richard Connor striving mightily to stay in the black, this could go very smoothly, or be a bloody, destructive battle — with the quality of information available to Mainers hanging in the balance.
Let's start with the basics. When Connor bought the Portland Press Herald/Maine Sunday Telegram, Kennebec Journal, and Central Maine Morning Sentinel in 2009, he did so with the help of the local chapter of the Newspaper Guild (part of the Communications Workers of America union).
To make the sale work, Connor not only laid off 100 people (a quarter of the company's unionized workers), but gave those who remained a 10-percent pay cut (under an agreement expiring June 30) and terminated company contributions to retirement funds. In exchange, the workers created an Employee Stock Ownership Plan, under which collectively the employees would own 15 percent of the company's value, in accounts that can be tapped for income upon retirement.
With the 15-percent stake, the papers' employees are the largest shareholder in Maine, according to Tom Bell, president of the local guild chapter and a staff writer at the Press Herald. (Larger shares of the company, he says, are held out-of-state by investors affiliated with the Texas-based HM Capital investment firm.)
Since taking over, Connor has announced that all three papers are profitable. Bell says the employees want to see some of the profits of the streamlined company.
"Our members' expectations are pretty high," Bell says. "We make 10 percent less . . . and our health-care costs are higher." (The company still pays 80 percent of employees' premiums, but co-pays and deductibles have increased, Bell says.)
In case there's any doubt, he clarifies: "The papers' finances have stabilized, and we'll be looking for raises" to make up the lost cost-of-living ground.
It's an unclear proposition, even in a company that looks stronger on paper than it was two years ago. Connor has sold off significant real-estate holdings (including the landmark building in Portland), but the proceeds have largely gone to pay down debt incurred in buying the papers. It's unclear how much of the company's profitability is due to an increase in revenue, as opposed to cost-cutting measures. That may mean that despite the lower debt load, there is no more operating cash than there has been.
Connor's not talking — he didn't return multiple requests for an interview for this piece, and Bell says he "had expected by now to have met with the company," but neither the union nor the company has yet asked the other to come to the table for a discussion.
• For those enjoying the spectacle that Governor Paul LePage and the Republican leadership in the State House have been creating, an excellent resource has been MAINEBIZ, the state's twice-monthly business newspaper. Most of its material, whether online, in print, or e-mailed to readers, has been culled from other media (with links and attribution). And that has its own usefulness. But when doing its own reporting, the publication has the sterling reputation and strong business-community connections to allow it to ferret out what really is — and isn't — affecting Maine businesses' efforts at job-creation. Since the LePage inauguration, Mainebiz has put out only two print editions, so a lot remains to be seen. But if the paper can separate itself from the business community enough to clearly discern what is partisan rhetoric claiming to be pro-business, and what is really something that would help Maine businesses and residents, Mainebiz will be a must-read.
Jeff Inglis can be reached at email@example.com.