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Gannett asks its employees to take a week off without pay, freezes wages for one year

Gannett asks its employees to take a week off without pay, freezes wages for one year

USA Today publisher Gannett Co has imposed one-week unpaid furloughs for most of its US employees, saying the move could help minimize the need for further layoffs amid a severe advertising downturn, the Associated Press (AP) reported on Wednesday. USA Today also declared a one-year freeze on wages effective February 1.

Although Gannett is regarded by many analysts as one of the most financially sound US newspaper publishers, the economic recession and the ongoing migration of advertising to the Internet have pounded its revenue prospects, AP said. Gannett had several rounds of layoffs last year, including one in December slashing the work force at most of its US newspapers by 10 per cent and another in November cutting newsroom jobs at USA Today by about 5 per cent. Gannett owns 85 US daily newspapers and 23 TV stations in the US. It has more than 40,000 employees.

The AP report said: [Link]

At Gannett, employees must take the furloughs during the first quarter. Union-covered employees will be asked to participate, and layoffs are possible if they refuse.

"After much consideration, we decided a furlough program would be the fairest and least intrusive way to meet these fiscal challenges in the first quarter, which is traditionally the lightest time of the year," Gannett Chief Executive Craig Dubow said in a staff memo. "We sincerely hope this minimizes the need for any layoffs going forward."

USA Today Publisher Craig Moon told employees in a separate memo that their sacrifices will keep the newspaper healthy. "We find ourselves in an incredibly tough media and economic climate," Moon said. "Our advertising revenues continue to slump as we enter 2009. With little visibility of future ad schedules, we like others at Gannett, have had to make some very difficult decisions."

In an unsigned supplemental memo, USA Today said the furloughs were necessary "to avoid the plight of some other companies and industries. Gannett is a solid company and we want to stay that way. Instituting furloughs at this time is a sound financial move by a sound company that is facing severe economic conditions."

Neither Moon nor Dubow disclosed expected savings.

Date posted: January 15, 2009 Last modified: May 23, 2018 Total views: 403