17 May 2010

Pa. Newspapers' Layoff Notice Called 'Procedural'

Associated Press

PHILADELPHIA — Employees of Philadelphia's two major newspapers have been sent a letter warning of possible layoffs, but the lenders who won the newspapers at a bankruptcy auction last month say the notice is "procedural" and no such action is planned.

The letters, sent Friday on letterhead of The Philadelphia Inquirer and Philadelphia Daily News, say the new owners "will continue as the employer of all employees" but also note that the letter would serve as notice under a federal law that requires employers to give 60 days' notice in the event of mass layoffs.

"The letter is a procedural letter. It was agreed they would send it out up at the auction in New York," said Robert Hall, named chief operating officer by the new owners. "The old company goes out of business that day and we start anew."

"Our intention is still exactly the same as it was before," Hall said. "There will be no massive layoffs when we take over the company."

Creditors last month won a frenzied bankruptcy auction for the two newspapers and their website over a local group's bid. Greg Osberg, who has been named publisher and chief executive officer, has said he expects the sale to close in late May and hopes to complete contracts with the newspapers' unions by the end of June.

In a note accompanying the letters, outgoing publisher Brian Tierney said he was sending them "with a heavy heart, but at the direction of the prospective owners."

"Issuing this kind of ... notice does not happen in every sale," Tierney said. Such notices weren't issued when the previous owner, Philadelphia Media Holdings LLC, bought the newspapers nearly four years ago, he said.

Dan Gross, a Daily News columnist and president of the union that represents newsroom and advertising employees, said he had been assured that no job cuts are planned at the newspapers, which have about 4,500 full-time and part-time workers.

"They reiterated their commitment to offering employment to all current employees," Gross said.

Gov. Ed Rendell said a company lawyer had given him similar assurances and told him the letters were required because of "an entity change."

Rendell said he would have no problem if there were no layoffs or unilateral reductions in wages and benefits, but "if they unilaterally offer ... wages at 75 percent or 50 percent benefit cuts, that would be absolutely wrong and a betrayal of the process."

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