Mercury News, East Bay Times to face ‘significant’ layoffs

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The Bay Area News Group, or BANG, which includes the Mercury News and East Bay Times, announced Friday that it will be hit with “significant” staff layoffs in the coming months.

BANG announced that it would have to reduce staff numbers and that some employees would be offered buyout packages to incentivize their departure from the company, according to BANG executive editor Neil Chase.

Chase said a “significant portion of the staff” would either be bought out or face involuntary termination, but he declined to give a specific number.

“It’s a crummy situation, but we try to be honest with people,” Chase said.

Employees that have at least 25 years of experience with BANG are eligible for the buyout package. Eligible employees have until the end of January to accept the package, which includes 26 weeks’ worth of salary and 5 months of health care benefits, in exchange for leaving their employment, according to Pacific Media Workers Guild executive officer Carl Hall.

The labor agreement in place includes provisions that limit which employees BANG can terminate involuntarily, Hall said. It is possible for a senior employee to be involuntarily terminated after the end of the buyout period if they do not accept the buyout.

The initial round of buyouts may not be enough to prevent involuntary terminations, Chase said.

Norma Guillen, a receptionist at the Mercury News, said employers told her Monday that she was being terminated. The Mercury News is providing her with two weeks’ compensation, but Jan. 19 will be her final day of work.

“We saw it coming,” Guillen said.

BANG performed a similar buyout in 2016, and layoffs have occurred several times since then, according to Chase.

In December, the advertising department at the Mercury News underwent a previous round of involuntary terminations, according to Guillen.

BANG and the Pacific Media Workers Guild, which represents BANG employees, offered different explanations for the layoffs.

Chase said the layoffs address the decline in newspaper advertising revenue across the United States, which has occurred annually since 2000.

BANG’s readership continues to increase, said Chase, with tens of millions of people across the country reading their articles, especially for stories related to the technology industry and the Golden State Warriors. Revenue, however, is in decline because of a reduction in print sales.

Hall, however, said the terminations are part of an effort by Alden Global Capital, which owns BANG, to maximize short-term profit.

Alden Global Capital, Hall said, is a “vulture hedge fund” that buys low-cost properties at low prices and strips them of their assets, buildings and staff to reap maximum profit.

“When there’s not much left to cut, I imagine they’ll sell (BANG),” Hall said.

BANG’s terminations are more extreme than those of other news organizations including the New York Times and the San Francisco Chronicle, which are also facing staffing cuts, according to Hall.

According to Chase, there is currently no standard for how much notice BANG must give their employees before termination. The more in advance the better, Chase said, but the interest of the business is the company’s guiding principle.

“In the environment we’re in — in the country right now — news organizations may have financial pressures,” Chase said. “There’s more need than ever for what we do.”

Contact Henry Tolchard at [email protected] and follow him on Twitter at @htolchard.