LA Times union busting by Tron!c Lyrics
Your Questions Answered
Newsroom employees have asked a number of questions about unionization and other matters through an anonymous Q & A link. Some questions were asked multiple times and, in those cases, we have provided one answer below. We will provide answers to the additional questions we received early next week. This site will be updated with answers as additional questions are submitted.
Q: Why do we have a EIC, Executive Editor, President and Publisher?
A: The company leadership is dedicated to bringing on the best talent to build on the successes of the LA Times while adapting and flourishing in a rapidly changing media environment. That is the premise from which we have made strategic talent decisions to date and how we will make talent decisions in the future.
Q: Why did we go so many years with a single cost of living increase? Our competitors have consistently provided cost of living increases despite the state of the industry?
A: Just last year, we awarded a 2.5 percent performance-based raise across all tronc editorial departments with the exception of our News Guild unionized employees, specifically in Baltimore and Chicago. More than 80 percent of LA Times newsroom staff received wage increases. Though we can’t speak to salary levels at other news organizations, the news industry faces significant challenges to meet a changing media landscape as evidenced by the significant reductions at some newsrooms across the country and the wholesale closing of other outlets in just the last few weeks. The leadership of The Times is confident in its plans to meet those challenges and is fully committed to continue bolstering the Times’ stellar reputation for providing the kind of quality journalism that defines our newspaper. We will continue to share those plans with the hard-working members of our newsroom who form the backbone of that journalism excellence.
Q: What is the compensation of the current masthead members? How frequently have these masthead members gotten raises?
A: Other than certain executive officers whose compensation we are required to disclose by law the Company does not disclose the compensation of any of its employees.
______
Q: Why is Tronc CEO Justin Dearborn’s compensation $3 million more than that of New York Times CEO Mark Thompson, whose company has revenues similar to ours but a market value many multiples of Tronc’s?
A: Quoting a number out of context doesn’t tell an accurate, fact-based story. Like most public company executives, the vast majority of the compensation is awarded in the form of stock ($6.9 million of the $8.1 million). The $6.9 million represents a theoretical value at some time in the future, and is tied directly to how our stock performs.
Our senior executives are compensated similarly to others at comparable companies. In fact, we work closely with external compensation consultants to ensure we fit within basic guidelines for our industry. Justin, like similar executives here and throughout the industry, has a base salary, a bonus and is granted equity. Both the bonus and equity are closely tied to overall company performance.
Justin’s equity compensation was granted to cover a three-year period and is not an annual equity grant. The equity vests equally over a three-year period.
So how does equity work? Let’s start with stock options. A stock option is simply the right to buy tronc stock at today’s price (the “option price”) sometime in the future. Justin received the 225,000 stock options at $14.87 per share. That means that at some point in the next seven years, Justin has the opportunity to purchase 225,000 shares of tronc stock for $14.87 per share, should he remain employed during the vesting period. In order for the stock option to have any real value, the stock price has to be above $14.87 per share– otherwise it has no value… or it’s “under water.” Thus, if the stock were trading at $17 per share, and he had vested in all 225,000 shares, the total profit of those shares would be $2.23 per share x 225,000 shares or a little over $500,000. Not 225,000 shares x $17 (or nearly $4 million as the post would have you believe).
As for the other stock awards, those are in the form of Restricted Stock Units (RSUs). You will see that Justin was granted 375,000 RSUs. RSUs are typically given to senior executives to retain them with an organization and also ensure that a CEO has ownership in the company. In order for Justin to receive any value, he has to stay with the company through a series of vesting dates. In his case, one third of the award vests equally over the three-year period.
Terry Jimenez’s compensation package works the same way. As does Ross Levinsohn’s.
Comparing the past three years of equity grants with the two executives identified in the Guild post, as reported in their companies’ proxies, shows that Justin makes far less annually than either Mark Thompson (at $5.406 million) or Robert Dickey (at $6.656 million).
Additionally, the two executives mentioned above both receive a much higher annual cash compensation (base & bonus) package than Justin.
Again, keep in mind that Justin’s stock compensation is meant to cover a three-year period, whereas these other executives receive grants every year.
Like many public companies, executive payouts tied to company performance have proven key to overall company growth. Since the appointment of Justin, tronc’s stock price has increased 240% to today’s $17.31 per share. We pay our executives well and in line with others in comparable positions within the industry, because we know that growing the company is critical to our ability to serve our customers.
Since Justin’s current compensation package reflects both his annual cash compensation and three-year equity compensation, his 2017 reported compensation in next year’s proxy statement will be more than 80% less than his 2016 reported compensation.
Justin received a one-time taxable moving package that sought to cover moving, selling and temporary housing costs. Again, misleading and factually inaccurate information undermines the mission we all seek to uphold.
______
Q: How much has Tronc spent to date in 2017 on consultants, attorneys and staff or contractors retained to discourage labor organizing among the Los Angeles Times’ editorial workforce?
A: The choice to organize the LA Times newsroom or not rests solely with the employees of the newsroom. We will continue to educate newsroom employees on the facts around unionizing.
______
Q: Is the “others” you’re referring to here the executives whose pay has ballooned by 80% from 2015 to 2016? ‘Also, if salaries are indeed adjusted, there could be cuts and reduced benefits for others.’
A: The executive pay you reference predates the arrival of new leadership at the LA Times. When other newsrooms have unionized, in some cases salaries have been adjusted so that some employees’ wages increased, while others’ decreased.
Q: I’ve worked at this company five years and it takes more than three months to see in my bank account the amount of money it costs to fly Michael Ferro on a private jet for an hour. How do you justify this? How do you expect me to see a bright future at this company under these circumstances?
A: Although it is very common for union organizers to raise questions about executive salaries and corporate expenditures during an organizing campaign, even if voted in, the union will have absolutely no say or influence on such issues through the union contract or otherwise.
tronc believes that its executive travel expenditures have been reasonable and appropriate for a business of its size and with its nationwide operations. In addition, the Audit Committee of tronc’s Board of Directors regularly reviews, and its approval is required for, all expenditures related to private jet transportation used by officers and other executives for tronc business. Moreover, tronc has always been transparent about such expenditures, including making all required public filings with the U.S. Securities and Exchange Commission.
______
Q: Would a union restrict members and non-members from filling in for one another? For example, a reporter covering an editing shift, or an editor writing a story?
A: A large part of what distinguishes our reporting, particularly our coverage of breaking news, is the flexibility supervisors have to put the right people on the right stories, allow reporters to work from different locations and focus on producing high quality journalism. Many union contracts restrict supervisors from filling in for a union member and vice versa. If a union is elected, these terms and conditions will have to be negotiated.
______
Q: How will going to a diversity conference help you de-Center white maleness?
A: Community is at the core of our business. Our culture reflects the wide range of audiences we serve, the diversity of our brands, and the talent that create, distribute and monetize our exceptional journalism. We believe in creating an environment where employees experience a sense of belonging, are respected, valued and appreciated, and where there is collaboration and trust between colleagues. Over the past several years, the LA Times has made increasing diversity within our newsroom a top priority, to better serve the community we cover. Each year we make progress on this goal. More than 36% of our editorial staff is non-white. That’s more than two times better than the average newsroom (ASNE survey estimates 16.55% of newspaper workforce is minority). It is currently 58% male and 42% female. We have also maintained a program designed to develop young journalists and increase newsroom diversity, Metpro, for more than 33 years. We are actively working to recruit and promote reporters, critics and editors from more diverse backgrounds.
______
Q: How does leadership plan on leading a newsroom with such low morale and no current proof things will get better as news comes out of increased executive salaries and more threats of layoffs?
A: We can’t control what happened in the past—but, together, we can work to make the relationship between management and staff better. Lewis and all of the leaders at the LA Times are committed to transparency and communication with the newsroom employees who form the bedrock of the paper. Both Lewis and Ross have already held multiple discussions with the entire newsroom and smaller groups of journalists. Going forward, we are working to create other vehicles to engage in dialogue and continue to work with you to continue to make the LA Times a news organization that is a leader in our field.
______
Q: Why have you told people the company can’t give out raises because of the union? That's objectively false. You just can’t give a raise and then ask someone to vote against it?
A: We have never said that the company can’t give out raises because of the union. Instead, we have said that raises are not guaranteed, which is a fact.
______
Q: Have you hired anti-union consultants, and if so who are they and how much have you paid them?
A: We have not hired “anti-union” consultants.
______
Q: In Jim Kirk’s email, he mentioned there was an LA Times union eight years ago and those members lost their matching 401k and received no salary increase. What type of union was this and for what type of workers did it represent ie: printers, truck drivers, dock workers?
A: The employees who operate the pressroom for the Los Angeles Times currently belong to the International Brotherhood of Teamsters, Local 140.
______
Q: The Times was once known throughout the industry -- and by its readers -- for its unflinching coverage of the Times itself, which we covered as diligently, honestly and critically as we covered any institution. What is the thinking behind abandoning that honorable part of our tradition and legacy? Doesn't it undermine our integrity?
A: The Los Angeles Times’ stellar reputation comes from providing the kind of quality journalism that defines our newspaper, regardless of the subject of that coverage. We will not only continue that legacy, but build and bolster it going forward.
______
Q: I've heard Times' management recently refer to a company-wide 2.5% pay raise in July 2016. I received no such raise, and am fairly certain that others didn't. Are we eligible for a retroactive raise now? If not, can the company please stop referring to an across-the-board raise that did not take place? Thank you.
A: Just last year there was a 2.5% performance-based merit pool across all editorial departments within tronc with the exception of unionized editorial departments, specifically Baltimore Guild. More than 80 percent of LA Times newsroom staff received wage increases.
______
Q: There’s a widespread belief in the newsroom that Lewis was deceptive at both all-hands meetings about his handling of Disney. People responsible for Disney coverage have told colleagues that despite his denials at those meetings, Lewis made the decision to kill two stories -- one a reported piece and one a Kenneth Turan column. The prospect of the editor in chief of The Times lying to his journalists twice about an ethical issue is deeply troubling and in the estimation of many of us, a fireable offense. Please respond.
A: What Lewis said to the editorial staff was true. He has not killed any story on any topic since becoming editor-in-chief on Nov. 1. To be absolutely clear: Lewis has not killed any reporting, commentary or coverage of any kind related to Disney.
Newsroom employees have asked a number of questions about unionization and other matters through an anonymous Q & A link. Some questions were asked multiple times and, in those cases, we have provided one answer below. We will provide answers to the additional questions we received early next week. This site will be updated with answers as additional questions are submitted.
Q: Why do we have a EIC, Executive Editor, President and Publisher?
A: The company leadership is dedicated to bringing on the best talent to build on the successes of the LA Times while adapting and flourishing in a rapidly changing media environment. That is the premise from which we have made strategic talent decisions to date and how we will make talent decisions in the future.
Q: Why did we go so many years with a single cost of living increase? Our competitors have consistently provided cost of living increases despite the state of the industry?
A: Just last year, we awarded a 2.5 percent performance-based raise across all tronc editorial departments with the exception of our News Guild unionized employees, specifically in Baltimore and Chicago. More than 80 percent of LA Times newsroom staff received wage increases. Though we can’t speak to salary levels at other news organizations, the news industry faces significant challenges to meet a changing media landscape as evidenced by the significant reductions at some newsrooms across the country and the wholesale closing of other outlets in just the last few weeks. The leadership of The Times is confident in its plans to meet those challenges and is fully committed to continue bolstering the Times’ stellar reputation for providing the kind of quality journalism that defines our newspaper. We will continue to share those plans with the hard-working members of our newsroom who form the backbone of that journalism excellence.
Q: What is the compensation of the current masthead members? How frequently have these masthead members gotten raises?
A: Other than certain executive officers whose compensation we are required to disclose by law the Company does not disclose the compensation of any of its employees.
______
Q: Why is Tronc CEO Justin Dearborn’s compensation $3 million more than that of New York Times CEO Mark Thompson, whose company has revenues similar to ours but a market value many multiples of Tronc’s?
A: Quoting a number out of context doesn’t tell an accurate, fact-based story. Like most public company executives, the vast majority of the compensation is awarded in the form of stock ($6.9 million of the $8.1 million). The $6.9 million represents a theoretical value at some time in the future, and is tied directly to how our stock performs.
Our senior executives are compensated similarly to others at comparable companies. In fact, we work closely with external compensation consultants to ensure we fit within basic guidelines for our industry. Justin, like similar executives here and throughout the industry, has a base salary, a bonus and is granted equity. Both the bonus and equity are closely tied to overall company performance.
Justin’s equity compensation was granted to cover a three-year period and is not an annual equity grant. The equity vests equally over a three-year period.
So how does equity work? Let’s start with stock options. A stock option is simply the right to buy tronc stock at today’s price (the “option price”) sometime in the future. Justin received the 225,000 stock options at $14.87 per share. That means that at some point in the next seven years, Justin has the opportunity to purchase 225,000 shares of tronc stock for $14.87 per share, should he remain employed during the vesting period. In order for the stock option to have any real value, the stock price has to be above $14.87 per share– otherwise it has no value… or it’s “under water.” Thus, if the stock were trading at $17 per share, and he had vested in all 225,000 shares, the total profit of those shares would be $2.23 per share x 225,000 shares or a little over $500,000. Not 225,000 shares x $17 (or nearly $4 million as the post would have you believe).
As for the other stock awards, those are in the form of Restricted Stock Units (RSUs). You will see that Justin was granted 375,000 RSUs. RSUs are typically given to senior executives to retain them with an organization and also ensure that a CEO has ownership in the company. In order for Justin to receive any value, he has to stay with the company through a series of vesting dates. In his case, one third of the award vests equally over the three-year period.
Terry Jimenez’s compensation package works the same way. As does Ross Levinsohn’s.
Comparing the past three years of equity grants with the two executives identified in the Guild post, as reported in their companies’ proxies, shows that Justin makes far less annually than either Mark Thompson (at $5.406 million) or Robert Dickey (at $6.656 million).
Additionally, the two executives mentioned above both receive a much higher annual cash compensation (base & bonus) package than Justin.
Again, keep in mind that Justin’s stock compensation is meant to cover a three-year period, whereas these other executives receive grants every year.
Like many public companies, executive payouts tied to company performance have proven key to overall company growth. Since the appointment of Justin, tronc’s stock price has increased 240% to today’s $17.31 per share. We pay our executives well and in line with others in comparable positions within the industry, because we know that growing the company is critical to our ability to serve our customers.
Since Justin’s current compensation package reflects both his annual cash compensation and three-year equity compensation, his 2017 reported compensation in next year’s proxy statement will be more than 80% less than his 2016 reported compensation.
Justin received a one-time taxable moving package that sought to cover moving, selling and temporary housing costs. Again, misleading and factually inaccurate information undermines the mission we all seek to uphold.
______
Q: How much has Tronc spent to date in 2017 on consultants, attorneys and staff or contractors retained to discourage labor organizing among the Los Angeles Times’ editorial workforce?
A: The choice to organize the LA Times newsroom or not rests solely with the employees of the newsroom. We will continue to educate newsroom employees on the facts around unionizing.
______
Q: Is the “others” you’re referring to here the executives whose pay has ballooned by 80% from 2015 to 2016? ‘Also, if salaries are indeed adjusted, there could be cuts and reduced benefits for others.’
A: The executive pay you reference predates the arrival of new leadership at the LA Times. When other newsrooms have unionized, in some cases salaries have been adjusted so that some employees’ wages increased, while others’ decreased.
Q: I’ve worked at this company five years and it takes more than three months to see in my bank account the amount of money it costs to fly Michael Ferro on a private jet for an hour. How do you justify this? How do you expect me to see a bright future at this company under these circumstances?
A: Although it is very common for union organizers to raise questions about executive salaries and corporate expenditures during an organizing campaign, even if voted in, the union will have absolutely no say or influence on such issues through the union contract or otherwise.
tronc believes that its executive travel expenditures have been reasonable and appropriate for a business of its size and with its nationwide operations. In addition, the Audit Committee of tronc’s Board of Directors regularly reviews, and its approval is required for, all expenditures related to private jet transportation used by officers and other executives for tronc business. Moreover, tronc has always been transparent about such expenditures, including making all required public filings with the U.S. Securities and Exchange Commission.
______
Q: Would a union restrict members and non-members from filling in for one another? For example, a reporter covering an editing shift, or an editor writing a story?
A: A large part of what distinguishes our reporting, particularly our coverage of breaking news, is the flexibility supervisors have to put the right people on the right stories, allow reporters to work from different locations and focus on producing high quality journalism. Many union contracts restrict supervisors from filling in for a union member and vice versa. If a union is elected, these terms and conditions will have to be negotiated.
______
Q: How will going to a diversity conference help you de-Center white maleness?
A: Community is at the core of our business. Our culture reflects the wide range of audiences we serve, the diversity of our brands, and the talent that create, distribute and monetize our exceptional journalism. We believe in creating an environment where employees experience a sense of belonging, are respected, valued and appreciated, and where there is collaboration and trust between colleagues. Over the past several years, the LA Times has made increasing diversity within our newsroom a top priority, to better serve the community we cover. Each year we make progress on this goal. More than 36% of our editorial staff is non-white. That’s more than two times better than the average newsroom (ASNE survey estimates 16.55% of newspaper workforce is minority). It is currently 58% male and 42% female. We have also maintained a program designed to develop young journalists and increase newsroom diversity, Metpro, for more than 33 years. We are actively working to recruit and promote reporters, critics and editors from more diverse backgrounds.
______
Q: How does leadership plan on leading a newsroom with such low morale and no current proof things will get better as news comes out of increased executive salaries and more threats of layoffs?
A: We can’t control what happened in the past—but, together, we can work to make the relationship between management and staff better. Lewis and all of the leaders at the LA Times are committed to transparency and communication with the newsroom employees who form the bedrock of the paper. Both Lewis and Ross have already held multiple discussions with the entire newsroom and smaller groups of journalists. Going forward, we are working to create other vehicles to engage in dialogue and continue to work with you to continue to make the LA Times a news organization that is a leader in our field.
______
Q: Why have you told people the company can’t give out raises because of the union? That's objectively false. You just can’t give a raise and then ask someone to vote against it?
A: We have never said that the company can’t give out raises because of the union. Instead, we have said that raises are not guaranteed, which is a fact.
______
Q: Have you hired anti-union consultants, and if so who are they and how much have you paid them?
A: We have not hired “anti-union” consultants.
______
Q: In Jim Kirk’s email, he mentioned there was an LA Times union eight years ago and those members lost their matching 401k and received no salary increase. What type of union was this and for what type of workers did it represent ie: printers, truck drivers, dock workers?
A: The employees who operate the pressroom for the Los Angeles Times currently belong to the International Brotherhood of Teamsters, Local 140.
______
Q: The Times was once known throughout the industry -- and by its readers -- for its unflinching coverage of the Times itself, which we covered as diligently, honestly and critically as we covered any institution. What is the thinking behind abandoning that honorable part of our tradition and legacy? Doesn't it undermine our integrity?
A: The Los Angeles Times’ stellar reputation comes from providing the kind of quality journalism that defines our newspaper, regardless of the subject of that coverage. We will not only continue that legacy, but build and bolster it going forward.
______
Q: I've heard Times' management recently refer to a company-wide 2.5% pay raise in July 2016. I received no such raise, and am fairly certain that others didn't. Are we eligible for a retroactive raise now? If not, can the company please stop referring to an across-the-board raise that did not take place? Thank you.
A: Just last year there was a 2.5% performance-based merit pool across all editorial departments within tronc with the exception of unionized editorial departments, specifically Baltimore Guild. More than 80 percent of LA Times newsroom staff received wage increases.
______
Q: There’s a widespread belief in the newsroom that Lewis was deceptive at both all-hands meetings about his handling of Disney. People responsible for Disney coverage have told colleagues that despite his denials at those meetings, Lewis made the decision to kill two stories -- one a reported piece and one a Kenneth Turan column. The prospect of the editor in chief of The Times lying to his journalists twice about an ethical issue is deeply troubling and in the estimation of many of us, a fireable offense. Please respond.
A: What Lewis said to the editorial staff was true. He has not killed any story on any topic since becoming editor-in-chief on Nov. 1. To be absolutely clear: Lewis has not killed any reporting, commentary or coverage of any kind related to Disney.