'UPI Ultimatum'

Here's a story by George Garneau from the Oct. 31, 1987 edition of Editor & Publisher:


United Press International management, in what appears to be its toughest test since its revival from bankruptcy, has set a showdown with its union and is fueding with its top news executives.

Federally mediated talks were planned with the Wire Service Guild just days before the Nov. 1 deadline UPI set to impose terms sharply curtailing the power of the union that represents 850 journalists and other employees.

UPI declared an impasse Oct. 22 and said it would "unilaterally implement" its "final" proposal 10 days later -- with or without union acceptance.

Negotiations started last March to replace a contract that expired April 30.

Union leaders told the membership that management negotiators indicated the company was considering layoffs of 300 to 500 employees.

Kevin Keane, president of the Wire Service Guild, called UPI's plan "unacceptable" and "a recipe for disaster."

Hedging about the possibility of a strike, he said management's proposal would not go to a vote, but union members would decide on their options at the deadline.

As the deadline day drew near, Guild leaders called for a byline boycott and planned to set up informational pickets during lunch hours outside UPI offices.

UPI spokesman Christopher Smith, when asked about a strike, said UPI was "prepared to meet that if it comes to it," but that it was not expected.

"Neither the Guild nor UPI could afford a strike," Smith said. "This is a company that could disappear into the night if the decide to be hardnosed about it. It would be kind of killing the goose that lays the golden egg."

Smith asserted that management was not trying to provoke a walkout.

"We're not talking strike. We're trying to talk about some kind of compromise solution," said Charles Dale, president of the Newspaper Guild, the Wire Guild's parent union. "A strike would hurt UPI with its clients and would not be in our best interests at this stage."

A strike vote had not been taken as E&P went to press, with news managers said to be meeting with their bosses to smooth rifts, and with management scheduled to meet with the Guild and union members to decide their next moves.

A service-disrupting strike could cripple the struggling news agency by further eroding a client base already weakened by newspapers' cancellation of service during the fiscal uncertainty that landed UPI in bankruptcy in 1985.

It was rescued the following year by the current owner, Mexican publisher Mario Vazquez Rana, who bought it for $41 million. Vazquez' minority partner in the transaction was Houston developer Joe Russo, who has not been actively involved in the running of the service.

UPI's current labor confrontation is the latest in a long line of upheavals to threaten the money-losing news service. Following a brief revival period when Vazquez first took over, UPI has suffered further cancellations, losses estimated at more than $1 million a month, and there have been revolving doors in the news and business management offices.

Chief editor Ben Cason and managing editor for national news Barry Sussman, both hired from the Washington Post last January, were said by several sources to have developed "serious differences" over editorial staffing, news coverage and budgeting.

On several occasions, one source stated, the two top editors have threatened to quit. Neither could be reached for comment on the widely circulated reports, but UPI spokesman Smith did not deny that there have been some disagreements.

Tom Winship, the former Boston Globe editor who sits on UPI's editorial review board, said he would discuss with other board members whether the "disagreements have infringed on the quality of the editorial product."

Management's last offer, according to Keane of the Guild, is designed "to take everybody out of the union and strip control from the few that would be remaining."

Smith said UPI planned no layoffs and was not trying to displace Guild workers. He said management is seeking "the ability to manage the company the way other companies are managed. Now it's very restrictive."

Vazquez, who was in Mexico City and not available for comment, was said to have approved UPI's ultimatum to the union, which was made "at his direction."

Among the terms UPI said it will impose:

** UPI will become an "open shop" where employees can choose whether to join the union.

** Management will be able to contract work to non-union workers at its discretion. Management will be able to determine the size and composition of the work force in job classifications and in bureaus, without limit by current contractual stipulations.

** Management will be able to fire employees it determines are incompetent. Employees can appeal to a management-established board, before which they must prove their competence.

** A 14.5 percent pay raise over two years for workers with seven years' experience, about 70 percent of the work force, bringing the top minimum pay from $590 to $670 a week.

** Health benefits will improve and cost employees less, UPI said. Pension benefits will double, and other benefits would be established.

"They are asking for massive givebacks," said union negotiator Dan Carmichael.

News department reorganization

Smith of UPI said plans are in the works for a "significant" reorganization of the news department, involving cuts in European staff and beefed-up U.S. sports and political coverage.

He conceded the changes could mean a loss of jobs and significant shifting of personnel, but he said UPI is not looking to get rid of people, only seeking to use existing staff better.

"We really feel we run very inefficient operations now, and our hands are tied tight in being able to change things around," Smith declared.

Smith noted UPI has added 60-70 editorial staffers in the past year.

About 100 administrative employees signed a similar contract earlier this year, Smith pointed out.

According to the Guild, UPI employees, after the gradual restoration of sharp pay cuts, are early only 5 percent more than they made in 1984. They average at least $100 a week less than their counterparts at the Associated Press, the union said. The union had been asking for $1,000 a week and provisions for job security.

Money has faded as an issue with the threat of imposed terms of employment. The imposed terms essentially would eliminate the union and collective bargaining.

They have become a growing reality for the Newspaper Guild after recent experiences at the Washington Post and Baltimore Sun.

The Wire Service Guild has denied there is an impasse and said there will be no agreement until there is a complete agreement.

In other developments, Clay Richards, one of UPI's top political reporters, has ended a long career with UPI to join Newsday in New York.

Union sources have pointed to the recent return to UPI of Claude Hippeau as an executive vice president as an indication management was preparing to buffer in case Cason and Sussman leave.

Cason and Sussman did not return calls to E&P and continued calls to Hippeau resulted in return calls to E&P by UPI spokesman Smith.