Wire Service Guild Posting (April 4, 1985)

Here's a "special bulletin" posted by the Wire Service Guild on April 4, 1985 -- just prior to the company's filing for Chapter 11 Bankruptcy protection:


(Please Post on Guild Bulletin Boards)

Wire Service Guild leaders have been meeting with top-level UPI executives for the past two days to discuss the company's efforts to produce a recapitalization plan designed to keep UPI in business.

The situation is very complicated and murky. Many parties and many agendas are in contention.

First, the union has agreed to no further concessions. It is clear that the company desires further concessions. But, the union will not even discuss the matter until it receives a vast amount of requested information.

UPI already has provided, and the union is analyzing, UPI tax returns, staffing levels, expenditures, assets, liabilities, equity positions and projected expenses.

Further, the union has pointed to a number of areas -- outside of Guild jurisdiction -- where it believes that is "fat," including a top-heavy management structure and too many consultants.

Also, the union has informed UPI that UPI will honor its August 1984 wage concession agreement. That means that as of midnight Sunday, your paycheck rose from 85 percent to 90 percent of August 1984 wage levels. While the company continues to push for wage and other concessions, it has acknowledged that it must pay the high wages in upcoming paychecks.

At the first meeting of the new UPI Board of Directors in Washington Tuesday, union president William Morrissey, who is one of the four members of the new board, urged that the company's recapitalization program place top emphasis on editorial excellence and expansion -- at the expense of reduced overhead and administrative costs.

The proposed plan is expected in about three weeks for consideration by the directors.

As you undoubtedly are aware, UPI has named an editorial task force to identify staff cuts if believes are necessary.

In the event of layoffs, the company must give the union and the affected employees four weeks written notice. So far, no notice has been given. Cuts must be made in inverse order of seniority within bureaus or departments. Premium dismissal indemnity must be paid.

The union's understanding is that the company has not reached any firm decision on this matter.

Meaning, the picture is further complicated by a top-level UPI power struggle. It pits Luis Nogales, chairman and chief executive officer, against UPI co-owners Douglas Ruhe and William Geissler.

It is true that Ruhe and Geissler are attempting to sell their 33 percent of UPI. Those efforts began without the knowledge of either the union or UPI's top management.

Ruhe and Geissler contend they have the right to sell their portion of the company. Nogales and his management team contend Ruhe and Geissler do not -- and that such moves undermine the effort to recapitalize UPI.

The dispute does not involve the union. It is a contractual matter between Ruhe-Geissler and Nogales. But union leaders have been meeting privately with both sides, urging an amicable solution.

Nogales said today he expected to issue a statement to the staff within a few days as to what action he will take in the dispute.

The union's position is simple: To stay out of a possible legal battle over the Ruhe-Geissler and Nogales contract, urge a resolution to the dispute, and to promote employee concerns.

The union will keep its members informed as to the situation as developments become more clear.

The union has been represented in the Washington meetings by Morrissey and secretary-treasurer Dan Carmichael.

UPI has been represented by Nogales, new president Ray Wechsler and Bobby Ray Miller, vice president of labor relations.