Boston Globe arrives at tentative cost-cutting deal with union

US daily The Boston Globe and its largest union, the Boston Newspaper Guild have reached a tentative agreement, ending three months of negotiations in order to keep the paper in circulation.

 Late last night, the Globe and the Boston Newspaper Guild announced a breakthrough in the negotiations, which would be ratified by the Guild members in a vote on 20 July.

The agreement hammered out between the management of the Boston Globe and its largest union will save $10 million through a smaller wage reduction of 5.94 per cent instead of the earlier 8.3 per cent cut the management had originally proposed, accompanid by deeper reductions in benefit.

The management had wanted the Boston Newspaper Guild to agree on $10 million in salary concessions or half of all union concessions of $20 million, which six other unions had agreed to.

But The Boston Newspaper Guild, that represents more than 1,200 white- and blue-collar workers, narrowly rejected the $10 million in wage and benefit cuts 277 to 265 against the new contract early this month, which subsequently led to the New York Times Co impose a 23-per cent pay cut. (See: Boston Globe's largest union rejects wage and benefit cuts)

The Boston Newspaper Guild had then filed a case with the National Labour Relations Board to block the New York Times against the cut on the grounds of unfair labour practice.

But both sides wanting to break the deadlock, went to the negotiating table to come to a settlement and last week, The Boston Newspaper Guild, postponed the hearing of the unfair labour case it had filed at the National Labour Relations Board. (See: Boston Globe's union hold back court hearing in favour of negotiations)

The Globe said that the current 23 per cent pay cut would continue to be in effect until 20 July, when the Guild members will vote on the new contract.

"Our aim throughout our negotiations has been to achieve the necessary savings in a way that causes the least hardship for our employees. We're very pleased to have reached an agreement that accomplishes those goals," Globe publisher Steve Ainsley said in a statement.

Having lost $50 million last year, The Globe has projected an $85-million loss this year.