G.M. Corrigan, The Examiner
2007-04-17 07:00:00.0
Current rank: Not ranked

BALTIMORE -

All employees are equal, but some employees are more equal than others.

According to a Securities and Exchange Commission filing outlining Chicago-based Tribune Co.’s $8.2 billion proposed buyback of the publicly traded company — owner, among other media properties, of The Sun newspaper — unionized employees are excluded from the new, tax-exempt employee stock ownership plan.

The complex $34 per share deal, proffered by Chicago real estate mogul Sam Zell and recently accepted by Tribune Co.’s board, would reserve 52 percent of company stock for the ESOP, 8 percent as “phantom stock” for executives and other employees, and a warrant for 40 percent for Zell that he could exercise at a beginning price of $500 million.

“We’re not in it,” said Washington-Baltimore Newspaper Guild President M. William Salganik, who is also a business reporter for the guild-represented Sun. “It explicitly says union-represented people are not included — which I think they have to put there, since, if we were included without bargaining with us first, we’d be filing a charge.”

“But that still leaves open the question of whether they want us in or out,” Salganik said. “But we’ll find out at bargaining.”

Echoing Salganik, Sun Director of Marketing and Communications Linda Yurche said the unionized member exclusion was “not anything unusual,” since ESOP participation was a matter for collective bargaining.

Salganik said the guild’s current collective-bargaining agreement with The Sun expires June 24 and that the 500 guild-represented employees at the 1,550-employee company are expecting to bargain, but not necessarily over ESOP participation.

“There are advantages and disadvantages [to participation],” Salganik said. “The disadvantage is that a fair chunk of your retirement benefit is tied up in company stock ... which even with a financially secure company is not a good idea — which we learned from Enron. And this is a company with a very heavy debt load.”

Newspaper Guild-Communications Workers of America Secretary-Treasurer Bernard Lunzer said, however, that he would like The Sun’s unionized employees included in the ESOP, and Theodore Venetoulis, spokesman for a local group interested buying The Sun, expressed surprise at the union-excluding ESOP.