Que$tion$ and An$wer$
on COMPEN$ATION

What exactly does a “wage freeze” mean?
It’s important to know exactly what the Times’ proposal for a wage freeze means. There would be no contract or cost-of-living increases, nor any raises for the bulk of our members.
However, newer employees who are still climbing through the contract progression wage scales would continue to receive the appropriate “step increases” as they gain more tenure.
If your pay rate is completely above the top minimum on the scale, you would receive no wage increases.

How many people in the bargaining unit still have potential "step increases" within their wage classification?
About 140 people, or 23 percent of the bargaining unit, appear to have at least one "step" left on their individual wage scale. The other 77 percent of the bargaining unit (three out of every four people) are at the top of the scale and effectively "maxed out."
There is a wide variation between different departments in terms of how many people still have possible step increases. The proportion is highest in Advertising, where almost half the people (48 percent) appear to be in a position to move up at least one "step." This seems to be explained by the fact that an almost identical percentage of the Advertising work force (49 percent) has been with the company for three years or less, indicating a high rate of turnover and many new hires.
Outside of Advertising, only about 13 percent of the workforce (one person in eight) has at least one "step" left, and they tend to be newer hires in lower-paying classifications. The remaining seven out of every eight people are "maxed out."
Finally, since the wage figures these numbers are based on are several months old, a number of people probably have just taken that "final step" and joined the ranks of the "maxed out."

What about merit pay?
The Guild bargaining team has asked Times negotiators on a couple of occasions if merit increases will be available to union employees under the new contract. The answer is a decisive “don’t know.”
“Nothing prohibits it,” said Martin Hammond, labor-relations analyst, in a recent negotiations session.
We don’t know what would happen if a competitor tried to lure away a Times employee. Would the company match the competitor’s offer?
The Guild has a proposal on the table to change the contract language on merit pay. The contract currently says:

“Employees who received merit pay prior to December 5, 1983, shall continue to receive such merit pay during their term of employment. Any merit pay applied after December 5, 1983, may be removed at the Publisher’s option.”

We have proposed to get rid of the language that allows the employer to remove merit pay. So far, the Times has rejected any change. Since the company wants to hold on to the language, the Guild has asked for a list of employees who have received merit pay, and how much and when they received it.

What about “pay for performance”?
Another form of incentive pay, known as “Pay for Performance,” is described in Appendix A of the contract (page 52):

“Employees whose minimum salaries are increased due to performance increases shall continue to receive such performance increase during their term of employment, unless transferred to a job classification that does not qualify for performance pay.”

We asked about PFP in negotiations. Company negotiators told us that PFP raises haven’t been funded since the 1990s, except for some PFP increases granted to news employees in 2001 and 2002.
How do you know whether a raise you received in the past was PFP or merit pay? Good question. It’s part of the information we asked the Times for. It’s important to know the difference, since PFP under most circumstances remains part of your base wage.

What about incentive payments and commissions?
Nothing in the current contract negotiations would change the incentives and commissions earned primarily by Advertising and Circulation employees. The Guild and the Times have agreed to add language on goal-setting to the contract.
But for those who don’t regularly read the contract, this is what it says about incentives and commissions:

• Article 8.4.1—Unless otherwise committed within the terms of this Agreement, it is understood the Publisher may add, modify or eliminate all forms of incentive payment as the Publisher determines is necessary.
• Article 8.4.2—During the life of this Agreement, the Publisher will not reduce the potential incentive pay available to advertising and circulation employees under monthly and quarterly incentive plans.
• Article 8.4.3—Incentive plans will be administered fairly and equitably. Appeals or concerns under this subsection are not subject to the grievance and arbitration provision of this Agreement.

What about the wage diversion for medical? With a wage freeze, won’t we likely see our wages decline as the medical diversion inevitably increases?
The Times isn’t going so far as to say that a wage-diversion increase is inevitable, but they do say it’s probable. And if you look at the numbers since 2001 you’ll find that we have had increases four out of the past five years. (In 2004, there was actually a 2 cent an hour decrease in cost due to a one-time savings achieved by a change in plan structure.) In the four years in which we had increases, the average was roughly 10 cents an hour per year, and has produced a total increase of approximately 39 cents per hour over the course of the current contract. The current total wage diversion is 99.76 cents (about a dollar) per hour. If you’re full time, that’s $80 coming out of each paycheck.

If these trends hold, over the next two years Guild employees will be looking at an average increase in the medical diversion of roughly 10 cents per hour per year. This would raise the cost to $96 out of each paycheck for full-timers by year two.

In other words, based on these numbers and the company’s no-increase wage proposal, it is likely we could be looking at an actual wage cut of 20 cents per hour over the next two years.