Read The Washington Post’s buyout memo
The Washington Post is offering new buyouts to help the money-losing paper cut costs as it pursues a plan to become profitable again. You can read our story about it, along with an interview with Publisher Katharine Weymouth. Meanwhile, here are some excerpts from her memo to Post employees:
I need not tell you that our industry is undergoing a seismic shift as readers face an array of media choices and our traditional advertising and circulation bases decline. The good news is that the appetite for news is as robust as ever. Thanks to our presence on the Internet and on mobile phones and other devices, our audience includes more readers now than we have ever had. But while online revenues have been growing, they have not yet grown fast enough to offset the declines we are seeing in print revenues. As we move forward, our path is pretty straightforward: we will have to reduce our cost structure…
Below are some of the specifics on the VRIP that we plan to offer certain exempt employees in the next few weeks. We also plan to offer a similar VRIP to certain Guild-covered employees. Post representatives will be discussing the proposed VRIP with the Guild in a few weeks, consistent with the terms of the labor contract. While this VRIP is similar in some ways to the programs we have offered in the past, it will not be as generous as some of those prior buyouts.
Eligibility: To participate, exempt employees must be at least age 50, and have at least 5 years of service under The Post’s retirement plans, as of December 31, 2009. They must be full-time, or part-time averaging at least 22.5 hours a week, and must be working in one of the departments or positions specifically listed in the VRIP.
Program Specifics: Eligible exempt employees who retire under the VRIP will receive:
• A lump sum payment of up to one and a half times the employee’s salary based on years of service.
The VRIP will also offer significant enhancements to employees’ retirement benefits on a one-time basis:
• An improved retirement formula and “Rule of 80″ benefit. Eligible employees will have two possible pension enhancements and will receive the one that provides them the greatest pension benefit:
One enhancement is an improved early retirement offset factor, so that, for example, an employee can retire at age 60 with 100% of his/her normal retirement benefit.
Another possible enhancement is a “Rule of 80″ benefit – meaning that an employee whose age plus service totals 80 can retire with 100% of his/her normal retirement benefit without having it reduced by early retirement factors.
• Retiree Medical Insurance and Increased Pension Supplements. Full-time employees retiring under this VRIP will be eligible to participate in our retiree medical plans. To assist with the costs of this insurance, we will increase the pre-65 supplement in the pension plan from $3,000 to $4,000 a year, and increase the Cash Pension Supplement from $200 to $225 per year of service (up to 30 years), for exempt employees who retire under this VRIP.
The decision to participate in this VRIP is voluntary. Eligible employees will have 45 days to consider the VRIP and discuss them with their advisors, and will have seven days after they sign the required paperwork to change their minds.
We plan to schedule retirement dates as early as practical, consistent with our operational needs. In Production and Circulation where positions do not need to be replaced due to the plant consolidation, we expect most employees to retire approximately July 31, 2009. The target retirement date for all other employees will be June 30, 2009.
We will distribute VRIP packages to eligible employees in several weeks, and will include a personal fact sheet estimating each eligible employee’s benefits under the VRIP. We will provide Financial Planning Workshops in order to assist eligible employees with the decision making process. We will also have representatives in HR available to meet individually with employees to discuss their options.
I recognize that a program like this can be stressful for everyone. Thanks to everyone for your understanding and dedication to The Post as we work through this process.