Furloughs Force Gannett GMs to Sidelines
Unpaid time off one strategy to trim costs, stave off staff cuts
By Michael Malone -- Broadcasting & Cable, 2/16/2009 2:00:00 AM
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SEVERE measures
The recording on a Gannett station general manager's voice mail earlier this month was jarring.
“I'll be out on furlough the week of February 2 and will not be checking voice mail,” the GM said in a terse tone. “I will not be returning calls...I apologize but by law am not allowed to do any work during my week of furlough.”
Indeed, the concept of furloughs—unpaid time off to save the company money and, ostensibly, avoid layoffs—has hit the broadcasting world. Gannett's vast newspaper holdings are ailing, and TV isn't much better; broadcasting was flat in the fourth quarter of 2008, compared to the previous fourth quarter, and is expected to be down in the mid-teens for the first quarter of 2009, according to the company.
Gannett Chairman/President/CEO Craig Dubow took the unique step of issuing a companywide memo Jan. 14 stating that most U.S. employees—including Dubow—will be furloughed for a week during the first quarter. “I understand I have asked a great deal of you,” he wrote, “and I regret adding to your burden with this program.”
SEVERE measures
With the economy in deep doldrums, and no Olympics or election races to bolster station coffers anytime soon, broadcasters are taking severe steps to decrease spending. Raycom, for one, laid off a significant number of staffers in December. Media General cut broadcast expenses 10% in the fourth quarter last year, primarily from layoffs. Gannett itself has tried the downsizing route, reducing staff 10% in late October, though that was on the newspaper side. “Virtually all legacy media companies have taken unprecedented short-term financial measures,” says Frank N. Magid TV President Steve Ridge, “some less publicly than others.”
Yet Gannett appears to be the first to implement furloughs; neither multiple TV consultants nor an NAB spokesperson could think of another example in the station business. Gannett staffers have kindred spirits in California state employees—Gov. Arnold Schwarzenegger has mandated rolling furloughs for them until June 2011.
As the GM's voice mail states, furloughed employees are legally barred from handling even a single work-related phone call or e-mail. Gannett's furloughs do not cover union employees, which represent around 12% of its workforce. In his memo, Dubow said unions will be asked to participate, and spokesperson Tara Connell reports numerous union employees have done so—many as a show of solidarity with their non-union colleagues.
While the furloughs are only planned for the first quarter, Gannett management is keeping open the possibility of requiring them in future quarters, and layoffs might still occur. “I can't say for sure [furloughs] won't happen again,” Connell says. “One other quarter is a possibility, but it all depends on revenue.”
A few hard-hit Gannett markets appear to be exempt from the furloughs, instead slashing costs through severe payroll cuts. None of nearly a dozen Gannett general managers contacted would speak on the record about furloughs, for fear of angering corporate. But most seemed to think their stations would do just fine with the boss on the beach for a week, especially with the DTV switch put off until summer.
“If we don't have an organization that can operate smoothly without the general manager for five days, then something's wrong with the organization,” said one exec. “If you have good department heads and managers, they'll do a good job whether the quarterback is in the game or not.”
Dubow said furloughs were “the fairest and least intrusive way to meet these fiscal challenges,” and several GMs say staffers agree. “Nobody likes it, but I can honestly tell you that it's gone over very well in the company,” said one. “If this helps protect somebody's job, people support it.” Some even speak of how the program has caused staffers to band together in the name of shared adversity.
Yet several GMs outside Gannett found the notion of a general manager not being connected to the station's day-to-day affairs for such a spell inconceivable. Even if they're on vacation for a week, say the GMs, they're still keeping an eye on the BlackBerry. “When you run a television station, you're hooked up 24/7,” says WGHP Greensboro. N.C., President/General Manager Karen Adams, who competes with Gannett's WFMY. “Whether you're a GM, a news director, a reporter, this isn't the kind of business where you do it, then go home and tune out.”
Some Gannett GMs, used to managing all aspects of the business, are curious to see how they'll hold up during their mandated vacation. “It'll be a learning thing for us,” says one, who hopes to avoid what he jokingly calls a “severe physical reaction” to not running a TV station.
E-mail comments to michael.malone@reedbusiness.com
