GateHouse Offers Buyouts to Newspaper Employees in Arkansas

GateHouse Offers Buyouts to Newspaper Employees in Arkansas

GateHouse Media, the newspaper chain that shook up management of its Arkansas properties late last month, is now offering voluntary buyout packages to most of its employees nationwide, and other staff cuts may be in the pipeline.

The voluntary severance would give journalists who accept it by Aug. 29 one week of severance pay for every year of employment. Under the terms of the offer, employees would leave the company by Sept. 16. A memorandum about the offer was issued to employees on Tuesday by GateHouse CEO Kirk Davis.

The company, which described the buyouts as part of its "ongoing efforts across our organization to reduce costs," said that layoffs are a possibility if the voluntary program falls short. 

"In the event that a sufficient number of employees do not end up ultimately participating, an involuntary reduction in force may occur," GateHouse said in an information packet distributed to employees.

The buyout offer was not extended to several GateHouse operations, including its digital division, Propel Marketing, or its BridgeTower Media business-to-business arm, formerly called Dolan, which includes the company's business, legal, construction and political news journals.

Publicly traded Gatehouse Media LLC, headquartered in suburban Rochester, New York, owns the Southwest Times Record in Fort Smith, the Pine Bluff Commercial, the Daily Siftings Herald in Arkadelphia, the Hope Star and the Stuttgart Daily Leader, along with more than a dozen Arkansas weeklies.

The chain, which has 125 daily newspapers among its 620 publications nationwide, named Ed Graves, a former USA Weekend executive, to replace two of its Arkansas publishers in late July. Byron Tate was dismissed as publisher and editor in Pine Bluff, and senior group publisher Shane Allen, based in Heber Springs, was also ousted. 

Crystal Costa, the newly installed publisher of the Times Record and a group publisher of several smaller GateHouse papers in western Arkansas, said there was no specific target number for buyouts among her 94 employees.

"This is being done through all the GateHouse properties, and it's another attempt to look at expenses and trim costs," she said. "We're trying to rightsize, to stay on the cutting edge in the future, and to innovate and grow. This is an opportunity for employees who don't believe in that mission, or who see this as opportunity, to exit on a positive note."

Costa, who moved from the Northwest Arkansas Democrat-Gazette to become publisher at the Times Record in July, oversees weekly and twice-weekly papers in Paris, Booneville, Greenwood, Charleston, Alma and Van Buren. 

"We've done some research, and we don't have the expectation that a lot of our employees here will accept the offer. Even if they volunteer, depending on whether we can do business properly without them, the company may reject losing them," she said. 

Costa added that of her 94 employees, "22 work specifically for our weekly operations, and a handful are assigned to our corporate business operations."

When GateHouse shuffled its Arkansas management last month, Allen noted the industrywide struggle to manage print revenue declines while growing digital revenue in a tough environment. 

"I hope GateHouse and its papers can move on and be successful," Allen said.

Davis, in the buyout literature, said the company's goal is to be "revenue positive by 2018," and that while "year-to-date our revenue performance has improved and outperformed our industry peers, we continue to see revenue declines and must align our expenses accordingly."

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