Fairfax joint-venture sheds staff as suburban profits dive

Numerous redundancies are looming inside Fairfax’s Victorian joint venture Metro Media Publishing as the company moves to rein in costs on struggling community mastheads formerly controlled by the ailing media giant.

Staff from Metro Media’s central office, located in South Melbourne, are being called in for meetings to discuss the changes, involving relocations, redundancies and reductions in working hours. Over 20 staff out of 120 are said to be affected, with the changes focused on some unprofitable publications within the 11-masthead central group.

A senior MMP source told Crikey that more job losses were to come at the Dandenong-based east group, identified by CEO Antony Catalano last year as problem area for the merged real estate agent-owned business, for which Fairfax paid $35 million in cash and $35 million in assets for a 50% stake in December 2011.

Employees are meeting with the journos’ union the Media, Entertainment and Arts Alliance at 12.30pm today to examine their options and have been urged not to sign anything.

Catalano confirmed to Crikey that eight positions would be made redundant in the central office: “There are big challenges to the business we inherited. We’ve worked for nearly 12 months to try and turn around some of the businesses that were loss makers as part of the deal. But the reality is that some of them aren’t fixable. And that means we have to make some tough decisions. We never take things lightly when we’re dealing with individual staff and careers and we’re trying to tread carefully. But if we ignore this the rest of the business will suffer.”

Central titles include the Boroondara and Stonnington Review Locals and the profitable Weekly Review glossies spread throughout Melbourne’s affluent inner suburbs.

The Fairfax-MMP joint venture was finally bedded down last May following months of to-ing and fro-ing over the Australian Competition and Consumer Commission approval process. Crikey understands that in its submissions to the ACCC, Fairfax claimed its entire Fairfax Community Network of 33 mastheads was on the verge of being shut down with job losses in the range of 300 to 400 if the merger didn’t proceed.

Loss-making mastheads in the east grouping, which employs a total of 80 staff, are currently being examined for savings, however a decision on their future — which could include masthead closures — is yet to be made. East titles are Casey Weekly, Casey Weekly Cranbourne, The Dandenong Journal, Frankston Weekly, Knox Weekly, Monash Weekly, Maroondah & Yarra Ranges Weekly and the Peninsula Weekly.

After the Fairfax deal was done, the former FCN titles were relaunched on July 25 last year. The Melbourne Weekly, Melbourne Weekly Port Philip and Melbourne Weekly Bayside were shuttered to make way for four “Review Locals”, including the Review Local Port Phillip and Review Local Bayside, which both closed earlier this year. Over the last 12 months, MMP management discovered many titles were bleeding serious revenue to News Limited’s Leader titles and those of Paul Thomas’ Star News Group. They have remained deeply in the red.

Last October, 29 staff were made redundant from some titles in the group, with some of the work outsourced to media labour hire firm The Media Gang.

The changes add to speculation that Fairfax may be about to buy Catalano’s stake in MMP, before moving it under its newly-created “Domain” business unit. Domain would then be sold-off in the manner of New Zealand’s TradeMe, with Catalano, a former Age commercial tsar, emerging as CEO.

Two emails sent yesterday by MEAA state secretary Louise Connor, and obtained by Crikey, advises staff to sit tight and listen to what the company has to say …

URGENT: Today’s Meeting Postponed until tomorrow 12:30 30.04.2013

Dear Alliance Members and MMP Employees,

Delegates and Officials have decided to postpone today’s planned meeting for Central Staff until tomorrow. We are doing this in order for directly affected staff to hear about proposed changes to their working arrangements firsthand before we discuss the way forward collectively.

We are calling a meeting for all Central staff tomorrow at 12:30pm. Details will be forthcoming from your delegate and organiser. We want to reiterate our previous bulletin: staff are under no obligation to make decisions today and it’s the recommendation of your union to listen to proposed changes and wait until we have the chance to discuss the proposed changes collectively before responding.

Union officials (Louise and Jake) will attend the Editorial briefing tomorrow at 10am at Central and will meet immediately after this meeting with management to discuss the proposed changes. Following this, we will be holding a union meeting with all editorial employees at 12:30 to discuss how we wish to respond.

Please be aware that under the collective agreement the following clauses are relevant: 3.1 Consultation on Major Change If the Company is considering workplace changes that are likely to have a major effect on the Employees covered by this agreement, the Company will consult affected Employees and the Alliance.

If one party wishes the matter to be kept confidential, the other party will give fair consideration to that request, and if agreed it will be kept confidential. If one party does not agree to keep a matter confidential it will inform the other party of its decision in the consultation meeting. As soon as practicable the Company will discuss with relevant Employees and the Alliance the introduction of the change; and the effect the change is likely to have on the Employees.

The Company will discuss measures to avert or mitigate the adverse effect of the change on the Employees.

For the purposes of the discussion the Company will provide the relevant Employees and the Alliance in writing: relevant information about the change, including the nature of the change proposed; and, information about the expected effects of the change on the Employees. The Company, Employees and Alliance must give prompt and genuine consideration to matters raised about the major change.

As soon as a final decision has been made, the Company must notify the Employees affected and the Alliance, in writing, and explain the effects of the decision. The Company, Employees and Alliance will act in good faith in relation to the consultation process provided in this clause.

In this clause:

a) “Good faith” includes obligations to meet, disclose relevant information, genuinely consider proposals and respond with reasons, and to refrain from capricious or unfair conduct that undermines consultation.

b) A major change is likely to have a significant effect on a group of Employees if it results in: (i) the termination of the employment of Employees; or (ii) major change to the composition, operation or size of the Company workforce or to the skills required of Employees; or (iii) the alteration of hours of work; or (iv) the need to retrain Employees; or (v) the need to relocate Employees to another workplace; or (vi) the restructuring of jobs; or (vii) changes to the legal or operational structure of the employer or business which impact directly on Employees (eg change of employing entity). This consultation, in no way, diminishes or removes management’s capacity and responsibility to manage. 4.10 Redundancy In the event of a redundancy, the following payments will be made: a) Two weeks’ pay as a severance payment; and, b) Four weeks’ pay for each completed year of service as a redundancy payment; and,

c) Pro-rata payment for any incomplete year; and, d) Pro-rata Long Service Leave for five years’ or more service. For the purposes of this clause, a week’s pay is defined as ordinary pay plus penalty or shift rates for a week (averaged over the previous 6 months of employment). Penalty rates for Sunday work or shift rates shall be included in the calculation of a week’s pay if an Employee has been FCN Vic Editorial EBA 2012 10 April 2012 Page 12 of 34 earning such rates for at least the previous 6 months prior to the date of termination. A week’s pay will not include additional hours or overtime. Casual Employees are not entitled to redundancy. Employees made redundant will be provided with or will be offered professional outplacement services in the areas of resume preparation, interview preparation or skill training, and financial planning. Know your rights: Click here to access the full collective agreement.

Regards,

Louise Connor Victorian Secretary

Jake Wishart MMP Organiser

The following email was sent yesterday: