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As digital media companies brace for change, unions try to cushion the blow

Newly formed unions have been warning employees that winter is coming. Now that it has arrived, what can a union actually do about it?

A 2007 writers’ strike was led by WGAE, a union that represents many digital media companies.
Bryan Bedder / Getty

2018 has been a bumpy year for digital media publishers. Several newsrooms have had to downsize, restructure and, in some cases, sell or shut down altogether.

2019 could be worse.

Which is exactly the scenario union advocates spelled out as they organized digital publishers — including Vice, Gizmodo Media Group and Recode parent company Vox Media — over the last few years. If times got tough, the argument went, workers who joined a union would have an advocate and some protection.

Now that winter has arrived, these unions are being called upon to live up to their promises. So far, they seem to be delivering some relief to employees affected by cuts. But unions have their limits.

In theory, the most important power unions offer employees in times of turmoil is a seat at the table. That means that in the case of downsizing, merger or sale, management is obligated to negotiate in good faith with members of the union’s bargaining committee to minimize the impact to workers.

That committee is typically comprised of a group of unionized employees at the company who negotiate on behalf of their colleagues. A representative from either Writers Guild of America East or NewsGuild, the two largest national unions representing digital media companies, can help workers in negotiations. Sitting across the table are representatives from management. Each side typically also brings legal counsel to lead the discussions.

It’s easier for unions to negotiate if they already have a collective bargaining contract in place with the employer. If that’s the case, then there’s a standard procedure for what happens when a company has to let go of employees, sell or restructure.

For example, in the case of layoffs, the contract often predetermines conditions such as how many weeks or months of severance employees will get and how long they’re covered by health insurance.

If management has recognized a union but hasn’t yet to agree to a contract, then the negotiations can get more complicated because management has to make a one-off deal with the bargaining committee.

That’s what happened at millennial-focused digital news publication Mic, which sold to Bustle Digital Group last month and whose union has been through weeks of bargaining for things like severance pay. Similarly, Vox Media’s bargaining committee has made negotiations with management over terms of layoffs, even though the union does not yet have a contract in place with the company.

In Mic’s case, since the company was short on cash and therefore sold at a fraction of its valuation, there’s only so much financial compensation for employees the union can bargain for.

Nastaran Mohit, an official with the NewsGuild of New York, which represents former Mic employees, wrote in an email to Recode, “The financial situation at the company was even worse than was reported, and the Guild has spent the last several weeks extracting every dollar possible.”

The union has also publicly criticized the company’s handling of the sale to Bustle Digital Group, accusing Mic of union busting since it laid off all of its unionized staff. If that claim has merit, the union could file a charge with the National Labor Relations Board, the NLRB, which could take punitive measures against Mic, including forcing the media company back to the bargaining table with the union.

Sometimes, in best-case scenarios for employees, unions can help avoid layoffs altogether by negotiating organizational restructuring or voluntary buyouts instead.

When Gizmodo Media’s new parent company, Univision, initially wanted to lay off 30 percent of the editorial staff, the union successfully bargained for voluntary exits instead. The parties agreed on buyout packages for close to 20 percent of editorial staff members. Those packages included 18 weeks of pay and healthcare.

“It’s a great tangible example of what your union can do, and it’s important that people know we were able to do this just because we put our minds to it,” said Hamilton Nolan, senior writer at Splinter, a Gizmodo site. “Given the fact we’re living in an era where there’s going to be a lot more media consolidation, sales and spinoffs, a union contract is going to go a long way toward making your life easier if you do find yourself in that position.”

But there are limits to unions’ powers. A union can’t prevent a media company from going under or stop a merger from happening. In the case of a merger between two companies, usually the buyer will recognize an existing union, but in the case of an asset sale they might have to renegotiate a contract from scratch, according to Lowell Peterson, executive director of WGAE. Peterson said, however, that in the cases of digital media mergers his union has helped negotiate so far, the contract has stayed in place.

And in the case of an asset sale where the company meaningfully changes its business — like a spinoff to a company in a different industry — there’s a chance the union could be dissolved altogether. What’s worse, there’s virtually no union protection if a company completely shuts down. This means, though, that the company can’t sell to another company or relaunch the business in any way after closing.

“Like with any industry, being unionized isn’t a silver bullet,” said Rebecca Givan, an associate professor of Labor Studies and Employment Relations at Rutgers University, “It can’t fix a failed business model.”

Some media publishing executives, meanwhile, argue — usually off the record — that unions can work against their workers, since a unionized company may be less attractive to buyers. That’s because doing things like guaranteeing a minimum salary across the board or offering generous severance packages can be viewed as taking cash out of business operations. That said, Recode couldn’t find any examples of M&A deals in digital media that fell through because of a union.

Some media founders, who say they’re supportive of unions in general, have publicly shared why they disagree with it at their own companies.

As a flurry of competing newsrooms were beginning to organize in 2015, BuzzFeed CEO Jonah Peretti said in a staff meeting that a union “isn’t something I think would be great for the company,” and that the relationship between management and employees “is much more adversarial” with a union involved. Last year, at another staff meeting, he voiced similar concerns.

When employees at the once fast-growing VC-backed digital media company Upworthy were attempting to organize in 2015, co-founder Eli Pariser discouraged the efforts, writing that a union “could come at a cost to the company in terms of our ability to raise capital.”

Upworthy didn’t end up unionizing. In August, the company laid off 31 employees.

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