DMGT and Reach cut wages amid coronavirus recession

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The parent company behind the Daily Mail newspaper and the UK’s largest regional press group have both released emergency measures, including pay cuts for journalists trying to deal with the coronavirus pandemic.

Daily Mail and General Trust – the parent company that publishes the Daily Mail, Metro and Mail Online – said on Monday that staff earning more than £ 40,000 would be asked to take pay cuts of up to 26%.

But Lord Rothermere, executive chairman of DMGT, also announced that there would be a “one-time” compensation system where employees with reduced wages will receive company shares of the same value every month. Employees will be required to hold the stock until the end of the year, but if the stock price goes down by that time and they decide to sell, they will be compensated for the difference.

“As the world degenerates into a recession, we have seen and can expect a significant drop in advertising revenue; while the current restrictions have also caused a severe drop in traffic, “he said. DMGT is not a staff on leave.

Earlier in the day, Reach, the rival editor of the Daily Mirror, the Daily Express and the Daily Star, took tougher measures, including cutting wages and placing journalists under government control.

The company said the “senior” editorial and management team will face 20% salary cuts, while the rest of the staff will drop 10% as long as it doesn’t put them below salary. British vital of £ 9.30 a year. hour.

“It remains difficult to predict the duration and long-term impact of the crisis on our sector. So it’s critical that we take proactive cost action now to protect jobs and Reach for the long term, “said Managing Director Jim Mullen.

The announcement came days after company executives were rewarded for bonus plans.

Mullen and Simon Fuller, chief financial officer, together received nearly £ 290,000 in cash bonuses for the 2019 financial year, according to the group’s annual report released in late March. The two also secured £ 1.25m of stock options under a long-term incentive plan over the next five years. Reach declined to comment on the arrangements.

The group will propose to shareholders to suspend its 2019 dividend, arguing that it would be “inappropriate” to pay a dividend when it relied on the government’s job protection program to compensate staff. The company has also suspended forecasts for this year.

Several groups of British newspapers, including JPI Media, the publisher of the Yorkshire Post and Scotsman, and its rival Newsquest, which belongs to the American press group Gannett, have adopted emergency measures in the last two weeks following the pandemic, which has seriously affected publicity. and caused upheavals in the distribution of printed titles. The industry is also struggling with the cancellation of public events and live sports.

The media is also suffering from a drop in online advertising spending. There are reports that digital ad companies have used tools to prevent ads from appearing alongside stories about the disease in order to avoid charges of insensitivity. Blacklisting coronavirus stories for advertising could cost up to £ 50 million in revenue if the epidemic continues for the next three months, according to industry news agency Newsworks.

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