Fairfax production offshoring goes ahead; talks with striking journos and unions collapse

Protests against Fairfax outsourcing plans

Fairfax is pushing ahead with plans to move scores of production jobs offshore, after talks with protesting journalists and the unions collapsed.

Fifty-six full-time production staff, spread over 61 full and part-time jobs, will move from Australia to New Zealand as part of Fairfax’s plan to strip out cost and transition from a print into a predominantly digital publisher.

The move will hit regional newspapers The Newcastle Herald and Illawarra Mercury hardest, with up to half of their editorial staff made redundant.

Journalists’ union The Media, Entertainment & Arts Alliance slammed the move, saying Fairfax “seems to think it can rip the heart out of these papers without consequences.”

The offshoring comes despite strikes and rallies held in Sydney, Wollongong and Newcastle to combat the proposals, and a plan to keep the jobs in Australia.

Local news network NBN reported the following reaction from employees in Newcastle.

A statement from MEAA acting federal secretary Paul Murphy said: “Fairfax has ignored its readers and instead has taken the axe to two great newspapers with proud histories of more than 150 years of service to their communities.”

“The decision Fairfax has made today is near-sighted and wrong. Fairfax management have shown they lack the vision needed to reposition the company in a multi-platform world – a vision their staff have demonstrated in spades over the past fortnight and in the alternative proposal they put forward.”

The MEAA’s idea to avoid offshoring was to create a multi-platform sub editing and production hub.

Murphy said: “Our sub-hub proposal would enable skilled sub-editors to remain embedded within the community while delivering Fairfax the very cost savings it seeks by offshoring. The proposal preserved the essential quality of the Newcastle Herald and the Illawarra Mercury – their ability to give voice to the concerns of the communities they are part of.”

The idea would have reduced the number of job losses from 61 to about 40, according to MEAA.

Murphy added: “There is no logic to the announcement the company has made today. Last week, the company issued a document about Fairfax values. I shudder to think how much management consultants were paid to come up with it. One of the values was ‘customer centricity’. Presumably that means the company is looking for an increased focus on what their readers want. Well, the readers of the Newcastle Herald and the Illawarra Mercury have made it clear that they want their local papers produced locally. Fairfax Media has ignored its customers.”

“That isn’t “customer centricity”… it’s customer contempt. The company seems to think it can rip the heart out of these papers without consequences,” he said.

Rosemarie Milsom, senior journalist at Newcastle Herald, told Mumbrella: “Losing 41 positions, which is half our newsroom – people who contribute not only design and subbing expertise, but ideas, copy and support – marks the beginning of the end of The Newcastle Herald. I am not being melodramatic. We are going to be left with a greatly depleted workforce in numbers and morale. It is a sad, dark day.”

Fairfax released the following statement:

Fairfax Regional Media, a division of Fairfax Media Limited [ASX: FXJ], has confirmed plans to relocate editorial production (page design, page layout and copy sub‐editing) of the Illawarra Mercury, Newcastle Herald and the newspapers’ associated community newspapers to an existing operation within the company, Fairfax Editorial Services in New Zealand.

The changes are part of a wider strategy to gain operational efficiencies in newsrooms and to more strongly focus the newspapers’ local editors, reporters and photographers on creating content for their audiences.

Fairfax Regional Media has been consulting with employees and their representatives since the proposal was announced on 29 May 2012.

“Since we announced the proposal there has been uninformed speculation that this move will somehow undermine the quality of the Newcastle Herald and Illawarra Mercury and impact on their commitment to local communities. This is totally incorrect,” Fairfax Media chief executive officer Greg Hywood said today.

“Behind this decision is a commitment to maintain the Newcastle Herald and Illawarra Mercury’s strength in reporting on all the issues affecting the regions. The media industry is competitive and we need to reposition our newspapers as quickly as possible so we can continue to invest in the quality journalism that readers want: local reporting, regional analysis and photography.

“Fairfax operates across Australia and New Zealand and we will use our resources in the most efficient way possible and in the best interests of our readers and advertisers. All of our New Zealand publications are produced by Fairfax Editorial Services and all remain individually connected to their own local and regional markets.”

Fairfax Editorial Services has operated for two years, is wholly‐owned by Fairfax Media and employs 170 staff who currently produce nine daily newspapers, two Sundays and almost 70 community papers.

Last year Fairfax Media successfully relocated editorial production work for The Sydney Morning Herald and The Age to dedicated, centralised production‐focused operations.

Under the new production arrangements at Newcastle and Illawarra, 56 full‐time equivalent staff, comprising 66 full‐time, part‐time and casual positions, will no longer be required across the affected titles. No reporting or photographic positions will be affected and a small number of local editorial production staff will be retained.

Fairfax Regional Media chief executive and publisher Allan Browne said the Illawarra Mercury and Newcastle Herald will continue to operate the largest newsrooms in their regions. He added the newspapers’ editors will remain totally in charge of their publications, staff and content, and printing of the newspapers will continue in Australia as normal.

Mr Browne said: “The new arrangements reflect the Fairfax group strategy to move non‐core functions to centralised and more efficient operations. This will enable our newsrooms to focus more strongly on creating content and delivering it across platforms, whether it is in print, web, mobile or in other media.

“Given the pace and nature of change in the media, we must be prepared to do things differently. In Fairfax Editorial Services, we have a ready solution. I am confident readers will be unaffected by the changes. As we reposition our business we will be far better placed to continue to serve our communities in new and exciting ways.”

Fairfax Regional Media will call for expressions of interest for voluntary redundancies and if sufficient numbers are not obtained compulsory redundancies will be required. The final number of redundancies will be mitigated by redeployment opportunities and existing staff vacancies.

Fairfax Regional Media produces 200 newspapers titles, including 15 regional dailies, and operates a national digital network of 160 websites, which receives more than 25 million page impressions per month.

The news comes as Fairfax’s profit decline accelerated today in a company update reported to the Australian Stock Exchange.


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