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Newspaper Dings Employees Retirement Plan, Then Reconsiders

July 26, 2011
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Related Topics: Retirement/Pensions, Benefit Design and Communication, Ethics, Latest News
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An uproar among Chicago Sun-Times newsroom employees has helped reverse a surprise fee slapped on their retirement plans.

Employees who are members of the Chicago Newspaper Guild complained to management that their quarterly 401(k) statements included unexplained May 20 fees of between $500 and $1,200 per person.

The mystery fee hit at a time when employee morale was already low. The Chicago-based publisher of the Sun-Times and suburban papers this month outsourced printing work to cross-town rival Tribune Co., resulting in 400 pressroom job cuts. It also eliminated some newsroom jobs this year.

A June letter from Prudential Retirement to employees explained that the pro rata fee was a result of the expense of combining some of the plans in a way that would reduce administrative expenses later.

But Sun-Times Media Holdings CEO Jeremy Halbreich said he was unaware of the charge and called for it to be reversed as soon as he learned of it last week.

“I had the average reaction, which is, ‘This is ridiculous,’ and we’re not going to do this,” Halbreich said.

Instead, the Chicago-based newspaper publisher will eat the $100,000 in costs for combining the plans, he said. Employees will see a restoration of the funds soon, including any gains or losses for the period when the funds were missing.

“We are glad this money is being restored, and we will check on the progress of that to make sure it happens quickly,” said David Roeder, a Sun-Times columnist and treasurer for the union. “A lot of people were very angry about the deduction, and they didn’t understand why it occurred—still don’t, as a matter of fact.”  

Filed by Lynne Marek of Crain’s Chicago Business, a sister publication of Workforce Management. To comment, email editors@workforce.com.

 

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