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Union-Tribune loses suit to carriers

Judge orders payment of $10 million

Superior court judge John S. Meyer has ruled against the Union-Tribune in a class-action suit brought in early 2009 by the newspaper's carriers.

The carriers claimed they were misclassified as independent contractors when they actually should have been deemed employees, and therefore entitled to expense reimbursements. The court ruled that 1235 carriers who delivered papers between 2005 and 2007 were in fact employees of the Union-Tribune.

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Judge Meyer conceded that "there was evidence presented at trial that indicated the carriers were independent contractors." The contracts stated that the carriers agreed they were independent contractors. However, Meyer found in many instances that contract provisions were not done in arm's length negotiations but were made unilaterally by the U-T.

"During the class period, the contract was revised on 11 separate occasions," said Meyer. "All of these revisions were made unilaterally by [the U-T] and for [the U-T's] benefit." The company also penalized carriers by reducing compensation if there were subscriber complaints. The company would call carriers to wake them if they did not arrive on time.

The court awarded $4.95 million to the members of the class as compensation for unreimbursed expenses. The law firm, Orange County's Callahan & Blaine, got $6.16 million for attorneys' fees and $1.25 million of that will be paid out of the award to the class.

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Superior court judge John S. Meyer has ruled against the Union-Tribune in a class-action suit brought in early 2009 by the newspaper's carriers.

The carriers claimed they were misclassified as independent contractors when they actually should have been deemed employees, and therefore entitled to expense reimbursements. The court ruled that 1235 carriers who delivered papers between 2005 and 2007 were in fact employees of the Union-Tribune.

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Judge Meyer conceded that "there was evidence presented at trial that indicated the carriers were independent contractors." The contracts stated that the carriers agreed they were independent contractors. However, Meyer found in many instances that contract provisions were not done in arm's length negotiations but were made unilaterally by the U-T.

"During the class period, the contract was revised on 11 separate occasions," said Meyer. "All of these revisions were made unilaterally by [the U-T] and for [the U-T's] benefit." The company also penalized carriers by reducing compensation if there were subscriber complaints. The company would call carriers to wake them if they did not arrive on time.

The court awarded $4.95 million to the members of the class as compensation for unreimbursed expenses. The law firm, Orange County's Callahan & Blaine, got $6.16 million for attorneys' fees and $1.25 million of that will be paid out of the award to the class.

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Comments

Hoooo boy! I wonder if this will ever be reported in the Mill, and if it is, will it be reported accurately? This comes across as the old "independent contractor" game played to the hilt. Pretend they are independent but micromanage them to the nth degree, and use that dubious status to justify all sorts of shortcuts. Examples: no unemployment compensation if/when the route is eliminated, no workers comp for those hurt or killed (which has happened) while at work, no reimbursement for auto expenses and no acceptance of liability for their torts. That's just a start.

If they could get away with this claim, what's to stop them from claiming that the newsroom is staffed with independent contractors? Then take it to the pressroom and to those who deliver the papers to the pickup points. Pretty soon the paper has few if any employees, yet it is produced and printed every day of the year.

Jan. 22, 2014

Visduh: They may not need ANY employees pretty soon, as the Manchester U-T continues it's slow, painful death.

Jan. 22, 2014

aardvark: The U-T is in a downspiral, along with metro daily newspapers generally. The question is whether U-T top management has the savvy to reverse the plunge. Making acquisitions -- even if they strengthen a monopoly -- is usually not the right strategy to stop a steady drop. Best, Don Bauder

Jan. 23, 2014

Don: I do see in the story printed in the Manchester U-T that little time was wasted in pointing out that this happened when Copley still owned the paper. I see the ruling is being appealed--I hope the ruling isn't changed or reduced, and hope that Johnnie and Dougie run up larger lawyer fees. That may be a bit cruel on my part, but seeing what has been done to the U-T since Dougie took over, it doesn't bother me a bit. Maybe Dougie's new wife will convince him to just pay the bill and get it over with.

Jan. 24, 2014

aardvark: The U-T has the right to appeal. And an appeal might not cost an inordinate amount in legal fees. Also, an appeal takes time. One has to consider the time value of money. Best, Don Bauder

Jan. 25, 2014

Visduh: Yes, the "independent contractor" game is a rancid one. Brokerage houses use it, too. In this case, the offenses were committed before Manchester bought the paper, but the case was pending when he was negotiating for the U-T. So he may or may not have taken on the liability as part of the purchase.

The law firm that won the case won a similar one against the Orange County Register. Best, Don Bauder

Jan. 22, 2014

I would have thought that Copley Press Inc. is liable for the judgment since the company owned the paper during the 2005-2007 time period. However, it appears that legal liability for the lawsuit was assumed by Platinum Equity when it bought the paper and transferred to Manchester Lynch Integrated Media LLC when the paper was sold the second time. Papa Doug and Papa John took big hits today.

http://www.utsandiego.com/news/2014/jan/22/union-tribune-lawsuit-employment-contractors/

Jan. 22, 2014

Burwell: It certainly appears that legal liability has shifted to Manchester through Platinum Equity and the Copley organization, which incurred it. Best, Don Bauder

Jan. 23, 2014

No wonder Papa slashed the 401(k). If these carriers are now employees old Pappy may be paying hefty health insurance premiums on them. One of the reasons that the UT wanted to maintain these workers as independents over the years was the suspicion that they would be the most likely to form a labor union. Speaking of which ... it's surprising that no unions have arisen to protect employees from Papa and his measures.

Jan. 23, 2014

HellcatCopley: I can understand why employees haven't started unions -- or, say, resuscitated the guild -- at the U-T. Employees are scared to death at the U-T. They just want to hold on to their jobs. There aren't other jobs out there. Best, Don Bauder

Jan. 23, 2014

To think, all those young delivery boys that David personally groomed and hired to toss mommy's papers in subscriber's yards grew up to turn their ungrateful backs on him. And what kind of wedding gift is this for Papa Doug? Oh, the indignity of it all!

Jan. 24, 2014

Scott Marks: The Copley organization had dismal labor relations and it appears this has continued under Manchester. An industry as troubled as metro daily newspapers hardly needs to spend money on labor relations.

In the U.S. generally, unemployment is so high that keeping workers happy is not a big management priority. Companies do have to keep their robots in good repair, though. Best, Don Bauder

Jan. 24, 2014
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