July 6, 2009 / 9:19 PM / 10 years ago

UPDATE 1-Workers at Canada's Globe & Mail ratify labor pact

* Contract passes by 85.7 percent

* 5-year deal freezes workers’ wages for 2 years

* 2 pct increase in year 3; 2.5 pct raises in yrs 4 and 5

* Current workers to keep defined benefit pension plan

* New hires to join defined contribution plan

By John McCrank

TORONTO, July 6 (Reuters) - Workers at Canada’s Globe and Mail newspaper voted in favor of a five-year labor contract that freezes wages for the next two years, reflecting the distressed state of the industry, the union said on Monday.

The paper’s unionized employees voted 85.7 percent in favor of the pact, which the union and the paper tentatively agreed to just before a strike deadline last week.

“All of our members are sensitive to the fact that the media in general, and newspapers specifically, are going through difficult economic times, both because of the recession and because of changing habits in advertising and the way people receive their news,” Brad Honywill, president of Communications, Energy and Paperworkers Local 87-M, told Reuters.

“While being sensitive to the company’s concerns, we weren’t willing to have our contract gutted and we were successful in preventing that,” he said.

Workers will get a 2 percent wage increase in the third year and 2.5 percent raises in the fourth and fifth years of the contract. The deal expires June 30, 2014.

Current workers will keep their existing defined benefit pension plan, but new hires will have to join a defined contribution retirement plan, the union said.

The CEP represents about 450 workers at the national paper, which is a division of CTVglobemedia.

To cope with the downturn, media groups have laid off staff and sought salary, benefit and other concessions from their remaining employees.

The Globe has not been immune. In January, it revealed plans to cut about 80 jobs through layoffs and voluntary severance.

“We’re very pleased to have reached an agreement with the union that acknowledges the changing realities of the media industry,” Phillip Crawley, publisher and chief executive of the Globe, said in a release after the vote.

CTVglobemedia is owned by the Ontario Teachers’ Pension Plan; Torstar Corp (TSb.TO), which publishes the Toronto Star newspaper; BCE Inc (BCE.TO), parent of Bell Canada; and Woodbridge Co, an investment vehicle for Canada’s billionaire Thomson family. Woodbridge is also the biggest shareholder of Thomson Reuters (TRI.TO) (TRI.N). (Reporting by John McCrank; editing by Rob Wilson)

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