Lee Enterprises cancels health coverage for retirees

The following is a statement by The Newspaper Guild of St. Louis-CWA:

In an act of corporate greed, Lee Enterprises (NYSE: LEE), owner of the St. Louis Post-Dispatch and other newspapers, is canceling company-paid health insurance for scores of retirees, the Newspaper Guild of St. Louis announced today. Retirees will protest outside the Post-Dispatch building, 900 North Tucker Boulevard, in downtown St. Louis, at 10 a.m. on Tuesday, Dec. 15.

The move affects about 100 retired Guild members and dozens more management retirees. Many will lose their health coverage because they can’t afford the premiums. Some couples will have to pay nearly $1,200 per month to continue coverage under company plans.

The union expects Lee to cancel coverage for dozens of other retirees once the current union contract expires.

“Lee is trying to increase its profits on the backs of the sick and elderly. The greed and venality of this profitable corporation know no bounds,” said Shannon Duffy, business administrator for the union, which represents news and advertising employees at the paper.

While stiffing retirees, executives of Lee continue to rake in cash for themselves. CEO Mary Junck received compensation worth $2.5 million in the 2008 fiscal year, according to the company proxy. Chief Financial Office Carl Schmidt was paid $1.2 million.

“For executives to enrich themselves while cutting health care for the elderly is morally repugnant,” said Duffy.

“Lee is reneging on a promise made to men and women who dedicated their working lives to the Post-Dispatch,” said Duffy. “That promise was explicit in union contracts.” In many cases, company representatives repeated that promise personally to employees when they were considering retirement.

Guild members were promised company-paid health coverage for life. On the strength of that promise, many retired before becoming eligible for Medicare. They will now be forced to pay premiums as high as $1,161 a month for a husband and wife. In many cases, the premiums exceed their company pensions. Retirees on Medicare will lose their Lee supplementary health coverage completely.

The Newspaper Guild is already pursuing a law suit with the aim of forcing Lee to pay the full cost of retiree health coverage. That suit was filed months ago after Lee began requiring retirees to pay one third of coverage premiums.

“Lee Enterprises may abandon its retirees. Their union never will,” said Duffy. Lee, based in Davenport, Iowa, owns 53 newspapers around the nation. The company reported a profit of $1.75 million in the September quarter, which marked the low point of the recession. The Post-Dispatch also makes a hefty profit.

The company notified retirees of its decision in letters dated Dec. 4. They will lose their health insurance subsidy beginning Jan. 1.