On August 10, 2016

Questions about Rutland Herald’s financial stability surface

Mitchell fires Keays after publishing story, follow-up nixed

By Adam Federman, VTDigger.org
John Mitchell, the president of the Rutland Herald, fired the top editor at the newspaper on Friday evening, Aug. 5. The Herald’s news editor, Alan Keays, was terminated hours after he authorized publication of a story questioning the newspaper’s financial situation. A follow up story on the same topic was planned for Saturday, but was nixed by Mitchell.
The story reported that checks to newsroom staff had bounced in recent weeks and freelancers hadn’t been paid for a month. Reporters and editors who worked on the story said they believed the public had a right to know and that they had a responsibility to report on it as they would any other institution.
Keays was the top editor at the Herald and had been with the company for the past 15 years.
Rob Mitchell, John Mitchell’s son and the editor-in-chief for the Herald and Times Argus, spoke to the Herrald staff at a company-wide meeting Monday, Aug. 8, at 11 a.m. in the newsroom.
“While it may look bad from the outside, it’s not as bad as it looks,” he said. “There is a future for these newspapers.”
Rob Mitchell admitted that the recent turmoil had been “embarrassing, humiliating and difficult,” but confirmed that all employees had since been paid. He did not indicate whether the same was true for freelancers.
Mitchell did not offered a clear explanation about why checks issued to several full-time employees had bounced, nor what had caused it to happen, nor many details about the company’s financial health and future.
According to several sources, John Mitchell spoke briefly at the meeting but Publisher Catherine Nelson did not.
On Friday one formal complaint had been filed with the Department of Labor. According to Commissioner Annie Noonan, she’s received several more inquiries and anticipates additional ones to be filed this week. Vermont law states that employees are entitled to wages at the time payment is due whether that is weekly or bi-weekly. If they do not receive their wages they can notify the Department of Labor and file a wage complaint. Most of the time such disputes are worked out between the department and the employer, said Noonan.
Catherine Nelson was  named publisher of the Rutland Herald and Times Argus on Dec. 29, 2015.
Julia Purdy, a freelance writer and copy editor in Rutland, has recently written four stories and has not received payment for any of them.
“I think they’ve done a lot of damage to their credibility,” said Purdy whose mother and stepfather both worked at the paper.  Purdy said she fears the situation is “worse and deeper than I thought.”
Gordon Dritschilo, who wrote the story that appeared in the Herald on Friday morning, described widespread discontent in the newsroom. He wrote that staff members “bristled in the face of continued silence from management regarding the newspaper’s apparent financial difficulties.”
“Two weeks after a number of staff payroll and expense checks bounced,” he continued, “management of the family owned newspaper had yet to offer an explanation to its employees or the public.”
Gordon Dritschilo, who wrote the story that appeared in the Herald on Friday morning, described widespread discontent in the newsroom. He wrote that staff members “bristled in the face of continued silence from management regarding the newspaper’s apparent financial difficulties.”
“Two weeks after a number of staff payroll and expense checks bounced,” he continued, “management of the family owned newspaper had yet to offer an explanation to its employees or the public.”
Dritschilo also wrote that in recent months employee cell phone service had been suspended, apparently for nonpayment, and the Herald temporarily lost access to the subscriber-only federal court database. Earlier in the year employees were told that they would no longer be able to cash in unused sick time from 2015.
The paper’s apparent financial woes come just a month after the Herald announced that it would be cutting back on its print edition. The paper is now printed Thursday through Sunday and offers an e-edition Monday through Wednesday.
Last week, reporters at the Herald were told that there would be a meeting to discuss their concerns but it was repeatedly postponed. Last Monday, Aug. 1, Publisher Catherine Nelson sent an email to staff, which said in part, “We don’t want to keep you in a holding pattern and have not been able to figure out a good time for a stand up meeting—as of yet. This is not a mandatory meeting so if you need to do other things please do.”
Nelson emailed Herald employees Friday evening, Aug. 5, about a meeting to be held on Monday, Aug. 8. “I know that we have rescheduled a few times but this will definitely happen,” she wrote. And, this time, a meeting did in fact occur. At that meeting Editor-in-Chief Rob Mitchell read the following statement to his staff:
“I want to first of all acknowledge that this has been a very difficult few weeks for all of you and for these newspapers. The uncertainty has weighed on all of you, and on us. You may wonder why we have rescheduled this meeting repeatedly. The simple, honest answer is that we have had a lot of work to do, each and every day, and wanted to ensure that any information provided to you was accurate. Our priority through all of this has been to preserve these newspapers and to make sure that our employees are paid, and we meet our obligations. We have worked tirelessly on that and have done that.
“Yes, several employees had manual checks bounce. As was reported in the story Friday, we have been late paying expenses, and we have been late paying freelancers. None of that has been easy for you, for our drivers and it has not been easy for me or my father. I walked over to the bank with several of you to make sure you got paid. We have written letters for employees whose checks bounced, to make sure that your banks know that it was an issue between the newspapers and our lender, not your fault. Personally, this has been embarrassing, humiliating and difficult, as I’m sure it has been for many of you. If you hare having any additional difficulties, you need to bring those directly to our attention in a one-on-one basis so that we can address those issues directly with our lender.
“We are all tired, and if you’re like me, you’ve lost a significant amount of sleep. But all our employees have been paid, and employee expenses have been paid. While it may look bad from the outside, it’s not as bad as it looks.
“At this point, there are still things we can’t talk about, for a variety of reasons. Rather than focus on what we can not yet openly discuss, I am going to try to focus today instead on what we can talk about–the overall direction and the future of these newspapers. There is a future for these newspapers. The context to where we are right now is important. We started this year with a general plan that is designed to bridge our newspapers to the digital world. It’s no secret that these newspapers and newspapers everywhere have had major, life-changing challenges. On top of this transition, we’ve had to deal with a flood that destroyed our press and a lot of other problems that are out of our control.
“It has always been my family’s intention to do whatever possible to ensure these newspapers make the transition to a new business model. We have worked on this plan over the course of the last few years, and have started putting it in place. In March, we launched the Business Vermont website, an online iteration of the New England Business Journals. In May, we reconfigured and improved the Sunday newspaper, and launched our first consumer-focused mobile app, Go Rutland. In July, we moved to four days of print publication. We have started a website redesign that will allow for a modern news workflow.
“None of these things were or are easy to pull off. We’ve accomplished much with your support, your hard work, your diligence and our shared belief that we are here because the mission of the Rutland Herald and Times Argus is important. It’s important for all of us to keep that in mind. My family has been a part of the Rutland Herald since 1935. We’ve been a part of the Times Argus since 1964. These newspapers have had hard times, and have had good times in those years. Through it all, the newspapers, and I believe, my family, have established a long track record of standing for the principles of free speech, government transparency, and of taking principled, public stands on issues that matter to the community at large. That has not changed – it will not change.
“What is at stake right now is whether we can prove that a strong, community-oriented news organization can and will continue. I am here because I believe it will, and my career and my heart are dedicated to figuring that out.”
Polly Lynn Mikula contributed to this report.


Photo by Polly Lynn Mikula
The Rutland Herald newspaper answers questions regarding its stability.

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