Health benefits, ‘muzzling’ at issue as IBT Media seeks to hold on to Newsweek talent

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There's just a week to go until Barry Diller's IAC Interactive is set to formally hand the keys of Newsweek, the 80-year-old newsmagazine his company turned into a digital-only title in January, to IBT media. But it's still not clear who will be working for the publication, or on what terms.

This morning, the Newspaper Guild, which represents employees of Newsweek and its former IAC sister-title, The Daily Beast, announced that it had objections to IBT's policies with regard to employeees talking about the company. The union revealed in a press release, which characterized IBT as "muzzling" employees, that it had filed an unfair labor-practice charge with the National Labor Relations Board, claiming that IBT was in violation of U.S. law.

Under the terms of offer letters given to several existing Newsweek employees, there's a prohibition on criticizing IBT or discussing work conditions such as salary, Bill O'Meara, a Guild representative who reviewed the letters, told Capital.

“The law gives all employees the right to discuss their pay and other terms of employment with one another, even if it means being critical of their employers,” O'Meara said in a separate statement. “It's especially disturbing that the owner of a news organization doesn't seem to understand that.”

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But there's more. O'Meara also told Capital that the benefits packages being offered to the transitioning Newsweek employees would require them to pay 100 percent of the premium for health insurance.

"They're only offering access to health insurance," said O'Meara. "We've identified that as an issue."

"We are constantly working on improving benefits while making sure we make financially sound decisions," an IBT spokeswoman countered. "Currently, IBT makes significant contributions to the healthcare premiums for our employees."

Of the Guild's other claims, she said: "We are reviewing the complaint carefully. It always has been our goal to create a positive working environment for all our employees. We value our relationship with our employees and will take action to ensure that they’re treated fairly."

The co-founders of IBT, Etienne Uzac and Jonathan Davis, have suddenly found themselves in the spotlight since agreeing to buy Newsweek from IAC for an undisclosed sum last month. Published reports have flagged the duo's association with a controversial religious figure while generating curiosity about their little-known mini-media-empire, whose flagship property is The International Business Times.

Newsweek's transition from IAC to IBT is scheduled to be complete by Oct. 1. Jim Impoco, a veteran editor formerly with Reuters and The New York Times, has been installed in the publication's top masthead slot.

But it's yet unknown who will be joining him once the ownership changes hands. Richard Just, Newsweek's current editor, confirmed to Capital that he is leaving.

O'Meara said that only a few Newsweek employees have been offered jobs with IBT so far. In total, there are a couple dozen, he said, that are still represented by the Guild, but most of them also work for The Daily Beast, which IAC ran as a joint venture with Newsweek for the past two years.

"The number of jobs they're offering is below what we believe they ought to be doing," said O'Meara.

NLRB will investigate the Guild's claims and determine whether to file a complaint.

This item was updated from an earlier version after an IBT representative responded to our request for comment.