PROFIT SHARING ANSWERS
Well, you got some exciting news this afternoon. We were led to believe we would have time to get some answers from our health plan administrator before word went out so that there would not be too much confusion about this.
Alas, we are where we are, so let us try to fill in some blanks.
WILL ALL GUILD MEMBERS GET A CHECK FOR $6,831?
No! In fact, we don’t yet know if anyone will get a check for that exact amount. That is based on what future health-care costs are expected to be. (More on that in a moment.)
But, whatever the ultimate payout is, only members who were employed by The Inquirer in 2021 qualify. If you were hired in 2022, you do not qualify for this round of profit sharing. You would qualify for any profit sharing from 2022.
Those members who will receive full amounts must have worked all of 2021 and at least 500 hours (which includes hours for time off with pay such as vacation, personal days and holidays).
For those hired in 2021, you must have worked at least 13 weeks to qualify for some amount of pro-rated profit sharing.
Part-time employees will receive a reduced pro-rata share based upon the ratio of the number of actual hours worked by the employee in 2021 over the annual full-time hours for the applicable employee.
WHEN WOULD CHECKS BE ISSUED?
Under the contract, payments are to be made within 30 days after the Company’s audited annual financial statements are finalized. Checks could be going out as early as next Friday, but that is not guaranteed.
WHAT THE HELL DID THE LAST PARAGRAPH OF THE COMPANY’S ANNOUNCEMENT MEAN?
In the contract, Article 46 spells out the conditions of the profit sharing arrangement the Guild has with the Company. This entitles the Guild to 25% of any profit made in a fiscal year. The one that applies here is December 2020 to December 2021.
Because health-care costs are so volatile and often unpredictable and are a huge expense, the Guild and Company negotiated as part of the current contract that the Company could hold any profit sharing payments due Guild members to offset any health-care cost rises that exceed 6 percent. (The Company has agreed to cover any health-care cost increases up to 6% in any given year; any increases beyond that must be borne by Guild members, typically in the form of increases in your weekly health-care deductions, which currently stand at $20 for singles; $50 for anything other than singles.)
So, for instance, if we learned in the next week or so that our health-care costs will be rising up to 6% next year, the company could pull from the profit-sharing set-asides to make up the difference so that your weekly deductions would not have to be increased.
However, Bill Ross talked to our health plan administrator right after our profit sharing meeting with the Company this morning and he said he is not in a position to project whether or how much our rates will rise. The Guild’s health costs have stayed within a 2%-3% increase over the last couple years, thus covered completely by the company (which has agreed to cover increases up to 6% as stated earlier) and allowing us to avoid increasing your weekly health-care contributions. The administrator did say that our health costs have been up substantially this past year. It’s just too early to know how that is going to impact rates next year.
How and if this impacts your profit-sharing check we just don’t know yet. The Guild and the Company hope to have an answer to that soon.
HOW MUCH PROFIT DID THE COMPANY MAKE?
Bill and I are not permitted to disclose that information. It is provided only to us to satisfy the profit sharing provision of our contract.
CAN WE EXPECT THE SAME AMOUNT OF PROFIT SHARING NEXT YEAR?
That is impossible to know but please be aware that two circumstances that will not be repeated contributed to why the Company experienced a sizable profit this past fiscal year: It sold the printing plant and it received a $10 million forgivable loan from the federal government. As the Company’s email pointed out, profit sharing amounts in past years were in the hundreds not thousands of dollars!
DOES PROFIT SHARING GUARANTEE NO LAYOFFS OR BUYOUTS?
Absolutely not. It reflects a snapshot in time (December 2020 to December 2021 and certain conditions during that time). How the company has done since then and how it impacts hiring and staff reductions are completely independent.
ARE PROFIT SHARING PROCEEDS TAXABLE?
Yes. The amount the Company has announced is before taxes.
CAN MY PROFIT SHARING PROCEEDS BE DEFERRED TO MY 401(k)?
WHAT IF I STILL HAVE QUESTIONS?
Please reply to this bulletin.
Meanwhile, we’ll keep you posted on further developments.
Diane Mastrull, president
Bill Ross, executive director