Trinity Mirror shareholders urged to block Sly Bailey bonus
3 April 2012
Trinity Mirror shareholders are being urged to block proposals for a new remuneration package for Sly Bailey and to recommend that her bonus be used to save journalists' jobs.
According to a report in the Financial Times, the newspaper group's big investors have said that cuts to the directors' remuneration packages do not go far enough. A top 10 investor is quoted as saying:
"The pay plan is a wholly inadequate response to consistent and strong messages from top shareholders unhappy at Ms Bailey's pay and the group's performance."
Michelle Stanistreet, NUJ general secretary, said:
"The investors are right to be unhappy. Sly Bailey's performance has been pitiful. Trinity Mirror employees are having to cope with the effect of damaging cuts to their newspapers on a daily basis. They will find it beyond belief that she has received any bonus at all, let alone one of £248,000. The bulk of them are coping with a pay freeze and a miserly bonus of £150.
"Bailey's nine-year reign as chief executive has been an unmitigated disaster for employees. readers and shareholders. She has presided over the decline of a once great business and the group's ability to keep its lenders on board is apparently dependent on robbing the pension fund of money due to it.
"Trinity Mirror employees are bracing themselves for yet more cuts following the recent announcement of £15m further 'savings', likely on past form to increase before next month's annual shareholders' meeting. It is surely time for the kindest cut of all – Sly Bailey's departure."
Barry Fitzpatrick, NUJ deputy general secretary, said:
"It should be argued that Sly Bailey should also take a pay cut. She had a golden opportunity with the closure of the News of the World to boost circulation. But, rather than invest in the Sunday Mirror and People to secure reader loyalty, she has presided over a situation where the Sun on Sunday could easily lure them back.
"Her only management tool is to cut and cut again. I hope that investors will call her to account on 10 May, Trinity Mirror's AGM."
The Trinity Mirror's remuneration board has proposed that Bailey's maximum potential annual cash bonus be cut from £825,000, 110 per cent of her base salary of £750,000, to 55 per cent. That is a cut of £412,500 and reduces her maximum cash bonus to the same sum. The board also recommended that she be eligible for a higher long-term bonus from her present 80 per cent of salary to 144 per cent.
The latest figures show that Bailey earned a base salary of £750,000 and a short-term cash bonus worth a further 30 per cent of salary, with her pension contributions totalling another £248,000. She also received 503,000 shares worth an extra £396,000 which vest in 2014, and could earn a further 762,000 shares by 2014.
Chris Morley, NUJ Northern & Midlands Organiser, said:
"On the day she started work as Trinity Mirror chief executive in February, 2003, Sly wrote to every employee and said that the real strength of the business lay 'most importantly of all' in its people.
"But, last month, she continued her wearying agenda of cuts by calling for £15 million more savings this year. The NUJ demands that she shows a lead now and gives up her own cash bonanza to help keep more journalists in their jobs nurse her damaged company back to health."
Last month, Trinity Mirror said it was to make cuts of a further £15 million – making a total of £120m in four years – as the group announced a 40 per cent fall in pre-tax profits to £74m for 2011. The newspaper group, which publishes five national papers and more than 130 regional titles, is to cut pension fund payments by £69m over three years to 2015, as part of a deal to refinance its £221m debt. The report also detailed a new £110m bank facility.
A NUJ survey of reps at Trinity Mirror paints a picture of poorly paid journalists covering for redundant posts, spending most of their time uploading to websites rather than finding and writing up stories. Photographers are becoming a dying breed, with papers relying on readers' pictures. Papers are thinner and editions fewer. The only good news is that there has been some investment in websites on a number of the titles.
Trinity shareholders will have to approve the changes at the annual general meeting on 10 May.