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The freeze affects “non-qualified supplemental executive retirement benefits” and will not affect any rank-and-file workers, Elaine Lintecum, McClatchy’s chief financial officer, told FOX Business. She declined to specify how many people would be affected by the freeze.
The company is looking to address “long-term liquidity pressures” caused by its pension obligations due later this year. The company's employee pension plan is underfunded by more than a half-billion dollars, according to the Sacramento Business Journal.
“This decision is not taken lightly, but at a time when the company is actively negotiating the future of the qualified pension plan, it would be inconsistent with our culture to continue payments on the non-qualified plans,” Lintecum said in a press release.
McClatchy, which publishes 30 newspapers including the Miami Herald, The Kansas City Star and The Sacramento Bee, is in the process of restructuring negotiations with lenders, bondholders and the Pension Benefit Guaranty Corporation about its pension obligations, according to the press release.
The company said benefits covered by its $1.3 billion qualified pension could continue to be distributed as normal.
McClatchy is reportedly the second-largest newspaper chain in the country after GateHouse and Gannett received approval to merge last fall. But it’s not the only news media business to hit rough financial times recently.
More than 3,300 journalists lost their jobs in 2019, The Columbia Journalism Review reported last month. They included 255 McClatchy workers who were laid off last February.