NAA filed comments in July 2006 with the Federal Trade Commission (FTC) on its proposal to change the “business opportunity rule.” The FTC’s proposed rule would have required businesses to inform agents of the inherent risks of sales arrangements. Compliance with this proposed rule would have significantly increased newspapers’ cost of doing business, as newspapers would have had to complete and distribute thousands of disclosure statements prior to entering into agreements with independent contractors. NAA’s comments stated that the industry was unaware of any evidence of a consumer protection problem with the buy-sell arrangement that the majority of our carriers have successfully utilized for more than a century.
After reviewing more than 17,000 comments, the FTC announced on March 18 it was proposing to narrow the scope of the business opportunity rule. The Revised Notice of Proposed Rulemaking cites NAA’s comments and states that covering the relationship between newspapers and independent carriers was unintended. In addition, “the Commission has narrowed the proposed definition of the term ‘business opportunity’ to exclude from coverage distribution arrangements in which the only required payment is for reasonable amounts of inventory at bona fide wholesale prices.” Newspapers have relied upon this “safe harbor” language for decades, and NAA fought to have it included in the revised rule. After a significant wait, this is an excellent result.
WORKPLACE
Newspapers seek to provide a productive, safe, and fair workplace. The Fair Labor Standards Act (FLSA) establishes minimum wage requirements; regulates child labor; and requires premium pay for overtime worked. The FLSA exempts certain categories of employees from the minimum wage and overtime pay requirements. NAA advocates the interests of newspapers in having these "white collar" exemptions, particularly the professional exemption, apply to the field of journalism.
The newspaper industry has a long tradition of obtaining services through independent contractors. Most newspapers' distribution systems utilize independent distributors and carriers. Independent contractor stringers and freelance writers provide newsrooms with high quality local and specialized coverage. Occasionally, newspapers may contract with independent advertising salespersons to solicit new advertising customers. Heightened government attention to the potential misclassification of workers as independent contractors have forced newspapers to exercise additional care in structuring their use of independent contractors and re-evaluating their use to make sure the benefits of independent status outweigh the disadvantages.
Newspapers that have labor unions resort to arbitration as a strike-avoidance technique, formal collective bargaining resulting in written labor agreements, and the resolution of disputes between unions and employers by conference of their respective leadership. The National Labor Relations Act, administered and enforced primarily by the National Labor Relations Board (NLRB), governs the relationship between unions and their management. Newspapers, like other private sector employers, must comply with the administrative decisions and guidance issued by the NLRB.
NAA continues to monitor legal developments regarding other workplace issues affecting the industry.
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November 29, 2010
For the first time in California, a newspaper has defeated an attempt to certify a class in carrier litigation. The case, Sotelo v. MediaNews Group Inc.,was brought by newspapers carriers who fold, bag, and deliver papers, and by distributors who handle multiple routes and /or publications. Plaintiffs allege they were classified improperly as independent contractors and assert a variety of claims, including wage and hour violations, fraud, and concealment.
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November 29, 2010
On November 16, 2010, a panel of the U.S. Court of Appeals for the Ninth Circuit, 2-1, denied the North County Times’ petition for permission to appeal the district court’s July 27, 2010 order granting class certification in Dalton v. Lee Publications, dba North County Times. The panel, without opinion, cited its prior decision in Chamberlan v. Ford Motor Co., 402 F.3d 952 (9thCir. 2005) in support of its order. The lower court had certified a class of approximately 800 current and former home delivery newspaper carriers after concluding they had met the numerosity requirements of Federal Rule of Civil Procedure 23 (f) and that plaintiff’s claims that they were misclassified employees were sufficiently typical of the class.
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August 03, 2009
The D.C. Circuit Court of Appeals has reversed a National Labor Relations Board decision that allowed employers to prohibit union-related e-mails. The court in Guard Publishing Company dba The Register-Guard v. NLRB rejected the Board’s determination that the newspaper lawfully disciplined the president of the Eugene Newspaper Guild for sending union-related solicitations since such discipline was inconsistent with the newspaper’s practice of permitting other kinds of personal solicitations.
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April 22, 2008
NAA filed comments in July 2006 with the Federal Trade Commission (FTC) on its proposal to change the “business opportunity rule.” The FTC’s proposed rule would have required businesses to inform agents of the inherent risks of sales arrangements. Compliance with this proposed rule would have significantly increased newspapers’ cost of doing business, as newspapers would have had to complete and distribute thousands of disclosure statements prior to entering into agreements with independent contractors. NAA’s comments stated that the industry was unaware of any evidence of a consumer protection problem with the buy-sell arrangement that the majority of our carriers have successfully utilized for more than a century.
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