Reuters gets bad news from union

News agency's US staff move court on outsourcing.

International news and information provider Reuters is the latest to get into trouble over outsourcing. The media company, which decided to outsource some of its editorial work to India earlier this year, might be taken to court by the Newspaper Guild of New York, a union whose members include more than 500 Reuters America staff.

According to the guild, the protest follows an announcement made by Reuters to do away with 20 editorial jobs, including 12 guild-represented positions, in the US in favour of 60 employees in Bangalore.

A press release issued by the guild in the middle of August said Reuters was guilty of violating the collective bargaining agreement between the company and the guild.

Reuters spokesperson Stephen Naru told Business Standard from New York: "We don't believe that we are in violation of any agreement and we plan to proceed with ourplans as we previously stated."

Barry Lipton, president of Newspaper Guild of New York, said: "We intend to use every legal tool available to us to stop the company from taking a step that not only harms our members, but may also harm the quality of its service."

"Besides exporting good jobs out of America, the company's plans, at a minimum, violate the spirit of a 1998 deal it made to add jobs in New York City, in exchange for millions of dollars worth of tax breaks on its new US headquarters in Times Square," he added.

As a part of a cost-cutting exercise in April this year, Reuters decided to hire a reporting team in Bangalore to report mainly about small and medium companies listed in the US.

As per its plan, initially only half-a-dozen journalists were taken on who would do basic reporting, primarily from standardised announcements such as company results.

If the story needed further investigation or interviews with company officials, Reuters journalists in the US would take over to produce updated versions of the news reports. 

(This is a revised version of an earlier item on the subject)