Reach has agreed to pay back up to £4m to employees who took pay cuts at the start of the Covid-19 crisis between April and June last year.
However staff have been warned there will be cuts to discretionary spending within the company as a result, with no all-colleague share award this year.
It comes just a month after Reach offered to settle with a small number of staff who lodged an employment tribunal claim about Covid pay cuts not being reimbursed. Last year the company “refused to entertain the idea” of paying the money back, according to one member of staff.
Reach chief executive Jim Mullen told staff on Friday that a one-off payment to reimburse the money would come in September.
The board and executive committee will not be reimbursed for their temporary pay reductions, which at 20% were higher than the majority of non-furloughed staff who lost 10%. Reach said last year that no salaries would fall below the living wage.
A Reach spokesperson said: “In April 2020, facing what was then a very unprecedented and unpredictable challenge, we took the difficult decision to reduce salaries for a three-month period.
“Having considered this in recent weeks we have decided to reimburse colleagues for the April to June 2020 pay reduction. The board and executive committee will not be taking any reimbursement for their pay deductions.”
The National Union of Journalists had opposed the original pay reduction, saying it was imposed with no consultation and breached contracts.
It also criticised the fact Mullen and chief financial officer Simon Fuller received almost £300,000 in bonuses plus around £1m in shares in Reach’s long-term incentive plan at around the same time.
NUJ general secretary Michelle Stanistreet said: “This is great news for our members who struggled to instantly adapt to working from home at the start of the Covid crisis while at the same time they were forced to endure a hefty pay cut.
“We very much welcome the decision by Reach to reimburse staff wages. This is a sensible and pragmatic step, and the crucial lesson from this is the importance of media businesses such as Reach talking to the NUJ through proper consultation to justify and understand the impact on their journalists when contemplating significant changes. We look forward to discussing with the company how all our members will finally get their money back.”
Around a fifth of all Reach staff were put on furlough at the start of the pandemic, receiving 90% of their wages, with a total of £7m claimed from the Government in 2020 to cover the mandated 80%. Reach is no longer using the furlough scheme.
Reach publishes the Mirror, Express and Star national newspaper and is also the biggest regional publisher in the UK with titles including the Liverpool Echo and Manchester Evening News.