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Fairfax CEO defends company standards -

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ELEANOR HALL: There's been a breakthrough in the dispute between Fairfax Media and its journalists
over job cuts.

Journalists from The Sydney Morning Herald, the Melbourne Age and the Australian Financial Review
have returned to work in response to the company's managers making some concessions on journalists'
pay.

The journalists' union is now negotiating with Fairfax on when and where the planned redundancies
will take place.

But in an interview with The World Today, Fairfax Media chief executive, David Kirk, maintains that
the quality and diversity of the company's journalism won't be compromised by the cuts.

David Kirk spoke to our business editor Peter Ryan.

PETER RYAN: David Kirk, you are in the middle of what has been a very bitter stand-off with your
staff. Could this have been handled better by Fairfax Media?

DAVID KIRK: I mean you always ask yourself that Peter and we will certainly think about whether
there was any way to handle it better. But it was rather unexpected from our perspective. Staff
attended a, a stop-work meeting on Thursday and we'd agreed to that and then there was an
unplanned, from our perspective, wildcat and illegal strike thereafter.

So we have been handling it and subsequent to that with that context.

PETER RYAN: Before this breakthrough was reached late yesterday, it is claimed that Fairfax
threatened to lock out staff. Can you confirm that?

DAVID KIRK: We certainly did reserve the option but it was something that we would have very much
tried to avoid.

PETER RYAN: Do you think that was an over-reaction in the heat of the moment?

DAVID KIRK: No, no, no. I don't think so at all. I do think that everyone in these sorts of
circumstances reserves their options and I am sure the staff and the union were reserving all their
options as well and; but it is not something that we would have wanted to apply at all.

PETER RYAN: Do you think this breakthrough could have been reached earlier if there had been better
communication with your staff and the journalists' union?

DAVID KIRK: In the end there just had to be an agreement and very often we see these agreements get
crunched through and sometimes in tough circumstances. So that is not unusual for all sorts of
these sorts of agreements.

PETER RYAN: But your announcement last week of a business improvement program did catch your staff
by surprise and they learnt about the proposed cuts by email. Is that good management?

DAVID KIRK: Well the problem there, Peter is we have got a lot of people in the organisation. We
have got 11,000 people and we announced redundancy of 550 across the whole business.

Now the editorial businesses were also in the middle of the EBA so it is quite understandable that
the heat and the emotion would be turned up in that part of the business.

That said, we can always learn and we can always do more and if there is opportunity for us and
there is feedback that people wanted more and more comprehensive discussion and they wanted smaller
groups or whatever it might have been, then we can learn from that.

PETER RYAN: Some of your big name columnists have been dragged into this such as Mike Carlton who
was sacked on Friday for refusing to file his Sydney Morning Herald column. Was that an
over-reaction?

DAVID KIRK: I think it is very unfortunate. It is a completely separate issue though. Nothing to do
with the EBA and we have a whole range of contributors. Very many, 50, 60. I am not sure what the
number is. Maybe more, maybe 100. They all filed except for one.

PETER RYAN: Have you had a chance to have a word with Mike Carlton? Will you be offering his job
back?

DAVID KIRK: No, Mike doesn't work for me. He works for the Sydney Morning Herald and he works for
2UE radio station so the appropriate people to speak to him are his managers.

PETER RYAN: How damaging has this dispute been to the Fairfax brand and what responsibility do you,
as chief executive of Fairfax Media, take for any of the damage that has occurred over the last few
days?

DAVID KIRK: Well, I think clearly the company and the markets have received a lot of bad PR. I mean
I would be quite open about that. It has been very unwelcome criticism from a range of quarters.

All we can do now is get good papers out, pull the organisation together and continue to do what we
do well.

ELEANOR HALL: That is Fairfax Media chief executive David Kirk speaking to our business editor
Peter Ryan.

And you can listen to an extended version of that interview on our website later this afternoon at
www.abc/net.au/theeworldtoday