Expect strife at Fairfax very soon now.

I understand that management has a contingency plan for a two-week stoppage by journalists, and that a meeting was held of senior executives last night to make sure that all is ready. Meanwhile the union plans stop work meetings later this week.

The journalists’ union claimed yesterday that Fairfax has broken off negotiations on a new enterprise agreement. Management intends to ballot staff at individual mastheads in an attempt to get them to agree to separate agreements.

As well the company has said it intends to approach journalists earning more than $100,000 with a “merit pay” offer. The union quotes Fairfax executive Lloyd Whish-Wilson as saying: “Some people will find that they will be rewarded in ways they couldn’t imagine… and others will receive nothing.”

Fairfax Director of Corporate Affairs, Bruce Wolpe, declined to comment this morning.

If individual agreements for each masthead are put in place, it would end the long-standing arrangement under which Fairfax newspapers and the accompanying magazines are covered by one award. This would have long-term implications for News Limited journalists as well.

The union, which has asked for a five per cent pay rise and an increase in superannuation contributions, sees the move to separate agreements as an attempt to union bust – but says that if it is going to happen, then Fairfax Digital staff should be included in the ballot.

The ballot, combined with the merit pay offers, will be a key test of union strength at Fairfax, and in the industry more generally. It would seem that management reckons it is on a winner. On the other hand, does Fairfax management realise how much bad feeling there is in both Sydney and Melbourne over the various erratic management practices of the last few years?

Meanwhile not all of those in management are happy with the way things are going. Some are doing the figures on the bonuses paid to senior executives (see page 10 of Fairfax’s last annual report), and suggest that the union would do well to offer to accept less than 5% if senior executives agree to a cap on their bonuses.