A union representing U.S employees of Reuters Group Plc. is mounting a legal challenge against outsourcing of many of their editorial jobs to Bangalore in India.

An independent arbitrator will hear the Newspaper Guild of New York’s charge that offshoring U.S.-based editorial jobs violates its contract with Reuters. The arbitrator's decision will be legally binding. The case could take months to complete.

The employees had scheduled a protest against outsourcing on April 7. As the lawyers square off, journalists and other employees had planned to picket Reuters’ U.S. headquarters in Times Square and other U.S. bureaus at lunchtime to call attention to the dispute.

“Instead of focusing on producing the highest quality news, Reuters is now focused on producing the cheapest news,” New York Guild President Barry Lipton was quoted as saying in a press release. “This change is not just bad for our members, it’s bad for Reuters and its clients.”

The Guild said despite alerting Reuters managers last August that outsourcing jobs violates their contract, the London-based news and information company went ahead with its plans to expand its Bangalore-based editorial staff that was set up to write about American companies and other selected U.S. financial news.