North Texas-based Hostess Brands, Inc. has decided to go out of business and liquidate its assets after failing to win back striking workers.
"We deeply regret the necessity of today's decision, but we do not have the financial resources to weather an extended nationwide strike," said Gregory F. Rayburn, chief executive officer. "Hostess Brands will move promptly to lay off most of its 18,500-member workforce and focus on selling its assets to the highest bidders."
About one-third of the company's workers are union members who are unhappy about the company's cutbacks during its bankruptcy reorganization.
But problems with several unions -- including the Bakery, Confectionery, and Tobacco workers and the Grain Millers International Union -- have prevented the company from moving forward.
Hostess said it will seek bankruptcy court permission to sell all of its assets. The company said bakery production has already shut down.
Hostess owns 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes and 570 bakery outlet stores throughout the United States. Delivery will continue for now, and the Hostess Brands retail stores will remain open for "several days," the company said.
"For employees whose jobs will be eliminated, additional information can be found at www.hostessbrands.info. The website also contains information for customers and vendors. Most employees who lose their jobs should be eligible for government-provided unemployment benefits," a news release from the company states.
Some Hostess products include Twinkies, Ding Dongs, Ho-Hos, Fruit Pies and Wonder Bread. The brand also ownd Drakes, Dolly Madison, Nature's Pride and Merita.
I believe that there was a time and place for unions. I believe that unions are to be commended for all of the work they did to bring workplace laws to where they are today, from the 40 hour work week all the way to safe working conditions.
This is a perfect example of how a union can cripple the people it is supposed to represent. Instead of trying to bargain, trying to renegotiate, they take a hard stand and say that their people will not cross the line.... Now.... 18,000 some thousand people are out of work? Does the union step in now and cover people's mortgages, car payments, groceries, power bills, medical expenses? (If they do, this will break them....)
What a wonderful time of year to find yourself unemployed too, eh?
I agree fully. At one time they did an awful lot of good, and were completely necessary.
if they were still strictly about ensuring that employees rights were protected, I would support them. Unfortunately, they seem to have become about power. I am happy when they step in on behalf of someone who has been mistreated, or fired for innappropriate reasons, but they intervene and cause problems for companies trying to get rid of bad employees, bad teachers, etc. And now they have succeeded in closing down an entire company. They overstep their boundaries now, and given current employment law in most places, are no longer really necessary.
Regarding this situation with Hostess, it is their bad business decisions that lead to the point of filing for bankruptcy about 4 years ago. By doing so, they were to restructure and adopt a new business model, realign the pay scale and make some necessary cuts..... I just heard a guy trying to defend the unions in this circumstance. He basically said that "it wasn't the unions fault that Hostess found itself in this position"....?
Couldn't you blame the union for not negotiating the pay scale and saving 18,500 jobs? Their inability to do so is what cost these jobs, and the financial situation that Hostess found itself in.
I was reading comments elsewhere from an employee of Hostess. He said they wanted them to take a 27% cut in wages over five years. So he made something like 47 thou last year, 38 thou this year and at the end of 5 years would be reduced to 25 thou a year. I think that would be a little hard for me to swallow as well.
By the way, how does a company come about having a union to begin with?
I looked it up. Evidently in order to start a union where you work, you have to have so many signatures up front. Then if you manage to get so many signatures petitioning for a union in the company, they hold a secret ballot election for the workers and if the majority of the workers want a union then it will pass and after that they sit down with the employer for talks. So you or me or anyone working for a company can initiate a union and create one, not necessarily belong to an existing one is my take. The union then mediates to protect the employees in things like fair pay, time off, etc.
I tried to post the article about this guy because I am guestimating from memory but it wont save my post. Not sure what is up with that!
I will try to at least post the link for anyone who is interested. It is from an employee and he explains what is and isnt happening.
What was this last/best/final offer? You'd never know by watching the main stream media tell the story. So here you go...
1) 8% hourly pay cut in year 1 with additional cuts totaling 27% over 5 years. Currently, I make $16.12 an hour at TOP rate of pay in the bakery. I would drop to $11.26 in 5 years.
2) They get to keep our $3+ an hour forever.
3) Doubling of weekly insurance premium.
4) Lowering of overall quality of insurance plan.
5) TOTAL withdrawal from ALL pensions. If you don't have it now then you never will.
The offer wasn't a great one, but it was better than the alternative. The company has been telling it's union for YEARS that changes needed made, or the ship was going to sink. The union basically would not negotiate, and would not consider any of the tersm offered.
So, they went under, and 18,000 people are out of a job. The union is LARGELY responsible for this outcome. It's a crying shame.
So you or me or anyone working for a company can initiate a union and create one, not necessarily belong to an existing one is my take.
Once a union is created, and the positions are identified as being union positions, membership is mandatory.
Yes, that's during the FORMATION of the union. Any employee seeking employment after that has no choice. You can't take employment in a union job without agreeing to the terms, and the dues. Otherwise, you just don't work there.
MANY employees do it begrudgingly because they want the job, but they really don't support the union.
So, is that that choice we are talking about again? It would seem so. Ask the people losing benefits and retirement after working for a company for 25 or 30 years on the promise they would get retirement. I would bet most if not all of those people would gladly support a union. I know I would.
I still think that the folks that lost their jobs should have had that choice. The union forced this company out of business. During this tough economic climate many companies are being forced to make cuts - either that or go under. If the union will not negotiate, now the company is forced to close and everyone is out of a job...no choice. At least the alternative would have been for them to search for other jobs while still being employed with something, and they could have walked away on their own terms. It's not a case of a company being greedy, it was a case of them staying in business. The final outcome here was not better then the pay cuts they were being forced to make.
There are some instances, in which a person can work in union jobs and not belong to the union. The job I retired from was one. We had many people who didn't belong to the union, but if the union negotiated a pay raise, better insurance, etc, everyone benefited -- including those who did not belong to the union. Most people (like myself) belonged mostly to have union backing if they were harassed, discriminated against or otherwise treated unfairly. Belonging to the union, supposedly, gave one access to proper legal advice, and other help when needed -- didn't work for me, but it worked well for some.
Well it seems, they are heading back to negotiations as it seems they decided to cut and run before finishing the negotiations. This will be interesting. I dont understand why they dont just raise the price of their products by a nickel. Its not like no one would pay it. People love their sugar and would pay it
If this union is worth their salt, they'd damned well better be heading back to the negotiation table.... That is what they are supposed to do, but when they hold a hard line and are not willing to negotiate (do their job) you end up with what we've got here.
Greed? Greed is a two way street with this issue. Cuts have to be made, so the company threw out some numbers. The union should have counter offered and it doesn't look like that happened, now everyone is butt hurt when the company said "pull the plug"?
Union: "If you don't give us this, that and the other thing, we are basically going to quit our jobs temporarily to strike and hinder your production!"
Hostess: "If you don't negotiate with us, we are going to close making your "temporary work stoppage" very much a forever thing.
Union: "Oh yeah? We dare you!"
Hostess: ''We are closing down. Thanks for your support.....''
Union: "You were serious about closing down?"
Hostess: "We already did. We told you we were going too. Thanks for stopping by....."
Union: "Hold on a second.... These people are depending on us to negotiate for them and help them keep their jobs...."
Hostess: "Well, you screwed the pooch on that one. Can you get out of the way? We're going to go talk with Mexico and see if they want our plant there....
If the employees were smart, they would boot the union, or find a new one. I'm not quite sure how that could happen, but that's what they need to do.
And yes, greed goes both ways. What do unions use all of those dues for? "Administrative costs" mainly. ;0)
I would not take a union job. My hubby would NEVER be a union electrician. He said he hasn't met one yet who is worth a damn. They sit on their a$$, and will ONLY do the work that involved electrical stuff. I've told you that before. He's had to be on job sites with union electricians, they will flat out REFUSE to help with anything else (cleaning up, moving furniture, etc). They sit down and say, "it's not in my contract".
Union dues do go towards administrative costs and PAC's, as best as I can tell. A buddy of mine is a union electrician who was out of work for 6 months. Those dues didn't go towards his mortgage, food, auto insurance...
He'll tell you all day how great the union is.....
What a shame...last ditch efforts to come to an agreement with a mediator failed. I saw on the news (CBS) this am the union wouldn't budge, yet this article states no specific info was given, only that the attempt failed, so I'm not sure what the deal is.
18,000 jobs. I tell you, if the union WAS being difficult, those workers should be irate. I don't think they took Hostess seriously. What a shame.
On a lighter note, I am in a state of mourning for the hostess cupcakes with the white swirly icing on top? LOVE those little devils. :0(
Radio news/op ed piece out of Salt Lake City (don't know why I can get that station in the morning), the guy doing the bit said that the union rep said that "talks are progressing and he rests assured that the union will prevail."
The next bit spoken said, "this is about profitability, and without profitability there is not grow. Without profitability, Hostess could not and will not be able to pay union members what they think they are worth. Finances is the issue here and negotiations were completely dropped by the union. What in the world makes this union rep think that Hostess (who is in financial dire straights) will come around and meet the unions demands on this? They won't.... the money is not there and it won't show up over night. This union and its reps just helped cost 18,500 jobs, but they wont tell you that."
They won't.... the money is not there and it won't show up over night. This union and its reps just helped cost 18,500 jobs, but they wont tell you that." .
I mean, there is nothing to negotiate...you either accept the terms, keep your jobs and hope to see the company rebound, and grow with it, or put your foot down ( as they seem to be doing) and lose all of those jobs.
I don't fault them for being upset at the conditions, it stinks...but it's a sink or swim kind of situation. They don't seem to get it...they're going under, unless some compromises can be made. Hostess is a big company that has been around for a long time...and the union is largely responsible for its demise. Not completely...but at LEAST 50%. They should have listened all these years when the company told them they were going into the pot.
I don't see how holding your bottom line and losing all those jobs is the more attractive way to go? Unreal.
I totally understand how it must feel to compromise and "work for less". But at that point, you're still employed and can begin to look for other work. By putting your foot down and saying "Nope! Not going to do it!", and then walking off the job.... you get what you've got here. 18,500 unemployed.
Money and benefits are finite.... without profitability, one cannot keep "picking from the money tree".
So absolutely, both Hostess and the union are to blame here. A business has to have a level of sustainability to be able to furnish top wages and a big benefits package. To me, it would seem that the business would want to run as lean as possible in order to gain profit. With that being done, raises and benefits become more of a likelyhood.
But.... who needs benefits and money when you've got Obamacare. At least medically you'll be taken care of....
Thanks for "informing" mike. I don't know how I ever get through a day being as DUMB as I am. OBVIOUSLY, I assumed he was joking, hence my post:
Is unemployment seriously that long??? I knew it had been extended, but I hope you're joking about the 99 months. Woah. .
I don't know what the issue is with you lately, but you're being completely rude and disrespectful, and I do not appreciate it at all.
I never know about you. I have no idea what you know. I'm sorry if I offended you but I actually thought you did consider that 99 months+ might be real.
Maybe it was watching you weigh in on the election that inclined me to believe you took that 99 month nonsense seriously.
I'm going to allow you to stop your diet of CROW this Thanksgiving and eat a little turkey instead.
After you've finished eating up all of your leftovers go right back to eating CROW.
After all, you really did earn it.
1. . Fig. to display total humility, especially when shown to be wrong. Well, it looks like I was wrong, and I'm going to have to eat crow. I'll be eating crow if I'm not shown to be right.
2. Fig. to be shamed; to admit that one was wrong. When it became clear that they had arrested the wrong person, the police had to eat crow. Mary talked to Joe as if he was an uneducated idiot, till she found out he was a college professor. That made her eat crow.
I guess Obama and all his loyal sheep (I mean, "subjects") will be doing a lot of this once 2016 rolls around, and our nation is STILL in the same sorry state it's currently in...
I'll bet you a box of donuts that unemployment hasn't fallen below 7% by 2016. Any takers? Please don't mistake this as me betting against America, or hoping that the unemployment-rate doesn't go down, or wishing bad tidings on anyone... I'm just betting on the whether or not the Obama administration is going to be successful or not (I'm leaning towards NOT).
Well, after seeing your analysis of the 2012 election I am inclined to have no confidence whatsoever in your opinion. You were so dead wrong about practically every aspect of the political landscape that I see no reason to expect anything but continued ineptness in foreseeing future events and circumstances.
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