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Hostess threatens to lay off 18,000 employees unless strike ends[W:521]

very dumb to allow the company to go out of business. with the recent exposure and free advertising, they would have been in the cat bird seat had they stayed in business, and their products would have sold like gangbusters around the holidays. a last minute rescue of the company would have paid off.

the strike was poorly timed, but i have to say that if my pay had been cut from $48k to $35k, and then they told me it would be cut to $25k with no pension contribution and higher premiums, i think i'd be furious, too. pretty much anyone would either quit or go on strike if they suffered similar reduction in compensation in under a decade.

anyway, i'm sorry to see the brand go down. hopefully another more rationally managed company will pick up the products.
 
Helix said:
very dumb to allow the company to go out of business. with the recent exposure and free advertising, they would have been in the cat bird seat had they stayed in business, and their products would have sold like gangbusters around the holidays. a last minute rescue of the company would have paid off.

the strike was poorly timed, but i have to say that if my pay had been cut from $48k to $35k, and then they told me it would be cut to $25k with no pension contribution and higher premiums, i think i'd be furious, too. pretty much anyone would either quit or go on strike if they suffered similar reduction in compensation in under a decade.

anyway, i'm sorry to see the brand go down. hopefully another more rationally managed company will pick up the products.
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It should be the employee's choice to sever ties and replace the job with something that pays what they demand. The sickening thing is that the union forced this, from what I've come to understand the union majority was against the strike but the smaller group won out. iirc only 7k of the 18k wanted the strike, this cost all 18,000 their jobs. Instead of a two dollar(9%) pay cut they now have a 100% pay cut.
 
Helix said:
...the strike was poorly timed, but i have to say that if my pay had been cut from $48k to $35k, and then they told me it would be cut to $25k with no pension contribution and higher premiums, i think i'd be furious, too....
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I read the article in the Daily Kos that included these numbers but they seem specious to me. Consider the often reported wage reduction was 8%. If dudes income numbers are right they took a 27% reduction ($48k to $35k - roughly $6.25/hr) and then now are asked to take a 28.5% reduction($35k to $25k - roughtly $4.80/hr) . This is inconsistent with what is being reported AND is WAY out of line with the recent concessions made by the Teamsters as evidenced by the documents on the Teamster website.

Something seems hinkey…
 
LaMidRighter said:
It should be the employee's choice to sever ties and replace the job with something that pays what they demand. The sickening thing is that the union forced this, from what I've come to understand the union majority was against the strike but the smaller group won out. iirc only 7k of the 18k wanted the strike, this cost all 18,000 their jobs. Instead of a two dollar(9%) pay cut they now have a 100% pay cut.
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I think it is 4,000 only.
 
Dickieboy said:
I read the article in the Daily Kos that included these numbers but they seem specious to me. Consider the often reported wage reduction was 8%. If dudes income numbers are right they took a 27% reduction ($48k to $35k - roughly $6.25/hr) and then now are asked to take a 28.5% reduction($35k to $25k - roughtly $4.80/hr) . This is inconsistent with what is being reported AND is WAY out of line with the recent concessions made by the Teamsters as evidenced by the documents on the Teamster website.

Something seems hinkey…
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It was actually a chance at more money. The company wanted a 2$/hr. pay reduction but with the concession of issuing stocks up to 25% to the union workers.
 
LaMidRighter said:
It was actually a chance at more money. The company wanted a 2$/hr. pay reduction but with the concession of issuing stocks up to 25% to the union workers.
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If I understand it right the $2 concession was the first year. They were to get a 3% increase in years 2, 3, 4 and then a 1% raise in the 5th year. I understood the 25% ownership also but it would certainly have to be divided between the 12 unions. There WERE increases in employee healthcare contributions and reductions in employer pension contributions but that is the nature of negotiations...
 
Dickieboy said:
If I understand it right the $2 concession was the first year. They were to get a 3% increase in years 2, 3, 4 and then a 1% raise in the 5th year. I understood the 25% ownership also but it would certainly have to be divided between the 12 unions. There WERE increases in employee healthcare contributions and reductions in employer pension contributions but that is the nature of negotiations...
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I'm going to have to re read it, iirc any pay cuts were temporary, but hell I'd take a portion of stock even if it is .25/12 it's still good money "if" the company can successfully restructure, and even more if they can get to a split.
 
Dickieboy said:
If I understand it right the $2 concession was the first year. They were to get a 3% increase in years 2, 3, 4 and then a 1% raise in the 5th year. I understood the 25% ownership also but it would certainly have to be divided between the 12 unions. There WERE increases in employee healthcare contributions and reductions in employer pension contributions but that is the nature of negotiations...
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They were going to cut their pay by 8% immediately and increase their portion of the health insurance premium. In years two, three and four of the contract, they were to get a 3% increase each year; in year five, a 1% increase. Pension frozen until 2015. 25% interest in the company to all 6,500+ union workers. Two union representatives on the Board of Directors, made up of eight directors total.
 
Hmmm, I wonder how personnel departments will look at a prospective employee who lists Hostess as his/her previous employer?

Why do I think they don't have a snowballs chance in hell of being hired by WalMart, even if they would now take the lower pay? But, then, they will probably get 10 years of unemployment benefits at $11.00 an hour.

Maybe the employees did the math on unemployment benefits, food stamps, childcare support and the rest and absolutely wanted to get laid off, meaning wanting the company to shut down.
 
MaggieD said:
They were going to cut their pay by 8% immediately and increase their portion of the health insurance premium. In years two, three and four of the contract, they were to get a 3% increase each year; in year five, a 1% increase. Pension frozen until 2015. 25% interest in the company to all 6,500+ union workers. Two union representatives on the Board of Directors, made up of eight directors total.
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Okay, I definitely need to re read it. Hostess offered a sweetheart deal, the long term was nothing but win for the employees and it's more than stupid to throw away guaranteed raises, holdings in the company, and board representation over a temporary pay cut and increase in benefits contribution.
 
LaMidRighter said:
Okay, I definitely need to re read it. Hostess offered a sweetheart deal, the long term was nothing but win for the employees and it's more than stupid to throw away guaranteed raises, holdings in the company, and board representation over a temporary pay cut and increase in benefits contribution.
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Well, don't forget that the company had totally broken faith with the employees. That had to be part of it, too. Before filing bankruptcy, the old CEO gave the executives a huge raise . . . which is why, when he left the company, the new CEO asked them to all work for $1 a year until either the end of the year or 'til they emerged from bankruptcy. That didn't really do much to appease the union, since they had a "gotcha moment" already in place. Plus, again under the old CEO, the employees were giving over around $3.60 an hour towards their pensions -- which Hostess never deposited into their accounts. It appears that the judge said that debt would be erased...I'm not sure about that. In addition, for the past year or so, all the employees were "donating back" $10 a week to the company to help them stay viable.

There's plenty of blame to go on the company here . . . but still me personally? I'd have taken the contract and looked for a job. Who on earth! wants to be out of a job this time of year? Nobody's even looking for people now.
 
Dickieboy said:
I read the article in the Daily Kos that included these numbers but they seem specious to me. Consider the often reported wage reduction was 8%. If dudes income numbers are right they took a 27% reduction ($48k to $35k - roughly $6.25/hr) and then now are asked to take a 28.5% reduction($35k to $25k - roughtly $4.80/hr) . This is inconsistent with what is being reported AND is WAY out of line with the recent concessions made by the Teamsters as evidenced by the documents on the Teamster website.

Something seems hinkey…
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it's possible. cnn covered it as well, though, and reported the same story. it's possible that this particular worker's story was not representative, I suppose. however, if I were in his shoes, I'd be pretty pissed off.
 
MaggieD said:
Well, don't forget that the company had totally broken faith with the employees. That had to be part of it, too. Before filing bankruptcy, the old CEO gave the executives a huge raise . . . which is why, when he left the company, the new CEO asked them to all work for $1 a year until either the end of the year or 'til they emerged from bankruptcy. That didn't really do much to appease the union, since they had a "gotcha moment" already in place. Plus, again under the old CEO, the employees were giving over around $3.60 an hour towards their pensions -- which Hostess never deposited into their accounts. It appears that the judge said that debt would be erased...I'm not sure about that. In addition, for the past year or so, all the employees were "donating back" $10 a week to the company to help them stay viable.

There's plenty of blame to go on the company here . . . but still me personally? I'd have taken the contract and looked for a job. Who on earth! wants to be out of a job this time of year? Nobody's even looking for people now.
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Still, when a company is willing to turn a bad faith decision around and it benefits and employee, it's not smart on the employee part to turn it down over a short term loss. In fact those are exactly the types I would not hire, I would want employees who look at the entire picture.
 
Helix said:
it's possible. cnn covered it as well, though, and reported the same story. it's possible that this particular worker's story was not representative, I suppose. however, if I were in his shoes, I'd be pretty pissed off.
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Well uh, yeah...presuming regular time $48k would be $23/hr. $25k would be $12/hr...I wouldn't be pissed I'D BE WORING SOMEWHERE ELSE!
 
MaggieD said:
They were going to cut their pay by 8% immediately and increase their portion of the health insurance premium. In years two, three and four of the contract, they were to get a 3% increase each year; in year five, a 1% increase. Pension frozen until 2015. 25% interest in the company to all 6,500+ union workers. Two union representatives on the Board of Directors, made up of eight directors total.
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There are (at least) two different unions involved. The 25% stock and 2 board seats was for the teamster union. The compensation specifc, I am not sure what was offered to the bakers union - besides the wage issues you mentioned.
 
buck said:
There are (at least) two different unions involved. The 25% stock and 2 board seats was for the teamster union. The compensation specifc, I am not sure what was offered to the bakers union - besides the wage issues you mentioned.
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Two union seats on the board. That was the offer to all the unions as I understand it. I don't think it's clear "which unions" got seats . . . and I'm not quite sure it matters much. All union employees were offered the 25% stock. It applied to all of them. Not 25% each, a 25% stake for the 6,500 union employees.

The company had offered the unions a 25% stake in the reorganized Hostess if they would agree to significant wage and pension concessions but the Bakers Union members overwhelmingly rejected the proposal.
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Hostess Closing Doesn't Spell End For Bakers Union - Forbes
 
Dickieboy said:
Well uh, yeah...presuming regular time $48k would be $23/hr. $25k would be $12/hr...I wouldn't be pissed I'D BE WORING SOMEWHERE ELSE!
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I would really like to know what the vulture capitalist's basic deal was for their loan package. It looks to me that they were allotted excessive collateral and it would be advantageous for them to push for a dissolution of assets and profit accordingly. That is what they do. That is what Bain Capital is about. It is real good business, but truly seedy on the human scale. I don't know how long a vulture capitalist is supposed to try and ressurrect a dead company to be in compliance with the courts, but I don't think it is anything locked in stone. Whatever, it looks like everybody without a money stake got the short end of the stick and there is something missing in the Baker's Union story line. No real vote. Voice vote.???????
 
MaggieD said:
Two union seats on the board. That was the offer to all the unions as I understand it. I don't think it's clear "which unions" got seats . . . and I'm not quite sure it matters much. All union employees were offered the 25% stock. It applied to all of them. Not 25% each, a 25% stake for the 6,500 union employees.



Hostess Closing Doesn't Spell End For Bakers Union - Forbes
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Sounds to me like the Bakers were getting the same offer as the Teamsters but said no.
 
iguanaman said:
When your host has become a blood sucking vampire what choice do you have?
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quit and work for a non-vampire. If your description is correct, then the vampire will soon be out of business, and you will help that by working for its' competitors.

The difference is that the Govt. is financing the vampires.
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In some cases, yes. Any time you want to join conservatives in calling for an end of government bailouts and picking of winners and losers, let me know.

This is the second paycut they have been asked to bear in 3 years, the Hostess executives have gotten raises every year.
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Actually management took a pay cut.
 
Fisher said:
Sounds to me like the Bakers were getting the same offer as the Teamsters but said no.
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That is what the Teamsters said, in not-too-terribly-specific-but-still-pointed language.
 
cpwill said:
That is what the Teamsters said, in not-too-terribly-specific-but-still-pointed language.
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This is something that should have come to light sooner.
Here is the Baker's Union employee take. It also defines the "vulture capitalists" more clearly and defines the management and Corporate directions.

Daily Kos: The Successful Hostess Business Plan Included Bankruptcy/updated w/wages language

"How about $2.4 BILLION.
Joshua Scherer, a partner at Perella Weinberg Partners, a Hostess advisor said it could be worth $2.3 billion to $2.4 billion, an amount equal to its annual revenue. It also has about $900 million of secured debt and faces up to about $150 million of administrative claims.

Correct me if I'm wrong, but does that mean they owe $1.05Billion (which does not include my pension) and may sell for $2.4 Billion. That would be a profit of $1.35Billion.

These hedge funds were not bakers, they were bankers. They will make money on their 14 year endeavor. 100's of millions no doubt, over a billion dollars possible. Their goal was to break the Unions and sell off the brands from the beginning. By that measure, this CEO deserves a raise."
 
DaveFagan said:
This is something that should have come to light sooner.
Here is the Baker's Union employee take. It also defines the "vulture capitalists" more clearly and defines the management and Corporate directions.

Daily Kos: The Successful Hostess Business Plan Included Bankruptcy/updated w/wages language

"How about $2.4 BILLION.
Joshua Scherer, a partner at Perella Weinberg Partners, a Hostess advisor said it could be worth $2.3 billion to $2.4 billion, an amount equal to its annual revenue. It also has about $900 million of secured debt and faces up to about $150 million of administrative claims.

Correct me if I'm wrong, but does that mean they owe $1.05Billion (which does not include my pension) and may sell for $2.4 Billion. That would be a profit of $1.35Billion.

These hedge funds were not bakers, they were bankers. They will make money on their 14 year endeavor. 100's of millions no doubt, over a billion dollars possible. Their goal was to break the Unions and sell off the brands from the beginning. By that measure, this CEO deserves a raise."
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Interesting find...note how similar this is to: http://www.debatepolitics.com/us-pa...-thats-free-enterprise-11.html#post1061180082

And the author's name is the same...huh? I find this more and more specious in all directions.
 
Dickieboy said:
Interesting find...note how similar this is to: http://www.debatepolitics.com/us-pa...-thats-free-enterprise-11.html#post1061180082

And the author's name is the same...huh? I find this more and more specious in all directions.
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I posted it because it simplifies the Vulture Capitalists position as it regards Hostess and its future. It is all legal, but no committment to the company, just the bottom line. It's a standard business plan and much too common. I see Corporations raping pension and healthcare funds all over the country and personally feel it should be illegal, but it definitely is not or at least has not been prosecuted. New CEOs say that the pensions are overfunded, buy an annuity to replace it and pocket the difference. Same with healthcare. Most employees feel that their pensions and healthcare were often inferred to be inviolable and suddenly Voila! The rug is pulled out. There is a bigger picture here than just Corporate profits and it is the conjoined welfare of Company/employee going forward. The vulture capitalist camp goes forward as Company/employee enemies from step one. Many times the Unions do the same thing. It's a two way street that needs a traffic cop. The result bears fruit.
 
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