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Should Hostess workers have made more concessions?
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A Hostess Twinkies sign is shown at the Utah Hostess plant in Ogden, Utah, in this Nov. 15, 2012 file photo. Hostess, the maker of Twinkies, Ding Dongs and Wonder Bread, announced Friday Nov. 16, 2012 it is winding down operations and has filed a motion with the U.S. Bankruptcy Court seeking permission to close its business and sell its assets, including its iconic brands and facilities. (AP Photo/Rick Bowmer)
Hostess Brands Inc. says it’s going out of business after striking workers across the country crippled its ability to make its Twinkies, Ding Dongs, Wonder Bread and other snacks.
The company had warned employees that it would file a motion with U.S. Bankruptcy Court Friday seeking permission to shutter its nationwide operations, including a facility in Waterloo, and sell assets if plants didn’t resume normal operations by a Thursday evening deadline.
The closing would mean the loss of about 18,500 jobs.
Do you think the striking workers should have made more concessions to keep Hostess bakeries open nationwide, including in Waterloo?
No,
If Hostess was in such bad shape that it couldn’t stay in business without making significant cuts in wages and benefits, then it was on its way out anyway. For the people who worked for Hostess what would be the point.
I haven’t eaten Hostess stuff since I was in grade school. Wonder Foam, er, Bread lost its appeal when I discovered that slices could be compressed to a dirty grey little ball just by rubbing the slices between my hands. Yuck.
Of course their products are iconic and ain’t it a shame, but it seems to me that they weren’t keeping up with changing tastes. They’re producing basically the same soft, bland Depression Era comfort foods in 2012 that they were producing nearly three quarters of a century ago. Time just ran out on them.
Either that or remarkably bad management. If it was bad management then maybe workers should be calling the company bluff. As in if management flushes the company down the toilet, the employees aren’t going to cut their own throats saving management’s backside
“I haven’t eaten Hostess stuff since I was in grade school.”
What does that have to do with anything? Why is it always about you? You do know pride is one of the deadly sins, right?
Why is it that Roberta doesn’t have clue?
“Economists say high sugar prices tied to US trade tariffs were a big reason Hostess was struggling, but a Mexican company could be a lifeline for Twinkies because it would be able to take advantage of access to lower-priced sugar in Mexico.”
http://worldnews.nbcnews.com/_news/2012/11/17/15245611-mexican-company-bimbo-may-be-eyeing-twinkies?lite
This is a decision that had to be made by the workers and their union. I fully respect their right to make that decision and will not second guess them.
“This is a decision that had to be made by the workers and their union. ”
Don’t try to make it sound like this was a company wide walk out. This was strictly some of the bakers, not the entire baking staff. Oh, that’s right since it’s only a few people messing things up for everybody, no big deal. If Hostess had moved those jobs to China you’d probably be crying and whining about the corrupt management.
Hmmm, I’m working for a company that declared bankruptcy, they want me to take a 8% cut in pay to help cut costs. So, would I do that or would I go on strike and take a 100% cut in pay? I would’ve taken the cut and lived with it. I feel sorry for all the folks that didn’t go on strike and now are suffering due to the actions of a few.
So are you saying that you personally are presently employed by a compnay that has declared bankruptcy and wants you to to take an 8% pay cut, or are you just projecting your feelings? If it’s the latter, I submit that you might feel entirely differently about the matter if this were happening to you, and you knew the bleak prospects of a company in bankruptcy.
Lorenz,
Abernathy seems to be emphasizing loyalty over self-interest.
There was a time when loyalty counted for something, when people when to work and stayed with the company and worked hard and supported it for thirty forty fifty years. That time is gone. Companies care more about their office furniture than they care about the people who work for them.
If the company is in trouble, these days only a fool would stick around.
The unusually benign Pullman and Ford models of paternalistic employment is long dead, killed off in part by unionism, in part by capitalist greed, and in part by the USA becoming a world economic power. Whatever accounted for its demise, it won’t be coming back. Anyone who has loyalty to an employer in opposition to his own self interest is at least a fool and at most an industrial serf.
” I submit that you might feel entirely differently about the matter if this were happening to you,”
Oh Jack, bless your heart. I was summarizing the problems facing Hostess and their employees. On a side note, yes I worked for a union and took a 10% cut in pay, they still closed us down a few years later, but we weren’t wimps and didn’t cry about it.
If the company in which you worked had had no union, and the company decided to “get solvent” on the backs of its workers by cutting their pay 40%, could you still have afforded to stick around, even with the promise of continued employment?
The company is saying it is the workers fault that the company is closing, but leading up to the first bankrupthy the companies execs raised their own salaries and switch from performance based bonuses guaranteed salaries which gave them up to 80% raises, while cutting the employees wages and benefits.
Most times when companies go under it is because of gross mismanagement and executives greed and not workers wages as the cause.
More info can be found at
http://www.cafemom.com/group/115890/forums/read/17618635/Twinkie_maker_execs_gave_themselves_huge_raises_then_went_bankrupt
Ken,
Thanks for the information. It pretty much doves tails with what I’ve seen of failing companies much smaller and more local.
Greedy employees are seldom the problem—unless they’re in a position to embezzle startling amounts of money because the boss isn’t paying any attention—it’s greedy, lazy, stupid, disorganized, any or all of the above, upper management, CEOs, business owners. One local business in Iowa City that had been around for three or four generations went the proverbial up the nose of the child who took over when Mommy and Daddy retired.
Sometimes it’s just bad luck, bad timing, but often it’s gross incompetence at the top level. Or simply not caring. The take the money and run that’s earned venture capitalism its apparently well deserved reputation
I think the groundlings are getting sick and tired of taking the blame for what the boss did to the business. And it’s about time.
Hostess filed for Chapter 11 bankruptcy protection several months ago, so its total collapse should surprise no one. There are several reasons why a long-established business fails, but the principal reason is: its core product is no longer wanted by consumers. The US auto industry found this out in 2008 when gas prices spiked and they were tooled up to only crank out inefficient SUVs in high volume, not high-tech econocars.
The health warnings about consuming sugary dreck may finally have sunk in now that one can’t navigate the aisles of Wal-Mart without encountering several morbidly obese individuals on electric carts, and awareness has spread that the obesity epidemic has led to a spike in diabetes and hypertension with attendant horrific health problems for all ages.
The auto bailout was arguably a success but I don’t think that the junk food lobby has enough clout to induce Congress to bail out Hostess.
Other companies will simply buy the trade names and integrate them into their product line so the obese and potentially obese need not fear loss of part of their diet staples.
The preamble of the Constitution includes ” promote the general welfare ” but if the government tries to promote more healthy eating habits among the American Public the conservatives start screaming about loss of liberty. The guvmunt will hafta pry Twinkies from their cold-dead mouths!
(Travel outside the country (or even to New York City) and returning makes it obvious how incredibly, disgustingly, FAT much of this country is. When the eventual health care costs consequences of American lard swamp the country we’ll still have our “liberty of lard”.)
The “Core” problem is workers striking on a bankrupt company. They got what they deserved.
The union workers made concessions across the board in 2004. Did the private equity fund and two hedge funds who were the most recent owners of Hostess really intend to run the company or loot it? Unfortunately the “pension” business model is outdated, but people working for Hostess (with 6 CEOs in the last 10 years, spending 5 of the last 8 years under bankruptcy) counted on that for retirement.
The furor over the loss of Twinkies and Ding Dongs will only drive up the price of the brands when they are sold to the highest bidder when the company is liquidated. The workers will not likely see any of that money.
Mary,
Not surprised at any of this. Also predictable is the response from the peanut gallery—”took a 10% cut in pay, they still closed us down a few years later, but we weren’t wimps and didn’t cry about it”
It dawned on me that there’s name for this kind of behavior. It’s called Stockholm Syndrome
I am surprised that there are a few posting here that would let a company mess over them and cut their wage and then later close the door and the workers would then turn around and say thank you to the company for messing over them and not complain.
The workers have taken pay and benefit cuts since 1990. Every time they were promised things would be better if they did. Interstate brands went through bankruptcy once all ready. Then this past spring right before contract negotiations the CEO’s salary went from 750K to 3.5 million along with the top 12 officers getting massive raises. It appears the company absorbed the pension fund to give the big raises.
Then they blame the union for their money problems. The media is not telling the whole story on this situation and allowing the company to blame the workers. For people to say the workers should have taken another reduction is just plain wrong.
How about some thought and consideration for the 18,500 people who are now without a job?
Stubbs,
Those 18,500 people are out of a job regardless. Hostess filed bankruptcy months ago. The company is going under. It doesn’t matter what the workers do.
But it seems that those people have decided that they are not going quietly into that good night. Something interesting is in the works. Maybe those of us who do not work for Hostess should let this develop and see what happens before we make judgements.
Sorry David but the world has taught us not to show thought or consideration for peasants. As people like John Abernathy say shut up and don’t complain. We should instead be celebrating the unbridled greed of the CEO and the other worthless cronies who massive raises when their company was heading down the toilet. America once a great country has become the laughing stock around the globe. We have the most corrupt corporate and political system anywhere in the world. But please don’t whine just bow down to your masters!!
I have sympathy for the other 70% of the Hostess employees who weren’t part of the baker’s union and didn’t essentially vote to close down the business, because this wan’t their choice. It stinks that a decision by 30% of the workforce is causing them to lose their jobs.
Hopefully after the bankruptcy sale, whoever buys the company assets will hire those workers when they restart twinkie production.
Wal-Mart employees are also on strike. A recent post from one of them on forrespect.nationbuilder.com might shed some light on why Hostess employees are taking to the picket line regardless of the risk.
This is from Scott Childress, city not listed:
“I will work very hard to make WalMart feel the disrespect that it shows its associates in their P&L—I’ve worked in retail for 25 years and know your filthy tricks—I will spread the word, protest, block, support and donate my time and cash to make you understand what it feels like to go to work every day and be treated like a can opener and not a person. . . .Your Black Friday will be Red. . . .unless you work with “Our” WalMart folks”
Top management at Hostess have been lying to, stealing from, cheating the company’s employees for more than twenty years and have run the company into the ground.
This kind of behavior has been standard operating procedure since the lean and mean 1980s. Did the very top of the top 1% think they could continue to behave like this and get away with it?
If nothing else the strike is forcing the conversation away from “no more Twinkies oh how sad” to OMG who did this. And it wasn’t the workers
Locally we should remember the good ole packing house industry and what happened when good wages that went away of “profit sharing”. They seldom showed a profit because the company continued to buy more plant and equipment. When all went to pieces that “investment” fed the bankruptcy court and left the pension fund for the government to handle. Let’s not forget the money that was robbed from the expansion funds between the time Wilson sold the company and Farmstead purchased it. Ancient History, but it only gets worse as time progresses.
nearly 30 years ago Wilson Foods filed for bancruptcy and slashed worker wages by about 40%. Six weeks or so after the fact we voted to strike since there had been no negotiations. after a two week strike we got about a buck and a half an hour back. The CR plant was later sold (along with the Albert Lee MN plant) to a man who tried to keep the two plants running and failed. By sometime in 1990 the plants were shutterred and all employees, union and company were out of work. So all was for naught.
The Wonder/Hostess workers cooperated with the wage cuts not once but twice. the third time the Teamster workers narrowly approved the deal, the baker’s union workers did not. Hostess Brands refused to negotiate and when the baker’s union workers walked the plants were closed putting both the Teamster and baker’s union workers out of jobs. There may be varying degrees of blame to go around but the truth, as i have watched it unfold from nearby (i work for a rival company in the Columbus OH area) is that the baker’s union strike merely hastened an inevitable end. The strike did not “cause” the closure, bad management decisions over and over again did. My sympathies lie with both the out of work Teamsters and bakery workers. it is impossible to have any sympathy for the execs of Hostess Brands who have doubtless walked away with their pockets full.