Hostess: Betrayal without remedy.

[techs]

Yeah, I wish people stopped liking me. Maybe then I could rake in $2.5billion in a sales in a year.

Derpa derp

Apparently they needed 3 billion in sales to keep the lights on.

 

[Darwin333]

As for me, I am pissed off, why should my tax pater dollars go to fund Hostess employee pensions. But by law, that is why we have a pension guarantee law as its the fair thing to do.

But still there is only one lesson here, jail the bastards and throw away the key. And no resort prison for them, threat them like all common criminals.

Do you think the same should hold true for every person(s) in charge of a pension that is at least partially unfunded?

 

[Darwin333]

Not true at all. What I find totally hilarious is almost nobody is pointing out that a company that makes snacks, and had sales totaling $2.5billion was operating at a $300million loss. Yeah, I blame the unions for that, too.






Wait, what???

I couldn't tell you, what I can tell you is that if I was working for a company in a situation like that I would know that a strike would be idiotic. If it was that bad that I was willing to strike I would simply skip the strike and start looking for a new job.

 

[techs]

I couldn't tell you, what I can tell you is that if I was working for a company in a situation like that I would know that a strike would be idiotic. If it was that bad that I was willing to strike I would simply skip the strike and start looking for a new job.

I would absolutely not.

We don't know the rest of the story yet. How much were they going to make under the new contract? Perhaps the company was offering less than they could make elsewhere? Were the workers afraid the company would raid the pension fund under a new contract and the workers would start losing money on thier pensions?

IMO its completely idiotic to say you would accept any contract as long as you could keep your job. Idiotic.

 

[Nemesis 1]

http://finance.yahoo.com/news/hostess-maneuver-deprived-pension-051400720.html

Hostess Maneuver Deprived Pension

Hostess Brands Inc. said it used wages that were supposed to help fund employee pensions for the company's operations as it sank toward bankruptcy.

After the company said in August 2011 that it would stop making pension contributions, the foregone wages weren't put toward the pension. Nor were they restored.

Gregory Rayburn, Hostess's chief executive officer, said in an interview it is "terrible" that employee wages earmarked for the pension were steered elsewhere by the company.

"It's what lawyers call betrayal without remedy," said James P. Baker, a partner at Baker & McKenzie LLP who specializes in employee benefits and isn't involved in the Hostess case. "It's sad, but that stuff does happen, unfortunately."

The decision to cease pension contributions angered many employees. After the bankruptcy filing, Hostess tangled with the International Brotherhood of Teamsters and the Bakery, Confectionery, Tobacco and Grain Millers International Union to renegotiate labor contracts.

While the Teamsters union agreed in September to a compromise, resistance from the bakers union was fierce.

Halted pension contributions were a major factor in the bakers union's refusal to make a deal with the company. After a U.S. bankruptcy judge granted Hostess's request to impose a new contract, the union's employees went on strike. Hostess then moved to liquidate the company.

"The company's cessation of making pension contributions was a critical component of the bakers' decision" to walk off the job, said Jeffrey Freund of Bredhoff & Kaiser PLLC, a lawyer for the union.

"If they had continued to fund the pension, I think we'd still be working there today," said Craig Davis, a 44-year-old forklift operator who loaded trucks with Twinkies, cupcakes and sweet rolls at an Emporia, Kan., bakery, for nearly 22 years.




I'm not surprised it took so long for this to come out. The right wing media saturated us with their mythical idea that the unions killed the company when in fact it was management. The the executives were getting big bonuses and raises using money that was supposed to go towards workers pensions.

Well paint it any way the unions say . It doesn't matter the workers voted no to the contract . So they don't have jobs anymore . My wife is non union . In My town she makes more money than do union workers has a better 401K than union workers . She puts 6% of wages infund and company matches . Most non union shops can say the same thing . Hormels P-9 union the workers were better off in 1970 than todays Chicago run union Hormel P9 members. So what happened . I sure the weak minded will come up with all sorts of reasons for this basic TRUE FACT . But don't be fooled they lie , and the Union gangsters should be hung . 12 years of school 1 good teacher . Another failed union that skipped work today to protest . The Bill passed . The Best thing is to replace all those teachers that protested taking a sick day. Lots of teachers looking for work / In grades 1 threw 8 teaching is a easy job . Easier than a production line . My daughter is really on happy with the school system they already see the system not working with there brillant son . FAIL FAIL FAIL . Screw Unions and any who back up the mobsters.

 

[soulcougher73]

Well paint it any way the unions say . It doesn't matter the workers voted no to the contract . So they don't have jobs anymore . My wife is non union . In My town she makes more money than do union workers has a better 401K than union workers . She puts 6% of wages infund and company matches . Most non union shops can say the same thing . Hormels P-9 union the workers were better off in 1970 than todays Chicago run union Hormel P9 members. So what happened . I sure the weak minded will come up with all sorts of reasons for this basic TRUE FACT . But don't be fooled they lie , and the Union gangsters should be hung . 12 years of school 1 good teacher . Another failed union that skipped work today to protest . The Bill passed . The Best thing is to replace all those teachers that protested taking a sick day. Lots of teachers looking for work / In grades 1 threw 8 teaching is a easy job . Easier than a production line . My daughter is really on happy with the school system they already see the system not working with there brillant son . FAIL FAIL FAIL . Screw Unions and any who back up the mobsters.

Can't wait to get back to the 1920s way of doing business. I so want to work 16 hour days with no bennies along side my 8 year old sweating it out in the Midwest summer heat making 20c/hour.

Bring it on.

 

[mchammer187]

You won't get anyone good. The company I work for declared bankruptcy 3 Yeats ago. We pay our new CEO a ton but in his 3 years actually did quite a bit to raise revenue and get certain areas growing. It was probably worth it.

Last place I went was a startup that was bleeding money. New CEO rebranded the company and changed its focus to enterprise and the place ends up getting sold for 400 million like 6 years later.



Put it this way. Lebron wants 20 mil a year from the heat. The heat want to spend less and hire some random 6'8 guy for a million a year. Tons of people want a million a year should be easy Ro fine them. New guy sucks the heat lose fans and lose more than the 19 mil they should have just paid Bron.

People who lack talent to command wages always say things like there's plenty of people who'd be able to fill CEO x's shoes. They also believe everyone in america can become anything they aspire to be.

You're analogy is flawed because if those people were Lebron James the company wouldn't be failing in the first place. Maybe those CEO's are more like JaMarcus Russell and not Lebron James is the point. Not everyone has has JaMarcus Russel talent either but you can get JaMarcus Russell level performance for a hell of a lot cheaper than what you paid Jamarcus Russell.

 

[Darwin333]

I would absolutely not.

We don't know the rest of the story yet. How much were they going to make under the new contract? Perhaps the company was offering less than they could make elsewhere? Were the workers afraid the company would raid the pension fund under a new contract and the workers would start losing money on thier pensions?

IMO its completely idiotic to say you would accept any contract as long as you could keep your job. Idiotic.

Pretty sure I implied that I would either accept what they were giving or start looking for a new job if I knew the result of my strike would land me in the unemployment line anyway. While you are striking my "idiotic" ass is going to be hustling up a job of which I gather there will be relatively few once the entire plant hits the job market.

And I thought the terms were in a story somewhere? I thought I recalled something about the company wanting the employees to chip in a bit more for benefits or something?

 

[Fern]

Hostess was in bankruptcy, and operating under the control of the bankruptcy court and pursuant to bankruptcy law. This is not unfettered capitalism by any stretch-talk to any business person who has operated a company under these rather onerous restraints.

My main question: Where the f*ck was the US Trustee's office? They should have been monitoring the bankruptcy and not permitted this diversion of trust funds, especially where management was pulling down both healthy renumeration plus bonuses.
-snip-

Mostly agree with the above portions. However, (regarding bolded portion) no trust funds were diverted. The pension plan was "frozen". This is legal. Hostess' problem would have been that they had employment/benefit contract(s) with employees and could have been sued by the employees for nonperformance. However, the bankruptcy judge approved freezing the plan, presumably to improve the company's cash flow and buy it some time to hopefully turn it around etc.

Fern

 

[Fern]

Hostess was a HUGE company, so I'm betting that for each CXO level executive there are half a dozen people underneath them who know that part of the business better than does the CXO.

-snip-

I tend to agree. At the very least, surely ALL these execs aren't deserving of continuing employment, much less bonuses.

I understand your sentiments regarding continued employment for execs who may have had a hand in problems to begin with. But we're talking a multi-billion dollar company. There aren't many execs who can handle that - period. Even less so with the necessary industry specific experience. I.e., there aren't many, if any, high level execs already in multi-billion $ bakery companies who are likely willing to leave their secure job for this one.

What makes you think those CXOs are good, or are still employed there? Once you hit bankruptcy those types tend to leave rather than go down with the ship. (I've been through bankruptcies before. When the 'handwriting is on the on the wall' people tend to jump ship, not wait around until all the other jobs are already taken. Basically, there will likely be a fight to see who can get out of the door first.)

And remember who a bankruptcy judge is primarily looking out for - it's the creditors. Not the company, it's S/Hs, it's execs or the employees. Given the size of the bankruptcy I'd imagine this was a highly respected and experienced bankruptcy judge (may not have been, but is the likeliest bet).

Fern

 

[Nemesis 1]

Can't wait to get back to the 1920s way of doing business. I so want to work 16 hour days with no bennies along side my 8 year old sweating it out in the Midwest summer heat making 20c/hour.

Bring it on.

I will tell you a thing.I am near 62 I have had a good life day by day in its time . More Highs than lows. I am tired and when I reflect back . Other than family the best thing was work it self. Sure I felt I wanted to be doing anything else. Now older in life and weary. I had great times but what a complete waste of time and resources. Work itself be it at living life from cave life to present.The work for that time is what the course setting on this ship is.I am vary pleased that for the most part I always worked in Food processing in one form or the other except a 4 year span were a worked in computer chassis for DEC main frames. The Work is what molds the society and the people . IN 1913 we were deceived and the tree that was seeded 100 years later is bearing its fruits. I have had the pleasure of working with a great American Generation and that generation is gone. My generation in mis guided atempt tried to mold the world in its image and what come from us Our fruit is rotting on the limb. Its a complete fail for the American people. Because the laws of physics apply here a winner there is. The Federal reserve Banking system . A system were we turned over our currency to foreign Bankers Namely The Rothschild Family. Its Over they own us. Why all but 1 president is of royal british blood?? We have faied because our children failed.