Union strike takes out the Twinkie

Twinkie

That delicious, spongy, creme-filled snack may be no more thanks to a strike by workers. Hostess, which makes the Twinkie and other confections, went through bankruptcy earlier this year and, as a result, had to renegotiate labor deals with unions.

While the International Brotherhood of Teamsters signed off on the proposed agreement, which allowed Hostess to cut salaries and benefits, the workers belonging to the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union have refused to sign off:

Striking Hostess Brands workers remained on the picket lines across the country Thursday night, refusing a company ultimatum to return to work or face the liquidation of the national baker.
[…]
The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union said the company stopped contributing to workers’ pensions last year, and the union wants pension benefits restored.

Production at about a dozen of the company’s 33 plants has been seriously affected by the strike, said Lance Ignon, a Hostess spokesman.

He said a decision on liquidating the company may not come until Friday morning after it’s had a chance to assess plant operations late Thursday.

The deal Hostess was offering wasn’t that bad given the economy. They’re asked workers to accept an 8% cut in salary and a 17% reduction in the company’s contribution to health insurance benefits, a combination that would have saved Hostess up to $200 million.

Unfortunately, Hostess announced earlier today that it would follow through on its threat to liquidate and shut down, eliminating some 18,500 jobs in

Hostess said a national strike by members of the Bakery, Confectionery, Tobacco Workers, and Grain Millers International Union that began last week had crippled its ability to produce and deliver products at several facilities.

The liquidation of the company will mean that most of its 18,500 employees will lose their jobs, Hostess said on Friday.

The 82-year-old company said it took the decision to shut down after determining that not enough employees had returned to work by a deadline on Thursday.
[…]
“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” Chief Executive Gregory Rayburn said in a statement. “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.”

This doesn’t wipe away some of the company’s financial problems, but the labor deals that were in place made it very difficult to compete in the business. Sothere you go, folks. Unions killed the Twinkie.

 


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