Hostess workers say company’s collapse shows union resolve

Robert F. Bukaty/Associated Press

Striking workers Nam Phan, left, and Randy Goodwin picket Friday outside a Hostess Brand plant in Biddeford.

BIDDEFORD — Labor leaders in Maine say the resilience of the Hostess workers on the picket line at the company’s Biddeford plant, which is in the process of being shut down after the company on Friday said it would liquidate the business, gives them inspiration in the face of what they believe have been ongoing efforts — by politicians, including Gov. Paul LePage, and corporate investors — to reduce union influence.

Mark Lennihan, The Associated Press

This Tuesday, Jan. 10, 2012, file photo, shows, Hostess Twinkies in a studio in New York.

Rick Bowmer, The Associated Press

The Wonder Hostess Bakery Thriftshop is shown at the Utah Hostess plant in Ogden, Utah, Thursday, Nov. 15, 2012.

Bakers’ union officials and their supporters say also that the demise of Hostess Brands Inc., which failed to convince striking workers to return to their jobs, is a warning sign for corporate investors seeking to squeeze more profits out of the working class.

“Unions have been losing power for years,” said Ken Rumney, a striking worker outside of the Hostess plant in Biddeford on Friday. “This is an exceptional case. If Hostess had been allowed to get away with what they’d been trying to do, other corporations would have lined up to try the same tactics. Hopefully, this will be an example to other companies not to [try to] break their unions.”

“I think we’re the first ones who have stood up and said, ‘We’re not going to let you get away with it,’” said Sue Tapley, the strike captain on hand Friday morning at the Biddeford plant, which employed nearly 600 people. “You can fight them. You can shut them down.”

At issue is a slate of concessions the company, best known for producing Twinkies and Wonderbread, asked of its workers — reportedly an 8 percent pay cut and changes to their pensions agreements, among other things. Hostess officials maintained that the company couldn’t stay viable without making the changes, while union leaders countered that the concessions went too far.

Workers began striking last week, and the company gave them a 5 p.m. Thursday deadline to return to the job, threatening to close its 33 American plants and lay off all 18,000 of its workers if they didn’t.

Members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union refused to concede, and Friday morning, Hostess announced plans to file for bankruptcy, let go of its entire workforce and liquidate all of its assets.

The union’s willingness to go down with the sinking ship — and in some cases take credit for sinking it — in the Hostess case may prove to corporate investors that the working class must be reckoned with, said University of Southern Maine economist and labor relations expert Michael Hillard.

Hillard said he will be interested to see what the ripple effect of the Hostess bankruptcy will have for labor relations nationwide, as the combustion comes on the heels of scattered Republican-led efforts to weaken unions through state laws, not to mention a steady decline in leverage in the 30 years since then-President Ronald Reagan fired more than 11,000 striking air traffic controllers.

In Maine, Gov. LePage and the Republican-led Legislature in 2011 proposed so-called “right-to-work” legislation that would have allowed workers to refuse to pay dues or fees for union representation at workplaces where active unions negotiated on their behalf for wages and benefits. The bill was ultimately defeated in the face of fierce opposition by labor leaders across the state, who characterized the legislation as a “union busting” measure.

“You’ve seen ownership practices for any kind of large scale manufacturing operation replaced by this short term financial mentality, that’s come largely from Wall Street, and looking at companies less as enterprises than as bundles of assets that can be moved around a chessboard,” Hillard said. “They’re operating with the idea that you can always squeeze more — squeeze more out of operations, squeeze more out of labor, squeeze more out of distribution, just find any way to get more profit.

“The idea that this is how you run a healthy economy is a question, and so who’s standing up to this? Labor unions are one of the ways people have to make their concerns known about the economic conditions in our world,” he continued.

Sarah Bigney, spokeswoman for the Maine AFL-CIO, a labor coalition representing 26,000 members from a wide range of local workers’ unions across the state, said the resolve of the striking BCTGM workers has been “inspirational.”

Bigney said that when she visited workers outside the plant holding signs in Biddeford, most cars honked and drivers waved in support, while other people stopped by to donate food or firewood for the strikers warming their hands by barrel fires.

“Everyone can relate to the fact that the worker class is funding the investor class,” Bigney said. “People have been doing enough in terms of ‘shared sacrifice’ on the workers’ end, and now union members are saying, ‘We’ve given enough and we need to see some shared sacrifice by the corporation, too.’”

One of those people who stopped by with firewood was incoming state House Majority Leader Rep. Seth Berry, D-Bowdoinham.

“Unfortunately in the corporate world, it’s a race to the bottom, it’s about maximizing profits for those at the top,” he said. “When that happens, it’s important for the workers to stick together.”

Biddeford Mayor Alan Casavant said, “philosophically, I think the union wins” in the Hostess standoff.

“They’re saying to the world at large, ‘We deserve a working income. We work hard, we deserve a living wage, and we don’t just want to be pawns in a corporate game,’” he said. “There’s a philosophical victory. But in an economic sense, you’re walking a fine line, because all of a sudden you’re cast into a void of not knowing what tomorrow brings… Putting myself in their shoes, I’d be scared, because there’s so much uncertainty in this economy.”

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Steve  Dosh's picture

Hostess workers say company’s collapse shows union resolve

all , 12.11.18 16:30 hst ?
You think the union workers are dumb ? No, they aren't . They are against short term and short sighted corporate greed and profits
Personally i am sure they , the workers , could run that Biddeford plant better and earn better and more equitable wages and health care and retirement benefits than the fat cat bosses , Twinkie Twin ® corporate lawyers , and even you or i , Mark , Paul and Amadeo
You go members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union !
We support you without hesitation or remorse •
We also support Wally World ® & the LSJ ® being unionized , also . ( Whoops , sorry Pattie & Rex :) Shaw's is union , right ? Hannaford ® yet ?
Shut 'em down , buy 'em out , decentralize , democratize, and run the former Hostess ® bakeries like we all know ( in our hearts and minds ) they must be run to the full benefit of the workers and not %&$^%@#% Wall st . http://occupybangor.org/ /s Steve , Union all the way , BIW ® , too :)

Amedeo Lauria's picture

Linda....that was my point...

having been a member of a union for a VERY short time, I soon realized that the union did not represent me, it is just a way to funnel money and support to leftist candidates and causes.

That is why I hope that the rank and file learns from this experience dust themselves off and realize who really supports them and their families; the folks who sign the FRONT of the check; not the folks who take their "cut' every pay period. That said, this is a very bad time to have to learn that hard lesson. I would not wish anyone to be facing their fate, especially before the holidays.

Interesting to see the "Blame Bush" crowd is now shifting to "Blame Romney." I guess the new leftist playbook and talking points haven't been published yet, post election. I was just getting used to "Romnesia!"

The letter below looking to eliminate products is either very tongue in cheek...or a clarion call for America to wake up and look at what is in store for America from a leftist socialist nanny government and those who support it. Good grief!

Steve  Dosh's picture

. .¿ Who ?

. .¿ Who ?

PAUL ST JEAN's picture

"Hostess workers say

"Hostess workers say company's collapse shows union resolve".
Yeah, well resolve this!! You've really won a great victory now. 18,000 out of a job.
Way to go, union.

Not the first time

This is not the first time this company has filed for bankruptcy and for the workers to give up some of their hard earned benefits. All of you that think this is the unions fault had better dig a little deaper into this company and see just exactly what they have been doing for the last 10 years or so. The greed is what brought this company down and nobody else. When CEOs and high managment can make record breaking pays, and then have the gall to ask their workers to give up some of their pay and benefits is just a bumch of bull. I for one will not miss the crap they have been feeding us for years...after all...does anyone know what it is they put into their Twinkies to make them last so long without ever looking like they have past their shelf life??? Glad to see them go and I wish all the workers well and hope they get other jobs where their employers will appreciate them.

Steve  Dosh's picture

Linda , Sunday 5 pm hst

Linda , Sunday 5 pm hst ?
You are correct ?
i worked for Continental Airlines ® when they had just emerged from bankruptcy to become the biggest airline in the free world ( at the time ) gobbling up Peoples Express ® , ( Peoples Distress ? :) , Eastern ®, Frontier ® , and New York Air ®
They went bankrupt while i was working for them . They have been bankrupt several times since and -- surprise -- since their merger with United ® are on the verge of going bankrupt again . We all pity the individuals who bought in to their E S O Ps ( Employee Stock Ownership Plans )
Hostess ® is fooling nobody except themselves
Give thanks this week for what you have , Republicans
The rest of US will continue to be active in the defense of humans' right to self determination
http://occupybangor.org/ /s, Steve

PAUL ST JEAN's picture

You make a few valid points,

You make a few valid points, Linda, but the bottom line is, 18,000 don't have jobs anymore, and they WALKED AWAY from the jobs they had. Is that winning?
I'll bet the union bosses still have their cushy jobs.

"hope they get other jobs.."!?

I have to say to this comment to please list employers that are hiring where they will appreciate these good people who got laid off? They don't exist. Has anyone seen the list that shows the salaries of the Union Bakers top officers?The President earns over 260k with the others not far behind in salaries. I think that the dues these union workers had to pay to their unions to see the funerals of their jobs should be reimbursed to each and every employee. Unions were good at one time to help with poor work conditions but now all they're doing is preparing for the death of our jobs and lining their pockets in the meantime. There are still some great unions out there but all should ask if the salaries of the union officials , the deals the unions make with insurance companies to be named in contracts in which the unions get a kick back(not the dues paying member nor the employer) from the named and contracted insurance companies, whether or not it is worth having a union where we are forced to pay dues only to see them make just enough deals for us to think they're working on our behalf but are in reality lining their own multi-billion dollar pockets nationwide for their own futures. The ones who suffer in the end, the consumers and workers! It's not even a choice anymore for our consumers or workers. It boils down to the company, the unions and the insurance companies..the wheeling and dealing and in the end the workers and the consumers are affected the most and lose the most. I'm sorry for the workers and the trust and hard earned money they gave to their unions to protect them. I hope we all see the uselessness of unions and vote right to work next time. maybe then, the business can afford to stay open with minimized forced regulations, forced to go with certain insurance companies etc all from the hand of the union demands that hurt the worker and consumer.

PAUL ST JEAN's picture

Great post; well stated.

Great post; well stated.

Robert McQueeney's picture

We can (try) to blame upper

We can (try) to blame upper management, mismanagement, venture capitalists, whatever. What this comes down to is a choice between an 8% cut in pay, or a 100% cut in pay. None of the people voting on either option were in upper management. The final decision was the in the hands of the union voters. Those union people who voted on this sent over 18,000 people to the unemployment lines. When all is said and done, that is the net result.

Steve  Dosh's picture

Bob , 17:00 Sunday Yes , the

Bob , 17:00 Sunday
Yes , the people will win . In the long run we always do in the U S of A , thank goodness
ƒact : 4 0 0 Americans control more wealth than >150,000,000 Americans
That's wrong just on the face of it • ref : http://video.unctv.org/video/2192345423/
h t h /s Steve :) Give Thanks this week . ..

Hostess food kills Americans .... period ... next Pepsi and Coke

Americans are voting for Presidents, Senators and ....in this case ....food.

And, Hostess was not "re-elected", and the Union was not the blame, although I am sure the company will not stop trying to blame them.

Instead, their food simply stunk ... it was and is lousy ....it makes us unhealthy .... it is just the beginning, hopefully, of a trend to get rid of all the crap food on our store shelves ....and, further, insist on proper and complete labelling of all food contents, especially the "genetically modified" kind.

Aspertame is just the tip of the preverbial iceberg.

Down with Hostess ...down with Coke, Pepsi, aspertame ....GMO laced foods ...down, down, down the toilet you go ...

bye bye and good riddance ....

Now, Let's arrest the perpetrators and criminal frauds who did this to us ....

Every home should grow and make their own food stuffs as much as possible, period.

PAUL ST JEAN's picture

100 disagrees!!

100 disagrees!!

Amedeo Lauria's picture

Yes unions, take a victory lap...

you will have plenty of time on your hands to do so. Another great American brand bites the dust with the union taking full credit. As a famous TV personality says on a regular basis "how's that working for you?" I do however hope the rank and file find jobs, I would hate to see them suffer during the holiday season.

PAUL ST JEAN's picture

Frankly, I can't garner a

Frankly, I can't garner a whole lot of sympathy for the rank and file. As an earlier poster stated, they chose a 100% pay cut over an 8% paycut, which would probably have saved their jobs. Looks like a no brainer to me. Now we have 18,000 more people who will be supported by the working taxpayers. 18,000 more people riding the wagon instead of helping to pull it.

Charlotte Morin's picture

HOW IS THIS IN ANY WAY A GOOD OUTCOME?

Shocked to read that the Union thinks that it's actually a good thing that a long-standing company has had to close AND that so many people have lost their jobs. How ridiculous is that?!?

INSANITY!

RAYMOND FRECHETTE's picture

This is a very unfortunate

This is a very unfortunate example of both sides biting their nose to spite their face. The company officials should have publicly taken a pay cut before asking the employees to do the same, and the unions should have done the same. We now have 18000 additional people out of work with a record of having lost their jobs due to striking and daring the company to quit. This is not an impressive statement when a potential employer reviews their resume. Companies and employees have to work together for the common good. I was always fortunate to work for a company where the owner's door was always open to discuss anything. Investors, business owners/managers, and workers have to work for the common good.

PAUL ST JEAN's picture

The best way to keep unions

The best way to keep unions out is for companies to treat their employees fairly and with dignity. It's a winning formula.

The sadness with the union

The sadness with the union voters is that many probably DID vote to take a cut to keep their jobs..but again..forced to go the union way and led by the blind chapter leaders. The winners had already lined their pockets before it got to this point. I would personally vote to take a cut in pay to keep my job..especially in this economy and era of uncertainty. I also intend to vote right to work when it makes it on the ballot again.

PAUL ST JEAN's picture

Even a 25% paycut (leaving

Even a 25% paycut (leaving you 75%) is still better than no job and no pay. But, then, unemployment benefits have been made attractive enough to thwart that sort of thinking.

Dave Bussey's picture

Companies and employees have to work together for the common goo

Do you think that's going to happen pretty soon? I don't. The employees don't have the power they need to do anything other than what the corporate bosses tell them to do - "for the good of the stockholders." "The common good" won't even come up for discussion when one side has all the power.

They did take a cut

According to a NY Post article from April, the CEO rescinded the pay raises for the top execs. The top four were paid $1 through the end of the year and the junior execs' pay was scaled back to their previous level. Granted, those raises were exhorbitant and the company did it only after pressure from creditors during bankruptcy. but to say that they did noit cut back their pay would be a lie.
That said, I really don't see this as a win for the unions. WIll they still consider it a win in six months when no one has bought the factory or rehired them? An 8% reduction will beat a 100% reduction any day. It is telling that the Teamsters had no trouble agreedng to the pay cuts, so not all unions can be called complicit in this.

Allisa Milliard's picture

the plant that was going to

the plant that was going to close anyway closed sooner due to their influence, but wow...did they ever teach corporations and government a lesson. next, they will demand that the non unionized workers in this country feed, house, and care for them because they don't have jobs. i'm sure obama will make sure us non unionized workers take care of those who walked away from employment just because they weren't happy.

PAUL ST JEAN's picture

Plan on it.

Plan on it.

Dave Bussey's picture

just because they weren't happy.

If you think they struck and refused to give in "just because they weren't happy" think again. They wanted to make a point. They gave up a lot by not waiting for the company to can them first - just the opposite of what you claim. They took a hit that will benefit the morale of the rest of the hourly workers who more and more have been coming to think themselves powerless.
In having lots of money there is strength. In standing together there is also strength.

CLAIRE GAMACHE's picture

The real problem

Having read even more about Hostess I have learned that their real problems began with a Romney style leveraged buy-out by a company that bought a series of small bakeries on borrowed money and loaded them all up with debt. Then they shut them down and squeeze out profits from the remaining assets for the share holders leaving the workers and the debtors holding the bag. Sound familiar?? Even better if you can blame the union.

PAUL ST JEAN's picture

Romney, huh? Well, at least

Romney, huh? Well, at least you didn't blame it on Bush.

Robert McQueeney's picture

It's been tough on all

It's been tough on all businesses the past several years. You have increased costs for materials, transportation costs due to high fuel prices, a more health conscience America trying to eat better, and ginormous "home made" chocolate chip cookies sitting next to them for 2/3 the price of twinkies.

Hard enough to sell enough of them to be profitable as it is, then you have a union voting for a 100% pay cut, verses the 8% pay cut the company was offering. When a union gets this unreasonable in this kind of business market, it is very difficult for a company to remain solvent.

What is really sad is that over 18,000 people are now unemployed, at a time when America needs all the jobs it can get. I'd really like to know what the majority of those 18,000 people were thinking when they voted themselves and others out of a job.

PAUL ST JEAN's picture

There is evidence to suggest

There is evidence to suggest that the thinking process may have been out to lunch.

18000 people did not vote

18000 people did not vote themselves out of a job. The Bakers union people were not all of the workforce, and not all of the workforce were in any union, Teamsters or otherwise. In fact, the Teamsters had readily agreed to the pay cuts in their contracts because they saw the company books and agreed that it was necessary. The BCTSM saw the books and then accused Hostess of lying about it.

And that's worse. A portion of the company's workforce has determined the fates of everyone. That is nothing to be proud of.

Mark Elliott's picture

Another sad part is many of

Another sad part is many of those bakery union workers are actually gloating about this.....claiming it is a "win for unionized labor".......they shut down an American icon and put thousands out of work. To consider this a "win" tells me it was their "goal" and if that is their goal, then we don't need them! Vote in favor of "Right to Work" next time it comes up on a ballot so workers will no longer be forced to take part in the shenanigans of labor unions! Make it totally voluntary then we'll know who the real skunks are....they won't be able to hide among the innocent anymore!

CLAIRE GAMACHE's picture

Capitalism

I guess if a company needs to steal retirement funds from its workers in order to survive, it really should go under. I'm not an expert in running a business but I doubt that kind of thing is SOP in business ethics class. It's funny how the people who wave the flag of capitalist competition the most often have no clue how it works. Fortunately those Twinkies last forever so for the fans there should be no shortage. As for the workers, it shouldn't be too hard to find a better employer than one who steals your pay.

David A. Gagnon's picture

Well Claire by your own

admission, you are certainly not qualified to comment nor criticize what has happened at Hostess. Union negotiations is what almost took them down back in 2004. Funny how the Teamsters were willing to accept and had accepted the company offer and were surprised even shocked that the Bakers Union had decided to hold out and not head the warning. The Teamsters were even crossing the pick it lines moving what product was available just to keep the company going. So union greed has put 18,000 people out on the street. The product lines will probably be sold off to other bakeries, but those plants most probably will never open again.

CLAIRE GAMACHE's picture

multiple problems

Well I have read up a little more on this and it appears they have gone bankrupt already before and shut down over twenty factories before this issue over retirement funds came up and have had multiple ceo's , none of whom were able to improve this company. I suspect there is more to this company's problems than the union. Sometimes companies that make bad business decisions and bad products don't survive.

Mark Wrenn's picture

vulture capitalists

The company is owned by vulture capitalists who had no experience or desire to run a food company. This is the second time in 3 years they filed for bankruptcy. And just a few months ago upper management all received big raises. The ceo's pay was tripled. So, they were basically using the employee pension contributions to reward upper management for running the company into the ground. Upper management will probably receive massive retention bonuses to see them through liquidation.

Those raises were rescinded,

Those raises were rescinded, Mark. The raises were actually given last year and they were rescinded in April after filing for bankruptcy. No bankruptcy court would have allowed them to give raises to the top management while going through reorganization.

David A. Gagnon's picture

So it's always the capitalists fault and

never the unions. I think there is plenty of blame to go around. Unions are greedy, I know cause I've experienced it.

David A. Gagnon's picture

Mr. Wrenn please explain this

Mark Wrenn's picture

management view

That is management's statement. How about this:
"Over the past eight years since the first Hostess bankruptcy, BCTGM members have watched as money from previous concessions that was supposed to go towards capital investment, product development, plant improvement and new equipment, was squandered in executive bonuses, payouts to Wall Street investors and payments to high-priced attorneys and consultants.
Over the past 15 months, Hostess workers have seen the company unilaterally end contractually-obligated payments to their pension plan. Despite saving more than $160 million with this action, the company continues to fall deeper and deeper into debt. A mountain of debt and gross mismanagement by a string of failed CEO's with no true experience in the wholesale baking business have left this company unable to compete or survive." http://goo.gl/PAQwg

Allisa Milliard's picture

great idea folks. rather then

great idea folks. rather then taking a cut in pay and keeping your job like so many of us out there have had to do, they went on strike on a company filing for chapter 11 protection. now they are out of work, unskilled, getting a limited severance package, and don't qualify for welfare since the strike directly resulted in the closing of the factories and loss of their jobs (they basically quit) . lets hear it for the unions!!!! brilliant, just brilliant.

Allisa Milliard's picture

and for those holding their

and for those holding their breath that a new company will swoop in, rebuild, and hire them all back...well think again. not only will that company not likely give them the same pay, benefits, or union work, chances are they won't hire strikers since there are literally thousands of other people that will do those jobs just as well and won't walk off.

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