US: Union hits out at Hostess plant closures

By Katy Askew | 14 November 2012

Hostess, union at loggerheads

Hostess, union at loggerheads

The union representing Hostess Brands workers has insisted the US bakery group is "falsely claiming" the closure of three bakeries was the result of strike action.

Hostess has been trying to force through cuts to pay and conditions and has repeatedly warned widespread strike action would result in the liquidation of the company. The Wonder Bread maker announced earlier this week it will close facilities in Seattle, St Louis and Cincinnati where workers elected to strike. The closures will lead to 672 jobs being cut.

However, according to the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, Hostess was planning to close "at least nine bakeries" in its bid to exit bankruptcy. The union insisted the closures were not a consequence of the strike action and suggested the company is attempting to intimidate its remaining workforce.

BCTGM International Union president Frank Hurt stated: "The recent claim by Hostess CEO Greg Rayburn that our strike is the reason for the closure of the three bakeries is simply not true. That statement is a continuation of a disturbing pattern by the company of issuing public statements that are erroneous at best and disingenuous at worst."

Show the press release

Hostess Continues Pattern Of Misinformation
KENSINGTON, Md., Nov. 13, 2012 /PRNewswire-USNewswire/ -- In a desperate attempt to break the solidarity and resolve of striking BCTGM members across the country, Hostess Brands is falsely claiming that its decision to close three of its bakeries -- St. Louis, Cincinnati and Seattle -- is the result of the nationwide strike against the company by BCTGM members.
In fact, according to the company's 1113 filing with the bankruptcy court earlier this year as well as its last/best/final and non-negotiable proposal to its BCTGM-represented workers, the company was planning to close at least nine bakeries as part of its reorganization plan, although the company refused to disclose which bakeries it intended to close. This is in addition to the three bakeries that were to be closed as a result of the company's planned sale of its Merita division.
Moreover, St. Louis Mayor Francis Slay was quoted in a November 13 KMOX-CBS St. Louis article stating, "I was told months ago they were planning on closing the site in St. Louis... And there was no indication at that time it had anything to do with the strike the workers were waging."
BCTGM International Union President Frank Hurt stated, "The recent claim by Hostess CEO Greg Rayburn that our strike is the reason for the closure of the three bakeries is simply not true. That statement is a continuation of a disturbing pattern by the company of issuing public statements that are erroneous at best and disingenuous at worst.
"Our members rejected the company's outrageous proposal by 92 percent in September. Rejection came from every corner of the country. They were being asked to vote on a proposal with massive concessions, knowing that their plant could very well be one of those to be closed.
"Our members are on strike because they have had enough. They are not willing to take draconian wage and benefit cuts on top of the significant concessions they made in 2004 and give up their pension so that the Wall Street vulture capitalists in control of this company can walk away with millions of dollars."
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.
BCTGM members are well aware that as the company was preparing to file for bankruptcy earlier this year, the then CEO of Hostess was awarded a 300 percent raise (from approximately $750,000 to $2,550,000) and at least nine other top executives of the company received massive pay raises. One such executive received a pay increase from $500,000 to $900,000 and another received one taking his salary from $375,000 to $656,256.
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.
A total of 24 Hostess production facilities are on strike or honoring the strike with picket lines established by striking Hostess workers at other BCTGM-represented facilities. Additionally, BCTGM members at one transport facility also are on strike. Company claims that union members are crossing picket lines and maintaining production at striking plants are vastly untrue.
The BCTGM represents more than 80,000 workers in the baking, food processing, grain milling and tobacco industries in the United States and Canada.

Original source: Bakery, Confectionery, Tobacco Workers and Grain Millers International Union

Sectors: Bakery

Companies: Hostess Brands

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