Hostess Brands (May Be) Destroyed By Union Greed

Hostess Brands and the Teamsters union are squaring off in bankruptcy court Tuesday in a case that could decide the company’s future.  The union, which represents 7,500 Hostess workers, hasn’t reached a contract agreement with the bankrupt maker of Twinkies, Ding Dongs and Wonder bread.

Hostess argues that its pension and labor costs are untenable. A ruling against Hostess in court would force the company back to the bargaining table with the Teamsters. A ruling in favor of Hostess would allow the company to escape its current labor contracts.

“And in that case, we will be on strike,” Ken Hall, Teamsters vice president, told The Huffington Post. According to Hall, the union’s Hostess workers voted overwhelmingly to authorize a strike. Though he wouldn’t put a date on it, he said the strike could happen “very soon.” The union recently acknowledged to the court that negotiations were “in crisis.”

Hostess CEO Gregory F. Rayburn said in an emailed statement that a strike by either the Teamsters or the workforce’s other major union, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, would put the company under.

“Hostess will be forced to liquidate if there were a strike by either of its largest unions because its lenders would pull their financing,” Rayburn said. “That’s why the company has tried to reach a consensual agreement with its unions that would lower the costs of its union pension and health plans while still providing employees with good, industry standard benefits.”