Twinkees Dead, Union Charged with Ho-Homicide..

[700UW]

Backtrack.

Bottom line is the CEO and Executives showed arrogance while they got rich while the employees took the brunt of the hits.

Joshie, show us that are the facts.

Did Lee Iccoca take a pay raise when Chrysler was almost out of business?

Nope, he worked for $1 a year.

As have other CEOs at companies when asking employees for concessions.

Dont let the facts get in your way!

 

[737823]

This is just like what happened with Caterpillar closed the London, Ontario plant and is moving production to non-union facilities in Georgia and Texas when the CAW refused to give additional concessions and engaged in a crippling strike. How well did the Caterpillar strike in Joliet, IL go for the IAM? After a 15 week strike the union got down on their knees and gave Caterpillar everything they wanted, clearly the strike was financially difficult for the workers involved and they gave into the company. What about Lockheed Martin? Same thing happened, they eventually gave into the company demands. Fact is in the current environment even profitable companies are seeking concessions to remain competitive. In the collective bargaining process workers and unions are generally only striving to maintain what they have not even obtain higher wages, better benefits, work rules, etc.

Josh

 

[737823]

Backtrack.

Bottom line is the CEO and Executives showed arrogance while they got rich while the employees took the brunt of the hits.

Joshie, show us that are the facts.

Did Lee Iccoca take a pay raise when Chrysler was almost out of business?

Nope, he worked for $1 a year.

As have other CEOs at companies when asking employees for concessions.

Dont let the facts get in your way!

Fact is a compensation committee was in place and determined the pay levels for the executives were appropriate for their expertise in the current environment. Its no different than a collective bargaining approach, union members expect market competitive pay aligned with what they contribute to the company and management is no different. I am familiar with how compensation committees are formed and operate. It seems you are disappointed they didn't consult with you.

So what is your point? Steve Jobs earned a salary of $1 in 2010, his final full year at Apple Inc. a solidly profitable and incredibly successful company. What you don't understand is the salary is only a small component of their total compensation. There are housing allowances, retention bonuses, performance bonuses, stock awards and other components to consider. In terms you may understand, its like cherry picking articles in a certain CBA and saying "Airline XYZ has the best work rules" without looking at the full picture.

Companies in bankruptcy "need to attract the best people and compensate them for the tough work they have to perform," and finding a replacement can be expensive, says Richard Levin, a partner at the law firm Cravath, Swaine & Moore.
Executives in bankruptcy work two difficult jobs: running the troubled business and attending to all the legal and procedural headaches that come with Chapter 11 court proceedings.
Aside from cash payments, companies also often bestow large stock awards on executives when a bankruptcy reorganization is finalized, arguing that they are continuations of previous programs or being made after a Chapter 11 case is done.

http://online.wsj.co...0750545602.html

 

[signals]

Leadership starts at the top, how can you ask the rank and file employees to give up their pensions, and take a 25-37% paycut while getting raises?

Sometimes it's the nature of the business. People are becoming healthier and my guess is that sales were down at Hostess. Management will always get theirs upfront regardless of the outcome.

Employees, union and non-union, are merely pawns and easily replaceable in today's society. We are no longer viewed as an asset, but rather an expendable liability. Perhaps Hostess wanted to go out of business to sell or set-up shop elsewhere, and used labor as an excuse.

Pensions, and Social Security, are nothing more than a carrot on a stick. Your employer and Uncle Sam are hoping you don't get there. They're both kinda screwed because people are living longer. So they raise your age to get the carrot.

 

[700UW]

This is just like what happened with Caterpillar closed the London, Ontario plant and is moving production to non-union facilities in Georgia and Texas when the CAW refused to give additional concessions and engaged in a crippling strike. How well did the Caterpillar strike in Joliet, IL go for the IAM? After a 15 week strike the union got down on their knees and gave Caterpillar everything they wanted, clearly the strike was financially difficult for the workers involved and they gave into the company. What about Lockheed Martin? Same thing happened, they eventually gave into the company demands. Fact is in the current environment even profitable companies are seeking concessions to remain competitive. In the collective bargaining process workers and unions are generally only striving to maintain what they have not even obtain higher wages, better benefits, work rules, etc.

Josh

Last time I checked this thread was about Hostess and why it failed, not about any other company.

Off topic.

 

[Kev3188]

Fact is a compensation committee was in place and determined the pay levels for the executives were appropriate for their expertise in the current environment. Its no different than a collective bargaining approach, union members expect market competitive pay aligned with what they contribute to the company and management is no different. I am familiar with how compensation committees are formed and operate. It seems you are disappointed they didn't consult with you.

So what is your point? Steve Jobs earned a salary of $1 in 2010, his final full year at Apple Inc. a solidly profitable and incredibly successful company. What you don't understand is the salary is only a small component of their total compensation. There are housing allowances, retention bonuses, performance bonuses, stock awards and other components to consider. In terms you may understand, its like cherry picking articles in a certain CBA and saying "Airline XYZ has the best work rules" without looking at the full picture.



http://online.wsj.co...0750545602.html

All valid points, but I think 700 was looking at the more symbolic side of things. A C-suite exec that takes a $1 salary- even if all the other compensation pieces stay- sends a loud message to the masses that he/she is "in it" with them. That can go a long way towards securing buy-in from the masses.

 

[737823]

Last time I checked this thread was about Hostess and why it failed, not about any other company.

Off topic.

No it is relevant because these are other examples of strike activities other unions have engaged in that have been unsuccessful. The unions at Caterpillar though the company would ultimately give into their demands but they didn't, CAT prevailed the unions gave them all the desired concessions at Joliet or in Ontario they shuttered the facility entirely.

Hostess's owners have decided to liquidate rather than ride out a nationwide strike by one of the largest of its dozen unions, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union. The Texas-based company owned by the private-equity shop Ripplewood Holdings and other hedge funds essentially gave up. On Friday it shut down its 33 bakeries and 565 distribution centers and prepared to fire nearly 18,500 employees en masse and auction off its brand and recipe portfolio.

This year management negotiated concessions from some of the unions, including the Teamsters, but the bakers rejected a last and best offer in September. Then the courts gave Hostess unilateral authority to modify collective-bargaining contracts, prompting the strike. So now it will liquidate, instead of attempting to emerge from Chapter 11 intact.
The 18,500 layoffs are equal to about 11% of the net new jobs the entire U.S. economy created in October. The unions are blaming private equity, or Bain Capital, or capitalism, but the election is over. And so is Hostess.

http://online.wsj.com/article/SB10001424127887324735104578123312646698662.html?mod=WSJ_Opinion_AboveLEFTTop

It also showed organized labor's willingness to test the boundaries of wage and benefit givebacks. During and after the 2008 financial crisis, auto workers and others readily agreed to concessions deemed crucial for survival. But this year, workers at Caterpillar Inc. and Hostess walked off the job instead. Caterpillar's union later relented.

http://online.wsj.com/article/SB10001424127887324556304578122632560842670.html?mod=WSJ_hp_LEFTWhatsNewsCollection

Josh

 

[SparrowHawk]

Last time I checked this thread was about Hostess and why it failed, not about any other company.

Off topic.

Seems perfectly on topic as it relates similar experiences elsewhere. My prediction is no matter how the BK judge rules you will soon see Twinkies in a store near you as someone will buy the brands and recipes. The workforce is toast as IMO NO ONE will buy Hostess and retain the plants or workers.

 

[700UW]

http://www.newyorker...he-twinkie.html

​

[background=rgb(255, 255, 255)]Management, of course, blames the company’s demise on the greedy, unreasonable unions. But, while the strike may well have sent Hostess over the edge, the hard truth is that it probably should have gone out of business a long time ago. The company has been steadily losing money, and market share, for years. And its core problem has not been excessively high compensation costs or pension contributions. Its core problem has been that the market for its products changed, but it did not. Twinkies and Ding Dongs obviously aren’t anyone’s idea of the perfect twenty-first-century snack food. More important, the theoretical flagship of Hostess’s product line, Wonder Bread, has gone from being a key part of the archetypical American diet to a tired also-ran.[/background]

​

 

[737823]

http://www.newyorker...he-twinkie.html

[background=rgb(255, 255, 255)]Management, of course, blames the company’s demise on the greedy, unreasonable unions. But, while the strike may well have sent Hostess over the edge, the hard truth is that it probably should have gone out of business a long time ago. The company has been steadily losing money, and market share, for years. And its core problem has not been excessively high compensation costs or pension contributions. Its core problem has been that the market for its products changed, but it did not. Twinkies and Ding Dongs obviously aren’t anyone’s idea of the perfect twenty-first-century snack food. More important, the theoretical flagship of Hostess’s product line, Wonder Bread, has gone from being a key part of the archetypical American diet to a tired also-ran.[/background]
​

No disagreement from me on the second part-I even mentioned in my first post that their product offerings had not evolved to reflect the new trends and consumer tastes. That is entirely managements fault.

However their costs were out of line and made it difficult for them to compete profitably:

Union work rules usually required cake and bread products to be delivered to a single retail location using two separate trucks. Drivers weren't allowed to load their own vehicles, and the workers who loaded bread weren't allowed to load cake. On most delivery routes, another "pull up" employee moved products from back rooms to shelves.

http://online.wsj.com/article/SB10001424127887324735104578123312646698662.html

Now, Kev explain to me though how work rules like this are reasonable. I understand they protect jobs by minimizing the activities per worker but I hope you can see that these work rules are incredibly restrictive and onerous. Why didn't the negotiators find other ways to protect the work through scope clauses than outrageous restrictions like these? It's like on many union construction sites they have to have an electrician (often one with high seniority) sit on a bucket and ride the elevator all day on a building nearly complete only because the job hasn't been signed off? Even though the elevator installation is complete, panel buttons work, etc. Just one example. Some work rules are so onerous that people can't leave their specified area or even pick something up off the floor when it drops.

Josh

 

[700UW]

The BCTGM did not deliver the products, that would be employees represented by the IBT.

Dont let the facts get in your way.

 

[737823]

The BCTGM did not deliver the products, that would be employees represented by the IBT.

Dont let the facts get in your way.

Again, this isn't specific to BCTGM this is still related to Hostess and the onerous work rules. As E posted earlier the BCTGM was trying to portray these unskilled baking jobs a skilled craft.

Josh

 

[700UW]

How do you know they are unskilled?

Have you worked in a bakery? Have you seen the machines that they operate?

Oh I forgot you know it all about everything sitting in your cubicle finding out new ways to foreclose on people's houses.

Funny how you wont admit who you work for or if your bank took TARP funds.

 

[700UW]

 

[Kev3188]

No disagreement from me on the second part-I even mentioned in my first post that their product offerings had not evolved to reflect the new trends and consumer tastes. That is entirely managements fault.

However their costs were out of line and made it difficult for them to compete profitably:



http://online.wsj.co...2646698662.html

Now, Kev explain to me though how work rules like this are reasonable. I understand they protect jobs by minimizing the activities per worker but I hope you can see that these work rules are incredibly restrictive and onerous. Why didn't the negotiators find other ways to protect the work through scope clauses than outrageous restrictions like these? It's like on many union construction sites they have to have an electrician (often one with high seniority) sit on a bucket and ride the elevator all day on a building nearly complete only because the job hasn't been signed off? Even though the elevator installation is complete, panel buttons work, etc. Just one example. Some work rules are so onerous that people can't leave their specified area or even pick something up off the floor when it drops.

Josh

No one ever gives up work rules unless either made to or made to *want* to. Perhaps management never offered up an appealing enough give-to-get to amend that language? If not, why not? Or, maybe after a couple of concessionary rounds, they felt it was an okay sop to leave in in order to make some of the other cuts more palatable.

That said, at the risk of sounding Clinton-esque, what does "usually" mean? Always? In certain areas? East of the Rockies?
Also, perhaps the "pull up" position -while sounding a bit much on paper- actually makes the route deliveries more efficient overall. Perhaps the segregation of trucks is an end result of throughput at the factory, or the design of the routings themselves? I'm being totally serious here, BTW; I think these are questions that should be addressed before one takes a WSJ article with a subtitle of "Unions kill an American classic, and 18,500 of their own jobs" at face value. Lots of cool soundbites, but not a lot of citations to back it up...