Although Hostess was able to strike a deal with its largest union, International Brotherhood of Teamsters, it was not able to do so with its second largest union. Union members went on strike to protest the cut in wages and benefits that occurred in September of last year. This inability to negotiate has cost Hostess dearly and is a direct result of the strike says the CEO. Although Rayburn claims he has been, "straightforward" in his approach, the Baker's Union says that the union members and workers have no responsibility for the failure of the company. Some are hoping that this was a last ditch effort to get the members back to work, but Rayburn says "that's it."
While the company is blaming the unions, the unions are blaming the company. They claim it was a result of mismanagement and "Bain Style Wall Street" tactics. Union members are saying it was a needless layoff and now thousands are going to be unemployed, despite the fact that the company was running under 50% capacity and customers weren't getting products due to the workers being on strike.
4 comments:
Considering that Hostess had gone bankrupt a couple of times in the past decade, the cutbacks to workers' pensions were unfortunate but basically inevitable. With the recession and junk food concerns, Hostess shutting down was more of a matter of time than the fault of the workers or the company. I believe the company did the best they could with negotiations and while the strikes hindered production,unions shouldn't be blamed for trying to get what workers deserve. Hostess going out of business will definitely affect tens of thousands of workers but for health's sake it is probably best that Chocodiles will cease to exist.
Workers do have the right to strike for their rights. If Hostess was truly cutting back on their benefits, such a situation was fairly inevitable. With the company's financial situation as poor as it was, the shut down of the factory was also probably imminent. Although I find it unfortunate that it came to this, and that so many other workers' jobs will be lost as a consequence, not to mention all those working for any branch of Hostess, this is just the way the economy works. Blame should not be pointed in only one direction, because it is a fairly multifaceted issue. The company should have tried harder to meet the needs of the strikers, but perhaps were truly unable to. The strikers also could have been more mindful of the consequences of their strikes, but they did have a right to strike for their rights and if this is what it came down to then so be it. The loss of Twinkies and Ding Dong's will affect many Americans, but somehow I think we'll all make it through.
It's interesting to see a company as well-ingrained in American pop-culture like Hostess was go down without a fight. By that, I mean that while Hostess definitely took aim at workers' wages and benefits, they never saw the problem inherent in their company. They were a dinosaur of sorts: manufacturers of products that epitomize American junk food that existed in the health-crazed 21st century.
My point is that, to my knowledge, Hostess never tried to rebrand themselves or change their image. I've always known and accordingly avoided their products because of their notorious lack of nutritional value (and frankly I never found eating insulating foam with a healthy side of preservatives to be that appealing). Yet Hostess didn't try and shake this image when other companies have gotten the message (cough McDonald's- now with salad flavored lettuce!). So maybe this failure was inevitable due to the shifts in their audience. Or maybe they're just really bad at running a business. I'm not sure which is true here.
On an unrelated note, apparently eating Twinkies used to be a somewhat viable defense in a court of law.
Dear god no. Not our precious Twinkies! Will there even be a point in going to the County Fair if we are unable to purchase deep-fried Twinkies???
At any rate, I think that it is hard to point the finger of blame to just one group of people. Yes, failed management bankrupted the company, so you could blame them. However, the workers are also to blame because, after all, they did go on strike.
I think that the issue isn't quite so black and white though--there are still many outside causes that could have hurt Hostess. I like and agree with Andrew's idea that Hostess has failed to change its image to match their environment. In a time where supposed "health" is important to many, Hostess did not adjust its products to reflect that and, they we were viewed as an unhealthy company (which is probably true).
Oh well, I didn't eat Twinkies anyway.
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