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Since Hostess Brands filed for Chapter 11 bankruptcy on Jan. 11, the Bakery Confections, Tobacco Workers and Grain Millers International Union and the International Brotherhood of Teamsters are preparing for a ...
Since Hostess Brands filed for Chapter 11 bankruptcy on Jan. 11, the Bakery Confections, Tobacco Workers and Grain Millers International Union and the International Brotherhood of Teamsters are preparing for a company-wide strike.
A Bakery Confections International Pension fund freeze for Dolly Madison employees was supposed to end Jan. 1, but did not because of Hostess Brands filing for restructuring bankruptcy.
This is the second time the Dolly Madison parent company has filed bankruptcy. Hostess filed bankruptcy in September 2004 as Interstate Bakeries and came out of bankruptcy in 2009. During the restructuring, employees were asked to contribute $10 per week back to Hostess to help the company rebuild. Workers continue to pay the $10.
Hostess was not open to negotiation at a preliminary meeting between the union and the company, said Linda Bartley, the local Bakery Confections, Tobacco Workers and Grain Millers International Union representative.
?The company told the unions ?take it or leave it,?? said Bartley about the Letter of Understanding for the Restructuring of Hostess Brands that was submitted to a New York bankruptcy judge. ?So that?s why we are preparing to strike because we can?t accept that.?
Hostess and the Unions will meet again and the Bakery Confections, Tobacco Workers and Grain Millers International Union will meet with the bankruptcy court Feb. 28.
?The judge gave the company and union until then to come up with something to settle out of court and at that time if we can?t, then rule on what he thinks needs to happen,? Bartley said. ?If it goes south then we need to strike.?
?As we head into this we are actually believing they did it simply because our labor agreements are expiring this spring,? Bartley said. ?They gave a 20-page confession packet to the judge, in New York is where they filed. It stripped pretty much everything in the labor agreement ? the pension, retiree insurance, a wage freeze until 2015. We have a death benefit called the P plan for $15,000, overtime after 8 hours, guaranteed 40-hour work week. It stripped pretty much everything.?
Text from the Letter of Understanding for the Restructuring of Hostess Brands says the following; ?(I) Overtime, (J) Eliminate all contractual requirements for paying daily overtime. Overtime will be paid only after 40 hours per week. Daily Guarantee: Eliminate any contractual requirements for eight-hour daily guarantee. Eliminate 7 1?2 hour daily guarantee for units with a 37 1?2 hour workweek; eliminate seven-hour daily guarantee for units with a 35 hour workweek. (K) Wages: All wages are frozen through the new expiration dates (attached). All Hostess Brands employees are subject to a salary freeze. (L) Eliminate Earned Work Credit pay-out.
?(M) Health & Welfare: Effective the first of the month or as soon as possible following the effective date of this Agreement, employees will be covered under the attached company-administered Health & Welfare plan. This plan does not include retiree coverage. A joint labor-management H&W board will be established to review annual plan performance/economics and will provide the Hostess Brands Board of Directors an annual presentation and recommendations. The Company is prepared to discuss alternatives that address and achieve the same economic objectives associated with moving employees to the attached Company Health & Welfare plan. (N) Eliminate W-1 and P-Plan contributions.
?(O) Pension: (1) Effective the first of the month following the effective date of this Agreement, the Company will permanently cease to be obligated to contribute to any Multi-Employer Pension Plan (?MEPP?), and will completely withdraw from each such Pension Plan (within the meaning of Section 4203 of ERISA). (2) Effective as of the date of withdrawal from the MEPPs, employees previously covered by a MEPP will commence participation in a newly established, jointly trusteed, single employer defined benefit pension plan (?DB plan?) and a newly established, jointly trusteed, defined contribution plan (?DC plan?) in accordance with the following: (a) During the first year of the agreement, the Company will set aside a total of $4.1 million for retirement benefits for all employees represented by the BCTGM. Effective the second year of the agreement, the Company will increase its contribution to $5.5 million and effective the third year of the agreement, the Company will increase its contribution to $8.2 million.?
ABC News reported that more than 90 percent of the International Brothers of Teamsters? Hostess members voted to authorize a strike if the terms in the Letter of Understanding for the Restructuring of Hostess Brands are approved in the bankruptcy proceedings.
The freeze of the Bakery Confections International Pension fund for Dolly Madison employees started Aug. 1. Employees? $3.40 per hour contributions to the pension fund, which falls under the Taft-Hartley Act, stopped being contributed by Hostess.
Because of the pension freeze, the Bakery Confections Tobacco and Grain Workers? Union has filed a lawsuit in federal court to recover the $3.40 per hour contributed by the employees that was not contributed to the Bakery Confections International Pension by Hostess during the freeze.
During the freeze, Hostess has been expelled from the pension fund for not contributing to the fund for four months. Because of the expulsion, Hostess lost its representative who sat on the 14-panel board of trustees. The board is comprised of seven union and seven company representatives.