We'll Miss The Twinkies

Talks between Hostess management and the Bakery, Confectionery, Tobacco Workers and Grain Millers Union failed on November 20th.  If a favorable agreement had been reached, over 18,000 jobs would have been saved.  It is unfortunate, but Hostess brand began terminating most of its 18,000 employees last week.  This action came after Hostess won court approval to shut down and start selling assets.

CEO Gregory Rayburn said 15,000 workers would be fired as soon as possible so that they could begin receiving unemployment benefits.  The Court ordered the Company to implement a non-executive employee retention plan to ensure the Company has the necessary personnel to implement the wind down.  Approximately 3,200 employees will stay on temporarily to clean plants and begin to wind down operations.  Employee headcount is expected to decrease by 95% within the first 16 weeks.  The closure of 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes, and 570 bakery outlet stores could take up to three months. 

WARN Act
In May, Hostess Brands Inc. mailed out WARN Act notices to its employees.  The WARN Act requires companies to give workers sixty (60) days notice before closing a facility or performing a mass layoff.  Spokeswoman Anita-Marie Laurie stated Hostess wanted to notify employees that a "sale or wind down of the company is possible in the future." 

On November 21st a former employee, Mark Popovich, filed for damages on behalf of himself and all employees laid off by Hostess.  "We believe Hostess violated the federal WARN Act as well as state laws.  These employees deserved better," said Charles A. Ercole, who filed the Complaint for Mr. Popovich.   Failure to give sixty (60) days advance notice violates the federal Worker Adjustment and Retraining Act. 

Hostess has a different viewpoint believing that the multiple notices issued throughout 2012 and the court declaration to layoff workers are sufficient to excuse it from WARN Act liability.

There are a lot of different versions as to who is to blame for the failure of Hostess and the loss of so many jobs.  Whether mismanagement or a union failing to make concessions, there are now 18,000 people facing unemployment.  The largest number of employees impacted are based in Irving, Texas.  I'm sad to say I haven't been able to find any information relating to job fairs for the Irving employees.    Texas, let's get moving on that shall we?  The Utah Department of Workforce Services and Ogden/Weber Technology College is hosting a job fair this Thursday for former Hostess employees. 

Hostess, previously with annual sales of about $2.5 billion, had been making 500 million Twinkies annually prior to the shutdown.  We'll miss the Twinkies. . . .