Twinkies Aren't Going Anywhere! Company Ordered Into Mediation
Hostess Brands was ordered to undergo mediation with its union
Hostess Brands is not going out of business just yet. USA Today reports the maker of Wonder Bread, Twinkies and other assorted sweet treats will go into mediation with members of its second largest union instead.
The Texas-based company's liquidation request in bankruptcy court was today and a judge determined that the two parties hadn't gone through the critical step of mediation. He instructed the lawyer for the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union to ask if the union would agree to participate. No one from the union was present at the hearing.
The judge noted that the bakers' union went on strike after rejecting the company's latest contract offer, even though it never filed an objection.
"Many people, myself included, have serious questions as to the logic behind this strike," said Judge Robert Drain. "Not to have gone through that step leaves a huge question mark in this case."
Union workers walked off the job on Nov. 9, after the company offered a new contract with what workers called "extreme" wage and benefit cuts. Hostess alleged that the strike was what forced them to close their doors.
The Daily Kos outlined some of the demands worker allege were made by Hostess, including a 27 percent pay cut over five years and total withdrawal of all pensions.
In addition to the union, Hostess was facing off against an agent from the U.S. Justice Department, who said the company's wind-down plan included excessively generous and improper bonuses paid to company insiders.
The 82-year-old snack maker sought permission to pay senior management a bonus of up to 75 percent of their annual pay so they would stay on and help shut down the business, according to reports from the Chicago Tribune.
Hostess and the union are expected to begin the mediation process on Tuesday.