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Topics: Labor Unions

Labor clashes likely to follow return of Twinkies

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Politics,Beltway Confidential,Sean Higgins,Labor unions

Catching up a little bit on the news, the Wall Street Journal reported late last week that the makers of Twinkies and related sugary snack cakes are gearing up to return to business:

Hostess Brands LLC — Metropoulos & Co. and Apollo Global Management LLC’s new incarnation of the baking company that liquidated in Chapter 11 — is reopening four bakeries in the next eight to 10 weeks, aiming to get Twinkie-deprived consumers the classic snack cake starting in July.

Chief Executive C. Dean Metropoulos said the company will pump $60 million in capital investments into the plants between now and September and aims to hire at least 1,500 workers. But they won’t be represented by unions, including the one whose nationwide strike sparked the 86-year-old company’s decision to shut down in November.

“We do not expect to be involved in the union going forward,” Mr. Metropoulos said in an interview Wednesday.

Labor strife between management and the Bakery, Confectionery, Tobacco Workers & Grain Millers International Union was cited as the reason why the company closed doors in November. The union went on strike and management liquidated operations, costing an estimated 18,500 workers their jobs.

The bakery’s management said the union refused to deal on a new contract. The bakers union denied this, but the Teamsters, who also represented some Hostess employees, said the bakers’ union knew the company was in an untenable financial position.

The Journal story indicates that the bakers union is going to try to get back in the Hostess operation:

President David Durkee said the strike had left the union in “a position of strength,” and he expressed confidence its workers would get a better deal from the new owners than Hostess offered during the bankruptcy case, its second in recent years.

He added that the only way for the brands to have a “seamless restart” would be to hire back unionized bakers. “Only our members know how to get that equipment running,” Mr. Durkee said. “A work force off the street will not be able to accomplish that.”

Presumably the Teamsters will try to get back in, too. A key problem for both is that the new Hostess facilities are smaller: from 11 plants last year to just four now, with a fifth possible. That will mean a smaller workforce. So, this fight could get bitter between both the management and labor and between the unions, since the Teamsters essentially sided with management before.

 

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