Northeast Times

Hostess calls it quits, pickets leave bakery

The Pres­id­ent of Mont­gomery County AFL-CIO, Barry Fields, says he is very dis­s­a­poin­ted after Host­ess an­nounces it’s clos­ing due to bank­rupcy since na­tion­wide protests began last week. He says he plans on con­tinu­ing the strike un­til they are giv­en a no­tice to move from the premis­ice. (Maria Pouch­nikova)

There were no pick­ets walk­ing the line at the Host­ess plant on Monday morn­ing. 

“It’s over,” said Somer­ton res­id­ent John Phil­lips, who had worked at the Blue Grass Road fa­cil­ity for sev­en years. “They’re shut­ting the place down.”

He said Fri­day was the last day strik­ing em­ploy­ees walked out­side the North­east plant where bread and donuts are baked. There were about 300 work­ers at the Blue Grass Road loc­a­tion. Some man­age­ment work­ers were in­side on Monday, said Phil­lips, who was there to try to col­lect some per­son­al prop­erty from a lock­er.

Phil­lips, who had worked a bread pro­duc­tion line, said the baker’s uni­on called a strike in early Novem­ber.

Had the uni­on ac­cep­ted an 8 per­cent pay cut and high­er be­ne­fits costs, he wouldn’t now be out of work, he said.

Calls to the uni­on and the com­pany were not re­turned.

The last entry to a Web site the com­pany set up was Nov. 21. It said it ex­pects to re­tain 3,200 of its 18,000 em­ploy­ees, while it shuts down and sells off its as­sets. The com­pany said 94 per­cent of its em­ploy­ees will be gone with­in 16 weeks and that the shut­down would be com­plete in a year.

Host­ess said the strike “crippled its op­er­a­tions at a time when the com­pany lacked the fin­an­cial re­sources to sur­vive a sig­ni­fic­ant labor ac­tion.”

The com­pany said it would close 33 baker­ies, 565 dis­tri­bu­tion cen­ters and 570 bakery out­let stores, and end about 5,500 de­liv­ery routes.

The lead­er­ship of the Bakery, Con­fec­tion­ary, To­bacco Work­ers & Grain Millers In­ter­na­tion­al Uni­on said the in­vest­ment firm that took con­trol of the Irving, Texas-based Host­ess Brands three years ago is run by “vul­ture cap­it­al­ists” who have mis­man­aged the com­pany, The New York Times re­por­ted last week. The uni­on charged com­pany ex­ec­ut­ives got big raises while in­sist­ing uni­on work­ers take pay cuts and pay more for be­ne­fits.

Host­ess, fam­ous for Twinkies and Won­der Bread among its 30 brands, emerged from bank­ruptcy in 2009 when Ripple­wood Hold­ings, a private equity firm, took the com­pany’s reins. The Times re­por­ted Ripple­wood sank $130 mil­lion in­to Host­ess, which it likely will lose.

Host­ess man­age­ment, the Times re­por­ted, in­sisted labor costs and work rules along with mil­lions of dol­lars in work­er’s com­pens­a­tion claims made the busi­ness un­sus­tain­able. The com­pany went in­to bank­ruptcy again this year and got per­mis­sion to li­quid­ate its as­sets after the bakers went on strike Nov. 9. Last week, Robert D. Drain, a fed­er­al bank­ruptcy court judge, ordered a fi­nal try at ne­go­ti­ations, but when talks went nowhere, he OK’d li­quid­a­tion of the com­pany as­sets.

Phil­lips, who had been laid off three times dur­ing his first three years at the plant, said he ex­pec­ted an­oth­er com­pany will buy Host­ess’ North­east site and that it would be up, run­ning and hir­ing with­in months.

“They’re go­ing to shut down, open up in a couple months and say, ‘You wanna work here? There’s no uni­on,’ ” Phil­lips pre­dicted.

That’s prob­ably what will hap­pen, state Rep. Kev­in Boyle (D-172nd dist.) said in an in­ter­view Monday. The Blue Grass Road plant is in Boyle’s dis­trict.

ldquo;You’ll see work­ers go back with lower wages and re­duced be­ne­fits,” he said. That will be a re­peat of what has been hap­pen­ing for dec­ades, he said.

What happened to Host­ess, Boyle said, is part of the broad­er eco­nom­ic story — the erosion of the middle class.

“We will be­come weak­er,” he said, “if we al­low the work­ing class to be­come poor. ••

Re­port­er John Loftus can be reached at 215-354-3110 or jloftus@bsmphilly.com

You can reach at jloftus@bsmphilly.com.

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