The 2014 '30 Under 30'

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Greedy union causes Hostess to shut its doors for good

A greedy union has struck Hostess Brands Inc. again, and this time because of its actions, Hostess is shutting its doors and Americans may never get the satisfaction of enjoying Twinkies, Ho Hos, CupCakes and other famous Hostess treats ever again.

Tensions have been high between both the union that represents the workers and management at Hostess after a contract was rejected in September by the workers that both slashed wages and benefits. The cash-strapped company was also rumored to be looking for outside investors to buy it out in order to keep the business afloat and restore wages and benefits for Hostess employees. This was ultimately the main reason for the strike that was initiated last week by The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, which represents more than a third of 18,o00 union workers at Hostess.

Shortly after the strike began, Hostess CEO Gregory Rayburn warned striking workers that unless the strike was settled by Thursday at 4 pm the company would be forced to file for bankruptcy and liquidate its assets.

Some thought the company was bluffing, but this was no joke, and on Friday morning the company filed for bankruptcy, closing 33 bakeries, 565 distribution centers, approximately 5,500 delivery routes, 570 bakery outlet stores and will lay off most of its 18,000 workers throughout the U.S., 6,500 of which were BCTGM members. In defending the company’s decision to file for bankruptcy CEO Gregory Rayburn said, “We simply do not have the financial resources to survive an ongoing national strike.”

Although the company says it will try to sell the brands that have made Hostess famous, the reality is that the bakery industry in general is one that is already overrun by a surplus of companies and products on the market. Some of Hostess’ more popular brands such as Twinkie may survive, but the likelihood of the company’s former employees retaining their jobs under new management is very minimal.

The shutting down of Hostess is yet another case of unions hurting the American worker, and this time not only will the employees and their families suffer, but adults and children around the country who love these tasty treats will, too.

 

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