If the court approves its motion to impose a new collective bargaining agreement, but the bakers union strikes, Hostess Brands, Irving, Texas, will rapidly close its operations and begin the process of selling all of its assets, said CEO Gregory Rayburn after he told the U.S. Bankruptcy Court in southern New York in written testimony that acceptance of the company's offer is "the last chance to preserve our reorganization prospects and over 18,000 jobs."
The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union turned down the company's demands for union wage and pension concessions. If the union doesn't accept the offer, or workers strike, plants will close, Rayburn says.
If that happens, the company "suspects" it likely won't reopen, Rayburn adds. "For those that do (reopen), it is unlikely that new owners will provide union jobs," he says. "However, if our BCT-represented employees remain on the job, Hostess will have the ability to exit Chapter 11, revive its operations and continue providing jobs."
A "misinformation campaign" prompted the bakers union to reject the company's proposal to keep the financially troubled company afloat, Rayburn said in his written testimony.
Hostess filed for Chapter 11 bankruptcy protection in January. The company filed a motion Jan. 25 seeking authority to reject collective bargaining agreements with its two biggest unions, BCT and the International Brotherhood of Teamsters. The Teamsters, representing 7,500 of Hostess' 18,500 workers, voted to accept the offer, but the bakers union turned it down. The BCT local voted 39-1 later to reject the company's latest demands for concessions.
Rayburn says the union's leadership "wrote several letters to its membership that mischaracterized key elements of the proposal," assuring members "that a buyer was waiting in the wings to purchase some or all of the Debtors' bakeries as going concerns."
No buyer has stepped forward, Rayburn told the court. The company won the legal right last week to force the union to accept a proposed contract after its members overwhelmingly voted to reject it. Hostess will reportedly impose a new contract on the union soon, according to sources, despite growing signs that workers are prepared to launch a crippling strike.
Source: wefcourier.com, www.nypost.com