Hostess is Toast

[Albort]

China.

And Diana Sawyer will go there to investigate.

naw, give it to Japan... maybe they can create HD Twinkies.

 

[JennaDeeDooDah]

China.

And Diana Sawyer will go there to investigate.

I just had an amusing mental image of the Chinese eating Twinkies and making our Olympic Ceremony uniforms.

 

[Anjelica]

Have they or will the employees lose their pension balances? I assume they had a cash value of their existing pensions.

 

[ilovemk76]

You're talking consulting type work. I'm talking laborers. If someone shows up the machine shop every day to work the same hours doing the same job, should he be an independent contractor?

You statement said, "Independent contractors are just an excuse for a business to not pay insurance or social security on an employee." When others show that your statement is not true you just reinvent what you said.

Many laborers in construction, for example, are independent contractors. It has been like that for as long as I can remember.

All the independent contractors I know go to the same place every day, work the same hours and do the same job every day. Some have been at the same place for over a decade. Independent contractors go back over a century. They are not a new invention.

 

[Hollywoodhaha]

NOO! Wonder bread

 

[luvsJack]

Again, if someone feels the company they work for treats them like dirt, they are free to leave that company, are they not?

And go where, exactly?

Not just talking to you, luvmy3 but I see this so many times in these types of threads. "If you don't like the working conditions, find another job". There are no other jobs.

 

[sadiras]

China.

And Diana Sawyer will go there to investigate.

Yes, China. Trinkies with a fortune in the middle.

 

[goofyintoronto]

Let's be fair. Everyone is "greedy" because everyone wants to make money. Now, in this specific situation, Hostess told the Union workers that they (Hostess) could no longer contribute 2% towards their (the union) retirement and that the union would need to pick up that tab. They told the union that if they (Hostess) continued to contribute that amount, it would put them out of business. The union refused to budge and now EVERYONE is out of a job. In this specific situation, it sounds like the union was greedy and uncaring.

 

[castleview]

You statement said, "Independent contractors are just an excuse for a business to not pay insurance or social security on an employee." When others show that your statement is not true you just reinvent what you said.

Many laborers in construction, for example, are independent contractors. It has been like that for as long as I can remember.

All the independent contractors I know go to the same place every day, work the same hours and do the same job every day. Some have been at the same place for over a decade. Independent contractors go back over a century. They are not a new invention.

Those would be subcontractors who would OWN their share and take it into their own hands. I'm talking about those that don't.

 

[castleview]

For you, the glass is always half empty.

No, I'd say it's half full because I believe people can be good and do the right thing. You, on the hand, seem to think it's natural for people to be devious and uncaring. So I'd say you're the one who is a little pessimistic.

 

[pumpkinmomma]

Have they or will the employees lose their pension balances? I assume they had a cash value of their existing pensions.

I read in a Fortune article (from back in July) that they owed about $2 billion in unfunded pension liabilities so who knows what will come of that. Probably a good bet that the employees will lose out on a lot of their pensions.

 

[castleview]

"sounds" being the operative word. While I have no love your unions, they were either going to screw their members by taking another cut or this.

 

[DisMN]

Have they or will the employees lose their pension balances? I assume they had a cash value of their existing pensions.

I'm going to go out on a limb here and say that their pensions will mysteriously vanish
... (into the coffers of the higher ups. VERY common. happened to my husband with his 28 year pension. months later we find out that one of the bigwigs had a beautiful new second home built that included gold plated toilet fixtures.)

Of course PBGC will cover them but only at a small fraction of what they should have been, and that's if the PBGC itself survives.

 

[luvsJack]

So an employee with a high school education chooses to work as an independent contractor? I don't think so. My state just kept Linda McMahon from becoming a senator and one of the biggest gripes was that her wrestlers in the WWE were paid as independent contractors even though it's a physically taxing job.

As for the companies that did leave, they probably had no intention of staying. They were just trying to put the onus on someone else and some people still fall for that.

This is totally off topic, but why was the wrestlers being independent contractors a problem? It is a physically taxing job but most would rather be independent contractors at least until they get a big contract because they are free to jump from organization to organization.

 

[FireDancer]

And go where, exactly?

Not just talking to you, luvmy3 but I see this so many times in these types of threads. "If you don't like the working conditions, find another job". There are no other jobs.

I have friends and acquaintances in local professional groups that have a hard time filling the jobs they have opened. One was trying to fill somewhere around 15 accounting jobs and it took them all summer to get enough qualified applicants, many from out of town, even though they tried to fill all the positions with local applicants. I get jobs emailed to me at least weekly from them looking for IT people to see if I can recommend any.

As long as you have in demand skills and make the right contacts there are jobs out there. Yes, some jobs that were once plentiful are going away but that is what happens as technology and society evolves. If I wasn't willing to expand my skill set constantly I would quickly be obsolete. The skills I had when I graduated college even in 2003 would get me nowhere had I not continually added onto them. There are people out there that haven't expanded their skill set in decades. That just isn't good enough in the modern world. It might suck, I'm sure it does for many, but you have to roll with change.

 

[DisMN]

I don't think it's quite that simple. I think it gave the hedge funds an excuse to liquidate the company without looking like the bad guys. The end game was always liquidation.

Gosh, does that ever sound familiar.

I don't either. More power to people who do well for themselves; however, I do agree with the other posters that say some go to far. As stated above, many corporations do get huge "local" tax breaks and incentives to hire workers as well as all sorts of other write offs. I do believe that employers who have a thriving business owe just a tad bit more to an employee than a "just a job." It's fine that we can say the Hostess workers were low-skilled, low income folks or that folks in these types of jobs don't deserve much. That's also a bit of a misconception. Working in a plant, food line, assembly line, almost always takes some sort of skills/smarts to run the equipment, troubleshoot the equipment, and just be safe on the equipment.

Corporations have been "lucky" in this economy that people are far more desparate and are willing to work jobs that don't pay for their skill sets. I think the economic downturn, coupled with the lack of worker protections, have made employees easy prey for greedy corporations. I think you can be rich AND have a conscience.

You said a mouthful and I agree with every word!

 

[Anjelica]

I started looking at more articles after I posted the question - but their pension funding was interesting - it quotes the fortune magazine article some had elluded to. I had no idea that some pensions are backed by multiple employers.

http://moneymorning.com/2012/11/16/hostess-brands-shutdown-highlights-looming-pension-crisis/

"The biggest issue is that Hostess' union pension funds are underfunded by $2 billion. Under its agreements with the unions, Hostess is required to contribute to multi-employer pension plans (MEPPs). MEPPs provide pension benefits to workers within a particular trade, regardless of what company they work for. The concept was that all companies employing workers in a particular trade would contribute to the trade pension fund so that workers would not lose their pension benefits if they changed employers.

Fortune writes, "Trouble with MEPPs is, if some employers go out of business, the remaining companies have to pick up the shortfall in funding benefits. When there are too few employers left standing, the fund is in trouble...A third of the 40 MEPPs to which Hostess contributes are among the most underfunded plans in the country."

With Hostess gone, all of the remaining companies contributing to the MEPPs serving Hostess employees will now have to pick up the slack left by Hostess. "

 

[Gumbo4x4]

I don't either. More power to people who do well for themselves; however, I do agree with the other posters that say some go to far. As stated above, many corporations do get huge "local" tax breaks and incentives to hire workers as well as all sorts of other write offs. I do believe that employers who have a thriving business owe just a tad bit more to an employee than a "just a job." It's fine that we can say the Hostess workers were low-skilled, low income folks or that folks in these types of jobs don't deserve much. That's also a bit of a misconception. Working in a plant, food line, assembly line, almost always takes some sort of skills/smarts to run the equipment, troubleshoot the equipment, and just be safe on the equipment.

Corporations have been "lucky" in this economy that people are far more desparate and are willing to work jobs that don't pay for their skill sets. I think the economic downturn, coupled with the lack of worker protections, have made employees easy prey for greedy corporations. I think you can be rich AND have a conscience.

Just to be clear, I don't know that anyone is specifically suggesting the bakers' union members were low skill or overpaid. Frankly, I don't know anything about those specific jobs or what the pay was.

 

[ilovemk76]

And go where, exactly?

Not just talking to you, luvmy3 but I see this so many times in these types of threads. "If you don't like the working conditions, find another job". There are no other jobs.

There may not be other jobs 5 minutes from your house, next to mom, in your hometown, in your state or on your coast but there are other jobs.

 

[ilovemk76]

No, I'd say it's half full because I believe people can be good and do the right thing. You, on the hand, seem to think it's natural for people to be devious and uncaring. So I'd say you're the one who is a little pessimistic.