No more Twinkies - Hostess out of business

[Rupert Pupkin]

Originally Posted by GenuineRisk

Well, apparently while Hostess was failing, the CEOs were making sure they got theirs before 18,000 people lost their jobs:



http://gawker.com/5961444/dont-worry...pany-collapsed

I love how the failure of businesses is always blamed on greedy unions (how dare they expect their employers keep their end of their contracts!) but it's just shrugged off when the guys at the top loot the company on the way out.

I don't condone the behavior of either side in most of these cases. CEOs should not be making huge amounts of money when their company is doing lousy. By the same token, union workers should not expect to be getting raises and having huge pensions when their company is losing money.

I have done some work for a hedge fund for about 14 years. When things are going well, they have been generous to me. A few years back they were doing very well and they gave me a nice pay raise. But after about a year things went south and they told me that they could no longer afford to pay me the higher wage. They said they would have to go back to paying me what they were paying me before I got the raise. I didn't complain in the least bit. I totally understood the situation. The company was really struggling and they could no longer afford to pay me the higher wage. I had no problem with that.

I don't understand why people complain in those types of situations. When things are bad, everyone should have to bite the bullet.

[GenuineRisk]

Originally Posted by Rupert Pupkin

I don't condone the behavior of either side in most of these cases. CEOs should not be making huge amounts of money when their company is doing lousy. By the same token, union workers should not expect to be getting raises and having huge pensions when their company is losing money.

I have done some work for a hedge fund for about 14 years. When things are going well, they have been generous to me. A few years back they were doing very well and they gave me a nice pay raise. But after about a year things went south and they told me that they could no longer afford to pay me the higher wage. They said they would have to go back to paying me what they were paying me before I got the raise. I didn't complain in the least bit. I totally understood the situation. The company was really struggling and they could no longer afford to pay me the higher wage. I had no problem with that.

I don't understand why people complain in those types of situations. When things are bad, everyone should have to bite the bullet.

Rupert, it's not an equivalent situation. I'm assuming you were working without a contract, or that, in the event you were, the raise was not something promised in your contract; it was an extra goodie they gave you. I'm also assuming the heads of the company didn't give themselves a raise at the same time as they returned your salary to where it was a year previous (I don't know if you receive benefits from them, if so, I am also assuming they didn't cut those benefits. If I am incorrect, please correct me, and I apologize for incorrect assumptions). Compare with this from an actual Hostess employee:

I am a Hostess employee. Hostess stopped our pension contributions a yr & a half ago. Then they gave the top execs pay raises of 30-80%. They offered new contracts: no pension payments (no retirement plan at all for union employees, but company management still gets contributions to their retirement plans) for another 2 & 1/2 yrs, and then a 75% reduction in pension when they do start paying into it again; we have to pay an ADDITIONAL $200/ mo for health insurance; They took away our last cost of living raise; they gave us an 8% wage cut on top of that; they are outsourcing all of the office work to Manilla; they are closing 12 plants. THIS WAS ALL PART OF THE CONTRACT THAT WENT INTO EFFECT LAST MONTH!!

So, it wasn't a case of overpaid employees refusing to take a hit; it was a case of rank-and-file employees finally saying "Enough" after years of having their contracted compensation taken away and taken away by execs who continued to give themselves raises and compensation.

http://blogs.wsj.com/corporate-intel.../tab/comments/

Fact is, union members have taken cuts and done givebacks in many, many industries, and in return, the CEOs continue to give themselves rewards, and then complain that these very middle-class contracts cost too much money. Contracts that they agreed to years before, and now are unwilling to honor. And yet, somehow the companies can afford numerous six- and seven-figure CEO salaries.

There are several accounts at that link from Hostess employees. Well worth the read, to get an idea of what they've been going through the past several years.

[Rupert Pupkin]

Originally Posted by GenuineRisk

Rupert, it's not an equivalent situation. I'm assuming you were working without a contract, or that, in the event you were, the raise was not something promised in your contract; it was an extra goodie they gave you. I'm also assuming the heads of the company didn't give themselves a raise at the same time as they returned your salary to where it was a year previous (I don't know if you receive benefits from them, if so, I am also assuming they didn't cut those benefits. If I am incorrect, please correct me, and I apologize for incorrect assumptions). Compare with this from an actual Hostess employee:



So, it wasn't a case of overpaid employees refusing to take a hit; it was a case of rank-and-file employees finally saying "Enough" after years of having their contracted compensation taken away and taken away by execs who continued to give themselves raises and compensation.

http://blogs.wsj.com/corporate-intel.../tab/comments/

Fact is, union members have taken cuts and done givebacks in many, many industries, and in return, the CEOs continue to give themselves rewards, and then complain that these very middle-class contracts cost too much money. Contracts that they agreed to years before, and now are unwilling to honor. And yet, somehow the companies can afford numerous six- and seven-figure CEO salaries.

There are several accounts at that link from Hostess employees. Well worth the read, to get an idea of what they've been going through the past several years.

You are correct. I was working with no contract.

I agree with you that CEOs should not be getting pay raises when employees are getting pay cuts.