Union leader uncertain of Hostess snack cakes long-term viability
July 17, 2013
by Eric Schroeder
KENSINGTON, MD. — Even with the hype surrounding the relaunch of Hostess Brand snack cakes this week, David B. Durkee, president of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (B.C.T.G.M.), remains unconvinced of the company’s ability to recover.
“Despite the fanfare, the long-term viability of this effort is highly uncertain,” Mr. Durkee said in a July 12 letter about the relaunch. “Rather than hire professional, experienced bakers who have produced quality snack cakes in the company’s bakeries for decades, Hostess management has chosen instead to hire primarily workers with little or no experience in the demanding wholesale snack cake baking industry.
“The B.C.T.G.M. has consistently stated our interest in working cooperatively and productively with the new owners of this company. We have always maintained that the experience, skill and professionalism of our members offer the new owners, who have no experience in the wholesale snack cake business, the best chance for long-term success in consistently putting out a quality product.”
Mr. Durkee said Kansas City-based Hostess Brands, L.L.C.’s approach is different than that taken by Portland, Ore.-based United States Bakery, which bought the former Hostess assets in the northwest. He said United States Bakery decided the most effective way to achieve a seamless re-entry into the marketplace was to reopen the former Hostess bakery in Billings, Mont., with union workers.
“The B.C.T.G.M. and U.S. Baking recently negotiated a fair and equitable collective bargaining agreement, and the bakery is up and running, producing high-quality products,” Mr. Durkee said. “In fact, the workers there are earning more in wages in the first year of the contract than they were when Hostess closed the bakery last year.”
Mr. Durkee said he blamed Hostess’ demise last year to “critical mistakes made by a series of management teams that simply did not have any meaningful experience in the wholesale bread and cake baking business.”
“To avoid the same fate, the B.C.T.G.M. encourages the two private equity firms that own Hostess Brands, L.L.C. to change their approach and work with our union and our members in a cooperative manner,” he said. “This is their best hope for long-term success.
“As the process moves forward, the B.C.T.G.M. remains committed to taking all appropriate and necessary steps to protect the rights of our members and all Hostess Brands workers.”
In total, Hostess expects to have about 1,800 employees, none of which are unionized. By comparison, approximately 79% of the old Hostess Brands employees were part of a union.