Judge Authorizes Hostess to Reject Union Contracts

A bankruptcy judge has given Hostess Brands, Inc. permission to reject IAM contracts and to implement unfair changes on nearly 200 IAM members employed by Hostess. Hostess filed for Chapter 11 bankruptcy protection in January 2012 and is seeking changes to its current labor contracts.

The vehicle and building maintenance workers represented by the IAM voted Hostess’ “last, best and final” offer down by a 65 percent margin.  Hostess’ offer included significant changes to the workers’ wages, pensions and job security. However, a bankruptcy judge in New York ruled on October 4th that Hostess could ignore the members’ vote and impose the changes on the membership as part of its bankruptcy reorganization.

“The IAM presented a strong case in court explaining why our members rejected the Company’s final offer,” said IAM Collective Bargaining Coordinator Jim Price. “In the end, the judge ruled that our arguments were outweighed by the imminent liquidation of Hostess if the terms of the final offer were not imposed on all of the Company’s unions.”

In addition to the Machinists, the ruling applies to members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union; the International Union of Operating Engineers and Service Employees; the International Brotherhood of Firemen and Oilers; the United Brotherhood of Carpenters and Joiners of America; and the Glass, Molders, Pottery, Plastics and Allied Workers International Union.

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