Hostess the company that makes Twinkies and Ding Dongs has presented cost cutting measures to workers and bakers unions for their approval before the court forces the cuts.
Hostess and their bankruptcy attorneys presented the Teamsters and the Baker’s Union with a new labor contract which they rejected and then filed a counter offer. The new contract would require reduced benefits and changes in work rules.
Hostess CEO Greg Rayburn stated the bakery plans to push ahead with their proposed plan and will ask the bankruptcy court to throw out the union’s collective bargaining rights. A measure which Union leaders have warned will cause a walk out. The Unions maintain that Hostess is abusing the bankruptcy court in order to relive itself of obligations to workers. And those workers made many sacrifices during previous Hostess bankruptcies
Rayburn countered by asserting that a walk out would force Hostess to close and liquidate.
Hostess filed for Chapter 11 in January, their third time in bankruptcy protection in a decade. Bankruptcy lawyers find that Chapter 11 reorganization gives the company the opportunity to pay down and reduce their debts while they continue conducting business.
Bankruptcy is often the only option a troubled business or individuals have to shed their overwhelming debt. An accomplished bankruptcy attorney can detail the different structures and advise an indebted company on which structure will be best for their needs.