Black Listed News

Hostess Diverted Pension Money to Run Business

December 11, 2012
Share It | Print This

Source: Newser

Hostess twinkies

For months, Hostess diverted funds intended for employee pensions and used that money to help run the sagging business, the Wall Street Journal reports. It's not clear how much workers lost, and experts say it probably wasn't illegal, but Hostess CEO Gregory Rayburn admitted it was a "terrible" thing. "I think it's like a lot of things in this case," he said. "It's not a good situation to have." The move affected bakers union employees—not Teamsters—because only the former contributed from their wages to pension funds.

But how much bakers lost is unclear, because retirees at Hostess are paid by a "multiemployer pension plan" that's funded by several companies in the business. Jeffrey Freund, a lawyer for the union, said Hostess missed $22.1 million in payments during the five months preceding the company's bankruptcy filing in January, and another $3 million to $4 million per month until Hostess and the union failed to reach an agreement. "The company's cessation of making pension contributions was a critical component of the bakers' decision" to go on strike, said Freund.

Read More...

Share This Article...


Subscribe To Updates
Blacklisted Newsletter
Blacklisted Radio
Blacklisted Nation
On Twitter
On Facebook
The DoomCast
Podcasts on Demand
Podcasts on Spreaker
Podcasts on Youtube
Podcasts on iTunes
Podcasts on Stitcher
Podcasts on Tunein
Podcasts on Roku

Support Us
Donate Today!

Affiliates
Golden Eagle Coins
6 Dollar T-Shirts
DHGATE.COM
GoldSilver.com
The Ready Store
Onnit Labs
Audible Audio Books
Amazon.com
Blue Host



BlackListed News CC 2006-2014