Breaking: Hostess Enters Mediation-Can It Be Saved?
In a last ditch effort to save Hostess Brands, bankruptcy judge Robert Drain arranged mediation talks between management and the Bakery Workers union. CNN Money reports that one day of negotiations has been scheduled for Tuesday, November 20. The judge has postponed ruling on management’s liquidation motion until Wednesday.
A bankruptcy judge has enormous leverage in most proceedings and parties generally feel obligated to defer to his wishes. It is unclear if management will improve its last offer to the union, which called for an 8% wage cut and reductions in employee benefits, or if the union is now willing to accept a concessionary contract as liquidation looms over the horizon. The Bakery Workers union is also under tremendous pressure from the Teamsters, whose members narrowly accepted their own concessionary contract in order to save their jobs.
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