Maybe the gap in trust between management and the union had simply grown too wide. The last CEO, Brian Driscoll, had seen a big salary increase. He was abruptly replaced by [Gregory F.] Rayburn earlier this year, who was the sixth head of the company in the last decade. That kind of turnover is not typically a good environment for labor relations, in which a history of past successes between leaders and unions can be drawn upon for future goodwill.
Or more likely, the union workers kept at the strike because the last time the company had threatened liquidation, it didn’t follow through. During its last stint in Chapter 11, the company said “a vote against its last, best, final offer by either of its two largest unions would prompt an immediate liquidation,” the Journal reports. “But when the bakers union gave Hostess just that trigger, Hostess instead decided to take its case back to the court.” When leaders do that, it’s harder for the people who work for them to take the threats seriously the next time around.
This Fortune story offers some more details on how it went down.
21:05 // 1 year ago