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At Utah job fair, ex-Hostess workers try to move on

Published November 30, 2012 7:53 am

Labor • Word of bonuses for company execs shrouds day of hope in more hurt.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Ogden • As former Hostess workers in Utah lined up at a job fair staged on their behalf Thursday, many were aware that on the other side of country company executives had won approval for up to $1.8 million in bonuses for themselves as part of the company's wind-down plans.

Before declaring bankruptcy earlier this year for the second time in a decade, Hostess employed about 600 people in the state at two bakeries, nearly a dozen retail stores and nine depots. But those were among 18,000 jobs nationally wiped out last week when a judge gave initial approval for the company to liquidate.

On Thursday, more than 200 former employees showed up at the Ogden-Weber Technology College for interviews with more than 30 prospective employers at an event sponsored by the college and the Utah Department of Workforce Services.

Organizers estimated that about 180 jobs were available from the likes of the Lofthouse, Kroger, Kellogg's, FedEx, CSM Bakery and U.S. Food Services. But feelings were still raw among the applicants, many of whom had worked for hostess for years and saw the executives bonuses as yet another punch to the gut.

"Executives are giving themselves fat paychecks after they've put us out of work," said Robert Klein of Ogden, a 10-year Hostess veteran. "That shows how bad they mismanaged the company."

A financial adviser for Hostess Brands Inc., maker of Twinkies and Wonder bread among other iconic brands, told the bankruptcy court judge in New York Thursday that the bonuses were necessary because the executives had met certain budget goals during the liquidation and the company needed to retain 19 corporate officers and "high-level managers" for the wind down process, which could take about a year.

"There's probably some brain power there," said Megan Hadley of North Ogden, who had worked six years for Hostess. "But it seems like a slap in the face for all the work that we've done."

Hostess also told the court that the company no longer is able to pay retiree benefits, which come to $1.1 million a month.

Jerry Vanderberg of Ogden, a 17-year Hostess veteran, said he will lose $15,000 in pension benefits.

"The money is gone, and I can't get it back," he said. "I have always tried to do the best job that I could."

Hostess had been in process of trying to win new labor agreements but had been unable to reach a new contract with its second-largest union, the bakers union, which rejected the terms and went on strike Nov. 9. Hostess announced its plans to liquidate a week later, saying it "lacked the financial resources to survive a significant labor action."

Last year, when the company was mired in almost $1 billion in debt, then-CEO Brian Driscoll tripled his salary while other top executives received 35 percent to 80 percent raises, according to The Wall Street Journal.

Former workers in Utah pointed out that full-time bakers were making $35,000 per year — down from the $45,000 they were making five years ago as part of concessions the union had given to Hostess. More recently, factory workers were asked to take another 8 percent cut in pay and a 17 percent reduction in health benefits.

Brian Hill of Layton, a five-year company veteran and non-union employee, said he doesn't begrudge the company his pay cuts "because that's what I agreed to do. I'm probably better off than most because my kids are grown, I'm single and I have some savings."

Said Edith Stopka, Roy, who worked for the company for two years: "I'm looking to the future. I'm hoping for a new day."

Associated Press contributed to this report —

Hostess shuts down

Utah • Employed 600 people working at two bakeries, nearly a dozen retail stores and nine depots

U.S. • 18,500 people working at 33 bakeries, 570 retail stores, 565 distribution centers and 5,500 delivery routes in 22 states

Company • Received approval to give top executives bonuses totaling up to $1.8 million as part of its wind-down process

Bakers union • Asking judge to appoint independent trustee, rather than "woefully unsuccessful" managers to oversee liquidation —

Job opportunities, retraining

O Visit jobs.utah.gov