Almost 300 people are out of work after the closure of the Merita Interstate Brands bakery Friday morning in Rocky Mount.
The bakery shut down after its parent company decided to liquidate its properties nationwide.
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The move was made in the wake of strikes by some employees, statements by company officials said. However, union officials denied that their workers were at fault.
“Hostess has closed all of its bakeries and ceased operation,” an automated phone message at the plant said Friday morning. “If you are an employee, please do not come to work. The company’s assets are for sale.”
A group of 20 to 30 workers continued to picket Friday morning in front of the plant at 2551 N. Church St. as other employees drove away. The picketers are members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union.
The bakery employed 286 workers.
Hostess Brands, maker of Twinkies and Wonder Bread, which recently filed for Chapter 11 bankruptcy protection, announced Friday morning that it has filed a motion with bankruptcy court to start liquidating the company immediately.
“Hostess Brands will move promptly to lay off most of its 18,500-member workforce,” CEO Gregory F. Rayburn said in a statement, “and focus on selling its assets to the highest bidders.”
In a letter posted on a new website set up to communicate with employees and suppliers through the liquidation process, Rayburn pinned the blame on its striking union.
“Despite everyone’s considerable efforts to move Hostess out of its restructuring, when we began implementing the Company’s last, best and final offer, the Bakers Union chose to stage a crippling strike,” his statement read. “This affected Hostess’ ability to continue to make products and service its customers’ needs and pushed Hostess into a Wind Down scenario. As a result, we are forced to proceed with an orderly wind down and sale of our operations and assets. We deeply regret taking this action. But we simply cannot continue to operate without the ability to produce or deliver our products.”
About 75 to 80 of the plant’s 130 union members participated in a picket Thursday night, Lamont Phillips, president of the union’s Local 503, said then. As of Friday morning, they had not stopped. Phillips said Friday morning that he was waiting to hear word on the next move from high-ranking union officials.
Phillips said it is not fair to blame the plant shutdown on the striking employees.
According to a union press release issued when the strike began last week, the strike is due to cuts in wages and benefits.
“The contract calls for extreme wage and benefit cuts which amount to 27 percent to 32 percent overall, with an 8 percent wage reduction imposed immediately,” the statement read.
The statement said that workers have not been treated fairly.
“At the time of the first bankruptcy, Hostess workers were assured by management that money saved via concessions or plant closing would help make the company stronger, more vibrant, and more competitive,” the union statement read. “Instead, helpless Hostess employees watched as money that was supposed to go towards capital investment, product development, plant improvement and new equipment went to executive bonuses and payouts to hedge funds that own Hostess Brands. They watched as the company illegally withdrew from all Taft-Hartley pension plans, saving more than $50 million in the first five months.”
The statement goes on to say that the union learned that one executive was to be awarded a 300 percent raise, and at least nine other top executives were to receive raises ranging between 35 percent and 80 percent.
“Since the company ceased making contractually obligated payments to the Hostess workers’ pensions in July 2011, it has pocketed approximately $160 million – money earned by and owed to its dedicated workforce.”
Phillips, who had worked for the plant for 23 years, said it is unfair for the company to blame the striking workers for the plant shutdown.
“Its just (the company’s) way of them saying, ‘You are shutting us down,’ instead of taking blame for their own (actions),” he said.