(Image Source: ABC News)

 

BY DAN KENNEDY

ANCHOR LAUREN GORES


It may not be time to hoard those Twinkies and Ding Dongs just yet.
Talks are set for Tuesday afternoon between Hostess executives and a key union in the strike.
But in the meantime, the company is seeking permission from a bankruptcy judge to pay bonuses to key managers.

The Washington Post says Hostess “wants to pay as much as $1.75 million in incentive bonuses to 19 senior managers during the liquidation.”

But U.S. Trustee Tracy Hope Davis doesn’t like that plan.
She says because Hostess wants to pay those bonuses, the case should change from Chapter 7 to Chapter 11 Bankruptcy.
And she’s asking the judge to appoint a trustee to supervise negotiations in the closing weeks.

A Forbes article says “Hostess Brands’ management gave themselves several raises, all the while complaining that the workers who actually produced the products that made the firm what money it did earn were grossly overpaid relative to the company’s increasingly dismal financial position.”

The unions say Hostess could’ve avoided the layoffs by paying its executives less money.
Here’s CNBC.

“The CEO and 9 other executives did get a big raise months ago when they were going into this. That’s the kind of thing that ticks people off in America.”

Gawker reports the former CEO of Hostess was awarded a 300 percent raise just months after originally declaring bankruptcy.
At least nine other executives received big bonuses too.

A Salon article traces the trail of the troubled company and its financial woes.
Hostess first filed for bankruptcy in 2004 but a private equity company brought the twinkie-maker out of bankruptcy in 2009.

It says, “thanks to debt approaching $1 billion, Hostess ended 2011 with a loss of $341 million. The CEO who led the company back into bankruptcy? He got a pay raise -- while Hostess pushed a 30 percent salary and benefit cut onto its employees.

This isn’t the first time a company has compensated its execs during bankruptcy or financial instability, ThinkProgress points to MF Global, Citigroup and Caterpillar as other instances.

And the Huffington Post says CEO pay has grown 127 times faster than worker pay over the last 30 years.

Is Hostess' Exec Pay the Problem?

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Transcript
Nov 20, 2012

Is Hostess' Exec Pay the Problem?

(Image Source: ABC News)

 

BY DAN KENNEDY

ANCHOR LAUREN GORES


It may not be time to hoard those Twinkies and Ding Dongs just yet.
Talks are set for Tuesday afternoon between Hostess executives and a key union in the strike.
But in the meantime, the company is seeking permission from a bankruptcy judge to pay bonuses to key managers.

The Washington Post says Hostess “wants to pay as much as $1.75 million in incentive bonuses to 19 senior managers during the liquidation.”

But U.S. Trustee Tracy Hope Davis doesn’t like that plan.
She says because Hostess wants to pay those bonuses, the case should change from Chapter 7 to Chapter 11 Bankruptcy.
And she’s asking the judge to appoint a trustee to supervise negotiations in the closing weeks.

A Forbes article says “Hostess Brands’ management gave themselves several raises, all the while complaining that the workers who actually produced the products that made the firm what money it did earn were grossly overpaid relative to the company’s increasingly dismal financial position.”

The unions say Hostess could’ve avoided the layoffs by paying its executives less money.
Here’s CNBC.

“The CEO and 9 other executives did get a big raise months ago when they were going into this. That’s the kind of thing that ticks people off in America.”

Gawker reports the former CEO of Hostess was awarded a 300 percent raise just months after originally declaring bankruptcy.
At least nine other executives received big bonuses too.

A Salon article traces the trail of the troubled company and its financial woes.
Hostess first filed for bankruptcy in 2004 but a private equity company brought the twinkie-maker out of bankruptcy in 2009.

It says, “thanks to debt approaching $1 billion, Hostess ended 2011 with a loss of $341 million. The CEO who led the company back into bankruptcy? He got a pay raise -- while Hostess pushed a 30 percent salary and benefit cut onto its employees.

This isn’t the first time a company has compensated its execs during bankruptcy or financial instability, ThinkProgress points to MF Global, Citigroup and Caterpillar as other instances.

And the Huffington Post says CEO pay has grown 127 times faster than worker pay over the last 30 years.
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