Hostess Execs Want $1.8 Million In Bonuses, ‘Can’t Afford’ To Pay Retirement Benefits

Commentary | Hostess executives — who in part were responsible for the pervasive anti-union narrative that emerged after the snack peddler decided to cash out when employees balked at yet another series of pay and benefit cuts — are now planning to ask a bankruptcy judge to approve $1.8 million dollars in bonuses for them to stick around and close up shop for the dying brand.

The Hostess executive’s bold request comes as the company claims it cannot afford to pay employees their earned retirement benefits of cut $1.1 million a month.

The Huffington Post indicates that while Hostess workers — who labored in the brand’s plants baking and shipping the company’s goods for years — may be denied the benefits to which they were entitled as part of their contracts, executives feel the multi-million dollar payouts are justified even while stiffing the working stiffs.

The site explains that without the “incentive pay” sought by Hostess execs, they may not feel like sticking around to nail the brand’s coffin shut, leaving more than 18,000 workers without jobs. And depending on how good they are at failing, the Hostess execs might even “earn” more in bonuses as they welsh on paying out former employees’ packages:

“The maker of Twinkies, Ding Dongs and Ho Hos says the incentive pay is needed to retain the 19 corporate officers and “high-level managers” during the liquidation process, which could take about a year. Two of those executives would be eligible for additional rewards depending on how efficiently they carry out the liquidation. The bonuses would be in addition to their regular pay.”

HuffPo adds:

“The bonuses do not include pay for CEO Gregory Rayburn, who was brought on as a restructuring expert earlier this year. Rayburn is being paid $125,000 a month.”

Bloomberg Businessweek reports that former Hostess employees will have a chance to fight the executives for the benefits they’ve worked for — but a brief return to the bargaining table before the shutdown ended nearly as quickly as it began, perhaps signaling that there is scant hope the workers will ever see the benefits for which they toiled for years.

“U.S. Bankruptcy Judge Robert Drain in White Plains, New York, today approved formation of a committee of retired employees to defend their rights in connection with the intended cuts. Drain is also being asked to consider Hostess’s request to close and its bid to pay as much as $1.75 million in incentive bonuses to 19 senior managers during the company’s wind-down.”

Do you think it’s fair for Hostess executives to cry poverty when it comes to paying employees benefits they earned as they pocket the company’s remaining dough?