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Home / Business / Peeps workers are still yelling – Portland Press Herald

Peeps workers are still yelling – Portland Press Herald

BETHLEHEM, Pa. – On April 1, hundreds of millions of marshmallow chicks and bunny peeps will stand out from Easter baskets among American children.

They are a pastel symbol of Easter joy, but behind the eyed-eyed Candy, a company is at war with its union employees over rising pension costs – an escalating lawsuit that could soon upend the pension plans of 10 million Americans.

The fight has a strike, twinkies bankruptcy, irreparably broken friendships, obscene t-shirts and a caged peepsmobile. Now all sides are waiting for a verdict from the Federal Appeals Tribunal.

95-year-old Peeps, Just Born Quality Confections, wants to prevent new workers from enrolling in the multi-employer pension that has been offered by several workers for decades. A Most other companies with similar pressures have their pensions in the leave last year. Just Born wants to eliminate new employees from the plan without having to pay US $ 60 million in US federal fees. This must be done to stay competitive.

The fee is intended to ensure that future pension benefits are covered, and if Just Born can escape, union representatives fear that the unprecedented decision would cause thousands of other companies to do the same. This chain reaction could divert workers and money at a time when new employees are considered crucial to ensure adequate funding for the wave of retired baby boomers ̵

1; disbursing millions of vulnerable retirees.

It's a fight that has divided this city coring company making a 28-calorie yellow spongy baby chicken against the union workers that deals with it. It has shattered the workforce of mechanics and confectionery manufacturers, who make 2 billion peeps each year.

The company has suggested that if these changes are not made, his future in Bethlehem could be in doubt.

"To stay sustainable We need to further reduce or reduce our costs to invest in our infrastructure, our employees and our brands," said Matt Pye, vice president of Just Born. "Our goal is to continue to produce cult brands for the next generations."

For many workers who make peeps, members of the bakery, pastry, tobacco and grain traders union, this line should not be exceeded

"There is a time when one has to take a position," said Alex Fattore, 55, who has worked for Just Born for 37 years and went out during the stunning strike of 2016 that escalated the feud. "You have to take a stand."

2016 VOTE

The stand came on September 7, 2016. It was supposed to be peak-peep-time when the company began production on an Osterbound, which was nearly half the annual turnover of the company.

Five days earlier, in a union building in nearby Allentown, 272 employees of Just Born met and voted against the company's latest contract proposal. This offer would have directed all new employees into a 401 (k) savings plan that did not provide benefits after retirement and discouraged them from participating in the pension.

The workers unanimously voted for the strike.

The following Wednesday, Fattore and more than 100 others went out of the sprawling candy factory that also makes the sweets Mike & Ike and Hot Tamales.

They marched up and down the sidewalk shouting "No Justice! No Peeps!" Again and again. The strike went around the clock.

Belt One, the marshmallow-moving sidewalk that produces most of the 5.5 million peeps per day, stood still.

Striking workers noticed the Peepmobile, a yellow VW Beetle adorned with a gigantic, similar chick's head, had disappeared from the front of the factory to be later locked in a cage where it could not be damaged.

Many in and around Bethlehem were stunned. Just Born and the union had co-existed since the 1970s without a strike. The company's revenue grew reportedly. In one area where steel workplaces had largely disappeared, candy jobs persisted.

Peeps are an iconic brand for Bethlehem and central to their identity. On New Year's Eve they will not drop a crystal ball. They drop a huge yellow peep. The volunteers of the trade unions work together in soup kitchens and local churches.

"It's not exactly like we're against it," said Thomas Hyclak, an economics professor at nearby Lehigh University. "It's not that management has tried to take jobs and move them to South Carolina, it's a good company, but the workers are also our friends and neighbors, it's hard for people to take sides." [19659002] The strike lasted several weeks. Candy production crashed, workers said, but the company refused to budge. The same family has heard Just Born for three generations, and they complained that staff costs were rising too fast. They had to curb these costs to keep the company competitive with others overseas.

"Many companies are relocating part or all of their operations outside the US to benefit from lower sugar prices outside the US and lower labor costs," Pye said in a statement to the Washington Post. "Just Born has been able to retain all of its production in the US so far, giving us a competitive disadvantage."

The union tried to keep its ranks, but people started to run away.

So the union agreed to end the strike after four weeks. The damage between the company and its workforce has been resolved. Many people who dealt with Band One would not look each other in the eye. It only got worse.

Union officials drew up a list of all those who had written the picket chain on their bulletin board with the word "scab," a workbench for someone who breaks solidarity. It was demolished less than two hours later.


The Calvin image remains on the window of a union member's lorry, a daily reminder that the animus is still staggering from the strike – and that the problems that originally drove it , remained unsolved.

The pension, which is administered by a group of labor officials and executives from the 200 participating companies, has sued the company, claiming it has improperly attempted to hire new employees to pay the pension without the payout fee. The company has sued the union demanding "monetary damages" and claims the strike is illegal.

Businesses, union leaders and retirees are watching closely, because the multi-employer pension that Peeps employees depend on is nearly 1,300 [19659002] in total, according to Pension Benefit Guaranty Corp. 10 million active and retired workers participate in various employer pensions. These pensions allow workers to move from one job to another within the same pension and receive their retirement pension with them.

Many of these pensions for multiple employers are on their way to running out of money. If the pension is out of money, retirees may get only a small percentage of the money they've earned over decades of work.

To make matters worse, when one of the companies that contribute to the multi-employer plan goes into disarray, the other companies hang in order to pay more to stabilize the fund.

Just Born's union employees participate in the Bakery and Confectionery Union and Industrial International Pension Fund, which was filled with cash several years ago even after the cash cash payment crisis. At one point it had so much money that it paid retirees 13 monthly checks every year.

The company and the boarding house seemed healthy, but when the catastrophe came, it seemed far beyond their control.

Hostess Brands, manufacturer of Twinkies and Ding Dongs accounted for 24 percent of all contributions to the multi-employer annuity. In 2011, the company stopped contributing and in 2012 began bankruptcy, which was impacted by weaker demand, fiercer competition and high levels of debt. Federal courts allowed it to escape without paying the fund $ 1 billion in commitments.

The Pension Fund immediately became one of the most endangered in the country from one of the healthiest in the country.

The boarding house was now in a category known as the "red zone", which means that if changes are not made, it will probably go bankrupt and beneficiaries could only get pennies on the dollar when they move into Retire. Some other pensions are even in worse shape.

"The crisis is looming," said Kenneth Feinberg, who worked at the Ministry of Finance until last year and was tasked with examining rescue proposals from plans by several employers [196592002] In February, Congress created a commission as part of a new budget law. to try to stabilize the pension funds. In the meantime, many existing companies like Just Born are on the hook to pay higher premiums. The Peeps-making Company says, without any hard numbers, that it pays 39 percent more pension contributions than what it negotiated under its last union contract.

These are the posts that she tried to reverse when she had unilaterally attempted to redirect new employees into a 401 (k) plan. A federal judge said last year that the company could not do this, but it appealed to that decision. The company and its union, like many other companies, await the decision of the Appeals Tribunal.


"We would like to say that Just Born is the cutest place in our community." Ross Born, co-executive director of the firm and grandson of his founder, said in a 2016 year Review "Video. "We use more sweeteners than anywhere else and we have the cutest people who really care about our brands."

The sugar-sweet praise concealed how strained relations had become with Just Born's union staff. The board had already sued Just Born, and now the company, the boarding house and the union are involved in legal proceedings. All pages are frozen as a federal appeals court decides whether Just Born can ban new employees from the pension while avoiding the $ 60 million fee.

"You've got rid of the fund in a circular fashion that I do not think anyone has ever done," said Judge of the US District Court, James Wynn Just Born's lawyer in January, without saying if he would allow it.

Since the strike, the company and its workforce are under contract. The union says there are only 326 workers in the production floor in Just Born, 400 of them at the time of the strike. And only 250 are in the union.

Just Born's Pye said the firm has no plans to sell itself or move abroad. The company is just trying to manage the costs of the future. Union officials said they believe the company and its workforce have changed forever.

"Will all things be the same as before?" Said Hank McKay, president of the union chapter "Local 6," to which the Bethlehem workforce belongs. "I do not think so."

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