You'll recall that Hall was floored last week when he learned that Hostess executives gave themselves huge raises in the run-up to bankruptcy. He had a few choice words for the Twinkie-maker:
According to the Teamsters press release, Hall said it appeared that,
"...management broke the law, looted the company and then told workers to suck it up and sacrifice."And this:
“If this is true, Hostess executives have violated their agreement with the Teamsters that all parties, including management, would share equally in concessions that would help keep this company alive,” Hall said.
“It would be outrageous for the board of directors, which included secured lenders, to approve executive salary increases of up to 300 percent for a company that has filed for bankruptcy twice in four years."Hostess executives quickly backpedaled. The Houston Chronicle reported they now have less filling in their paychecks:
Gregory Rayburn, a restructuring expert who took over as chief executive last month, said the top four Hostess executives reporting to him agreed to cut their annual salaries to $1 until the company either emerges from bankruptcy or Dec. 31, the Wall Street Journal reported. Four other executives agreed to return pay increases they received last July, six months before the company’s January bankruptcy filing.
The committee of unsecured creditors claimed the company switched executive pay from performance-based bonuses to salary, a move that appeared to skirt legal limits on retention pay for executives at bankrupt companies.
News of the pay increased angered unions representing Hostess workers, who have been asked to accept a pay freeze as part of the reorganization.
