New Owner of Hamburger Chain Should Minimize Job Losses and Guarantee Fair Notice and Severance to All Laid Off Employees
May 20, 2008
New York, NY- Brandworkers International has called on billionaire hedge fund investor and new owner of the Wendy's fast food chain, Nelson Peltz, to treat employees with respect and minimize job losses as his holding company carries out widely-anticipated layoffs. Brandworkers expressed disappointment with a letter recently sent to Wendy's employees by incoming CEO Roland Smith in which he not only issued a warning of job cuts but failed to offer assurances of minimum notice or adequate severance pay. Mr. Smith also suggested that existing employee benefits could be overhauled as soon as 2009.
"No lasting guarantee of benefits, promised job losses with no
mention of severance or notice, and CEO Smith instructs Wendy's
employees: 'don't get cynical'," said Natalie Zuckerman, a
Brandworkers campaigner. "Workers don't need the corporate buzz-words and home-spun stories about youth that Mr. Smith offered up in his letter, they need concrete assurances about their future. Mentioning there will be 'some type of a retention plan' yet to be determined does not suffice."
Nelson Peltz-controlled Triarc Companies, which recently entered a
definitive merger agreement with Wendy's International, had cited cutting
labor costs as a selling point in its push to win the deal. Private equity
groups and hedge funds such as Pelz's Trian Fund Management
LLP have shown an increased interest in retail and fast food companies
such as Burger King, Border's, and Home Depot. These lightly regulated investment vehicles typically promise more "lean" operating environments which often negatively impact workers. Last week, Peltz disclosed that his fund had purchased almost 900,000 shares of Starbucks stock.
"As more workers find themselves in retail and fast food jobs, companies in those sectors will come under increased scrutiny," said Dean Hubbard, a labor lawyer and public policy professor at Sarah Lawrence College. "Advocates will be watching closely as Triarc carries out its downsizing of Wendy's."
Brandworkers International is a non-profit organization protecting
and advancing the rights of retail and food employees. The group
connects employees with concerned citizens to win fairness on the job
and challenge corporate misconduct in the community. Wendy's workers
and family members can seek information about their rights through
the Brandworkers Legal Defense-Plus program by logging on to
http://www.Brandworkers.org .
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