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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Do you think that factory wages per hour during the strike would be higher, lower, or the same throughout the strike and negotiations as compared to earlier in the year? Explain.

Transcribed Image Text:m
Hust Born Quality Confections (Just Born) makes
marshmallow Peeps, Mike and
amales, and other candies. The company
has approximately 600 employee
s privately-held. Its headquarters and Peeps
factory are in Bethlehem, Pennsyivana. In September 2016, the factory employees
represented by the Bakery, Corfeconery, Tobacco Workers and Grain Millers
International Union of America al 6 went on strike and walked off the job.
Nearly 400 workers at Just Born are members of this union.
The union employees returned to work in early October after being on strike for
about a month. During the strike, the company did hire 56 replacement workers, so
not everyone was able to return to their old job after the strike. Also, during the
strike, some employees did cross the picket line to work, so Just Born had a mixture
of experienced and new employees in the factory during the strike.
Fall is Just Born's busiest time of the year. Production is being ramped up to meet
the demand for Peeps during the Easter season.
The negotiations have not been finalized and the possibility of a return to the strike
remains. The main sticking point is the company pension. Just Born wants new
employees to participate in a 401(k) plan rather than the company's pension plan.
Just Born has stated the current pension plan will stay the same for all current
employees, but the union disagrees. The other point of disagreement is the amount
of pay increases for employees.
hp
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