Hostess CEO cuts everyone's pay but his

Gregory Rayburn argues that because he isn't on the Hostess payroll, he should still get his full $125,000 a month.

By Kim Peterson Dec 4, 2012 3:50PM
Gregory 'Greg' Rayburn, CEO of Hostess Brands Inc., during a Bloomberg Television interview in New York on Nov. 16, 2012 (Scott Eells/Bloomberg via Getty Images)The CEO of Hostess Brands is getting widely criticized for taking his full salary while cutting everyone else's pay by 8%.

Gregory Rayburn will still get his $125,000 a month, or $1.5 million a year, the company told The Huffington Post. His logic is that because he isn't on the Hostess payroll, he doesn't have to take part in the company-wide pay cut.

Rayburn looks at himself as temporary, telling The New York Post he's more like outside help and therefore entitled to his full salary. He said he will leave Hostess when he's no longer needed, the Post reports.

Rayburn joined Hostess in February as chief restructuring officer, and one month later was named president and CEO. He's also on the board of directors.

To be fair, Rayburn is taking some measures to rein in his pay. He was eligible to get a bonus of between $375,000 and $1.125 million, but decided to give up the money, The Huffington Post reports. And Rayburn and three other top executives are taking $1 for the rest of the year in pay, but their full salaries will be reinstated in January.

That's small comfort to the rank-and-file employees who watched a number of Hostess executives get sweet pay raises and bonuses as the company barreled into bankruptcy. The company wants 19 top managers to stay with Hostess as it moves into the liquidation phase, and got approval from a bankruptcy judge to award up to $1.75 million in retainment bonuses.

The execs only get those bonuses if they perform specific tasks related to easing the operational wind-down, a company spokesman told The Los Angeles Times. Rayburn won't be getting a bonus.

At least 15,000 Hostess employees are losing their jobs in bankruptcy, but Hostess wants to keep about 3,200 to help wind down operations.

Hostess cracked under nearly $1 billion in debt, and blame for its demise can be spread far and wide. Private-equity firms funding the company couldn't get it off the ground. When consumers lost interest in carbs and sugar, the biggest innovation Hostess could come up with was banana-filling Twinkies. Although union members agreed to steep concessions over the years, it still failed to adjust to new realities. The old CEO, Brian Driscoll, suddenly bailed in March without explanation, Fortune reports.

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840Comments
Dec 4, 2012 5:42PM
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Greedy prick CEOs and executives they are killing American and the worst part is most Americans support and defend them. 125k a month when everyone else is loosing their job is a complete JOKE
Dec 4, 2012 5:40PM
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Any company that pays someone 124K in one month need to have their head examined.  I don't care if he's a reincarnation of Steve Jobs, Bill Gates, and Bezos combined.  NO ONE is worth that.
Dec 4, 2012 5:52PM
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This CEO thing is out of hand.... No CEO, especially one running a failing company should be paid like that.... Case in point JC Penney.
Dec 4, 2012 6:10PM
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perfect example of the top 2% in action
Dec 4, 2012 6:00PM
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What exactly has Rayburn done to improve the Hostess brand? ZIPPO! When former CEO Brian Driscoll suddenly left in March, it would be interesting to see what type of "Golden Parachute" he received. This corporate greed is nothing new. The philosophy is "Do as I say concerning jobs and wages, and don't be concerned about what I decide is BEST for me." Blaming the union after they took major concessions is ridiculous. Another sterling example of "The Blame Game." It's synonymous with today's corporate world. An elaborate corporate scheme to CMA! Unfortunately the terminated workers are getting nothing but lip service.
Dec 4, 2012 6:33PM
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This company is failing because of a history of over paying the under achieving executives.  Rayburn was hired to save the place and has beautifully proven he isn't capable of doing so.  Other than setting his own shorts on fire for the entertainment value, there is nothing he can do that is worth the pay he is receiving.  He needs to receive exactly the same pay the 18,000 employees his ineptitude has caused to be unemployed--nothing.

Dec 4, 2012 5:41PM
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What a jerk!!!! $125,000 a month, another example of Board of Directors taking care of their own! Someone please help Chase 2300!!!!
Dec 4, 2012 6:59PM
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wow 125,000 dollars a month ....ceos love to point the finger at employees kinda like congress its everyones fault but thiers !!!

Dec 4, 2012 5:12PM
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Would someone at MSN please ask Hostess when they will release our 401k from Principal and why hasn't it already been released . I have already received  my termination papers why hasn't  Principal been notified ?????
Dec 4, 2012 5:57PM
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Find out who is on the board of directors and write / call them and tell them to cut this guys pay. After they cut his pay tell this group of directors they need to now step down because they have not done their job. Thirdly, if you own their stock directly or within a Mutual Fund now sell it off.

 

Do the above with all companies that are paying these idiot CEO"s vast amount of monies and are not creating any new revenue company growth, screwing their employees and are not showing any future for the company.

Dec 4, 2012 6:06PM
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thats called temp work where i live and u dont get full pay of a full time employee

 

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That man needs to be fired, let go whatever. You can find plenty of intelligent, well educated, better people for the job who would work for ten percent of what he is paid and do a better job to boot.
Dec 4, 2012 6:14PM
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I hope Mr. Rayburn gets stuck in an elevator with a bunch of screaming flatulent kids.
Dec 4, 2012 5:53PM
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sleeps well at night i bet-he in actuality is small potatoes  just look at some of the other corps high paid ceo's then think about it ! when ytou work for someone else you are disposeable and they can find another like you!
Dec 4, 2012 6:37PM
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Do any of the rich people really know how to spend their money?  If they did they would be donating what they have to the ones they are abusing.  If they(the bosses') were to visit some of the people who lost their income, they might see what they are doing to families.  The USA is not going to have any families left if the money stays with the rich and never trickles down to the middle and lower people.  I've heard it is lonely at the top, I would not know since I've never been there.  i feel rich in so many ways without the money.  I have several friends and wonder just how many you rich people truly have without money!
Dec 4, 2012 6:06PM
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What is good for the goose, is good for the gander. Selfishness always shows it's colors sooner or later. What sacrifices does anyone make to another human when it comes to money ? How willing and at what cost ?
Dec 4, 2012 5:55PM
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look at the guy, and tell me he wasn't giving much of the money back by buying twinkies. Bet he was a box a day.
Dec 4, 2012 6:01PM
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what a P.O.S. I hope something bad happens to him.
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