Behind Easter Peeps, an ugly dispute

BETHLEHEM, Pa. This morning, hundreds of millions of marshmallow chicks and bunnies called Peeps will peer out from Easter baskets at American children.

They are a pastel symbol of Easter joy, but behind the waxeyed candy is a company at war with its union workforce over rising pension costs — an escalating legal tangle that could soon upend the retirement plans of 10 million Americans.

The fight has featured a strike, Twinkies related bankruptcy, irreparably broken friendships, obscene T-shirts and a locked-up Peepsmobile. Now all sides await a federal appeals court ruling.

The 95-year-old company that makes Peeps, Just Born Quality Confections, wants to block new employees from enrolling in the multi-employer pension it has offered workers for decades, a retirement plan it funds along with roughly 200 other companies.

While many other companies facing similar pressures have left pensions in recent years, Just Born wants to bar new employees from the plan without paying a $60 million fee required under federal law, saying it must do so to remain competitive.

The fee exists to ensure future retirees’ benefits are covered, and if Just Born succeeds in escaping it, union officials fear the unprecedented ruling would prompt thousands of other firms to do the same. This chain reaction could divert workers and money at a time when new employees are seen as crucial to ensure ample funding for the wave of retiring baby boomers — putting payouts for millions of pensioners at risk.

It is a fight that has divided this