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For the second time in a week, a government unemployment report is sowing confusion—and may not be as positive as the market thinks, CNBC reported yesterday. The Labor Department on Thursday said that the number of people filing jobless claims last week dropped by a seasonally adjusted 30,000. While the government didn’t note any unusual factors in the release itself, a Labor Department official told news agencies about a quirk that partly accounted for the larger-than-expected drop. The wording of that statement, along with the accompanying news headlines, left the impression that one major state didn’t turn in its figures. It is unclear why that happened or how unusual that is, but what is clear is that the expected spike in claims around the start of each quarter was smaller this time than usual. In other words, the drop of 30,000 last week had more to do with the lack of expected refilings at the start of the fourth quarter than with any particular improvement in labor market conditions. And now, there is one state’s labor department with some explaining to do.

Hostess Brands Inc. filed a reorganization plan that includes wage cuts, reduction in health care and welfare benefits, and a freeze on pensions for at least two years, Reuters reported yesterday. Hostess is seeking to eliminate unsecured claims worth about $2.5 billion under the plan, and its equity owners may end up losing their investments, the company said in a court filing. Hostess filed for chapter 11 protection in January for the second time in less than three years as it struggled with crippling costs associated with its pension plans. Union and nonunion employees will take an 8 percent wage cut and will see only modest hikes in the coming years. The case is In re Hostess Brands Inc., Case No. 12-22052, U.S. Bankruptcy Court, Southern District of New York.

Eastman Kodak Co. said Wednesday that it has asked a bankruptcy court judge to allow it to end retiree medical and some other benefits at the end of the year as part of its restructuring, The Associated Press reported yesterday. The company said it reached an agreement with the court-appointed committee of retirees to pay a total of $650 million in claims and $7.5 million in cash into a fund that could be used for future payments in exchange for eliminating its current $1.2 billion liability for medical, dental, life insurance and survivor income benefits. A company spokesman said pensions would not be affected, adding that the other benefits cost about $10 million monthly and the change is essential to emerging successfully from chapter 11 protection. A hearing on the agreement has been scheduled for Oct. 29.

Bankruptcy Judge Sean Lane yesterday declined to rule on a pilots' appeal to preserve their old labor agreement, meaning the airline can continue making work changes while the two sides continue contract talks, Reuters reported. Judge Lane ruled last month that the airline, the operating unit of AMR Corp, could reject the previous labor agreement, which had been under negotiation since 2006. The union appealed the decision and it has asked the court to stop the airline from making changes while the appeal is pending, arguing that the changes cause "irreparable harm" to members. Judge Lane did not set a date for a ruling on the issue.

The Labor Department has rejected aid packages for Abound Solar Inc. workers at the Colorado company in four locations, the Washington Times. Notices for three of the determinations were published late last week in the Federal Register. In each case, the Labor Department decided against doling out special government aid for workers who were displaced by foreign competition. While officials previously certified assistance packages for Solyndra workers, the Labor Department said that imports of products competing with Abound's products had not increased enough to make workers eligible for the aid. Though both were solar-panel makers, Abound and Solyndra made different products, even as their bankruptcies linked them in political headlines.

Pinnacle Airlines Corp.'s thousands of pilots and flight attendants are objecting to the airline's bid to scrap their contracts, a move the regional carrier says is necessary to exit bankruptcy protection, Dow Jones Daily Bankruptcy Review reported yesterday. The union representing some 1,800 flight attendants said in a court filing Friday night that Pinnacle has shown no compelling need to cut "by even one penny," its flight-attendant compensation. The Association of Flight Attendants said in a court filing that Pinnacle's flight attendants, far from being overpaid, are "actually below market in their wages, benefits and work rules." Pinnacle's 2,800 pilots, represented by the Air Line Pilots Association, is also protesting the carrier's bid to void their contract. The pilots' objection, unlike their flight attendant colleagues', was filed under seal.

The bankrupt maker of the Twinkies snack cake, Hostess Brands Inc., received court permission yesterday to impose a pay-cutting collective bargaining agreement on thousands of workers in a bakery union, Reuters reported yesterday. The company had argued that imposing the agreement, which will cut wages by 8 percent and reduce benefits, was the only way for Hostess to avoid liquidating its assets and going out of business. After the 6,500 members of the Bakery, Confectionary, Tobacco and Grain Millers International Union rejected the pay contract by a wide margin, Hostess asked Judge Robert Drain to impose it as a way of saving the company. Hostess has now secured cost-cutting deals with steelworkers and its biggest union, the International Brotherhood of Teamsters, which represents 7,000 of the company's 18,000 employees.

AMR Corp.'s American Airlines lost a bid to stop a union-representation election for a group of employees as a federal appeals court threw out the carrier's lawsuit challenging the vote, Bloomberg News reported yesterday. The decision yesterday by the U.S. Court of Appeals in New Orleans means the union vote among approximately 10,000 passenger-service employees at the airline can proceed, the Communications Workers of America said. The CWA is seeking to represent the workers. The appeals court's decision is a setback for American, which is seeking to cut labor costs as part of its bankruptcy restructuring. The Fort Worth, Texas-based airline has negotiated cost-cutting deals with flight attendants, mechanics and other workers, and has won court approval to reject its labor contract with pilots. American sued the National Mediation Board in May to stop the union election by passenger service employees. U.S. District Judge Terry Means blocked the vote, and said that the board exceeded its authority when it authorized an election. The appeals court said in its decision that Means "erred in exercising jurisdiction." Judicial review of National Mediation Board decisions is appropriate only when the agency has committed egregious error, the court said.

American Airlines says that if pilots do not end actions that are disrupting its flights, it will take their union to court, the Associated Press reported yesterday. A top American Airlines executive told union leaders that some pilots were conducting "an unlawful, concerted effort to damage the company" by filing more maintenance complaints and other tactics, leading to a surge in late and canceled flights. Denise Lynn, the company's senior vice president of people, asked union officials to denounce any "work actions." She said that the pilots' actions alienated passengers and threatened the company's financial prospects just as American parent AMR Corp. is trying to turn itself around after a decade of huge losses.

Completing its negotiations with the three Detroit automakers, the Canadian Auto Workers Union said yesterday that it had a tentative agreement with Chrysler Canada, the New York Times reported today. Chrysler appeared to have been the most difficult of the automakers during the negotiations which began at all three companies in mid-August. During the talks, Sergio Marchionne, Chrysler’s chief executive, suggested to that the company would not follow industry tradition and accept the same general contract terms as the Canadian units of Ford and General Motors. The union, however, made it clear that any agreement hinged on maintaining that process, which is known as pattern bargaining.