Hundreds of workers at Giant Food distribution center in Jessup worry that their jobs are in danger because a New Hampshire company will take over operations of the facility next month.
The company, C&S Wholesale Grocers, laid off 1,100 workers at a subsidiary in New Jersey earlier this month when it shut down six food distribution centers. Unionized Giant workers fear they could face the same fate just as their contract is slated to expire May 14.
About 600 of the workers and union organizers gathered at a Teamsters union hall Sunday to discuss how to fend off possible job losses that could impact more than 1,000 workers.
An executive with C&S contacted by phone later in the day said any decision about the plant will be made during contract negotiations.
"It's best not to negotiate in the papers before we even have operations of the plant," said Bruce Johnson, C&S executive vice president of human resources. "We have a very high degree of respect for collective bargaining."
He said the union's belief that C&S would shut the facility down was "strictly speculative."
Giant, the region's largest grocer, signed an agreement last year with C&S to have the company run the dry-goods side of the facility as a cost-savings measure. It decided to keep control of the produce side of the plant, at the time saying it could focus on and possibly expand that part of the business.
But union leaders say Giant is trying to pressure workers to agree to concessions by next month, warning them that it will turn over the produce side of the business to C&S if they do not. Union officials said Giant has told them it could save $29 million by outsourcing.
Giant spokesman Brian Beatty said in an e-mail that the company is prepared to offer the three unions at the plant a fair contract proposal. He did not rule out outsourcing.
"Giant is exploring all of its options regarding the fresh warehouse and transportation businesses," Beatty said. "Giant continuously looks at all aspects of the business to determine how to beset provide maximum value to our customers."
The deadline Giant is giving the union to agree to the concessions, March 20, is just before the C&S takes over the dry goods side of the distribution facility, union officials said. It would also give Giant time to give the union the 60 days' notice for layoffs as required by the labor contract, the union said.
Giant is bargaining early at the request of the union, Beatty said.
The union believes when C&S takes over the company, it will push for deep concessions — and shut down the plant and move work to a facility in Pennsylvania if they aren't met. That facility uses robotic technology and needs fewer workers.
The Jessup facility employees about 430 people in dry goods and 380 in produce as well as other workers, including 200 truck drivers, according to union officials.
"Giant is going to have C&S come in and do their dirty work," said Ritchie Brooks, president of Local 730, one of three unions with workers at the plant.
Jeremy Diamond, a local grocery analyst, said he wouldn't surprised if C&S shut down the Jessup facility rather than have to battle the union. Grocers are also looking for ways to save money because of competition.
"C&S has so many distribution centers that if they're getting bullied around by the union, it won't be worth it for them to stay," Diamond said.
Concern about the plant has been enough to get the attention of Gov. Martin O'Malley's office.
J. Ronald DeJulius, commissioner of labor and industry for the Maryland Department of Labor, License and Regulation, told union members he plans to meet with representatives from the county executive offices in Howard and Prince George's counties to discuss the issue.
"We are looking to see if there is anything the governor can do to help mediate and hopefully save some jobs," DeJulius said after the meeting.
Workers are beginning organizing efforts to try to thwart layoffs, including preliminary planning to picket if negotiations reach that point.
Workers at Sunday's meeting, many who have been with Giant for years, said the grocer is unfairly targeting them as it faces more pressure to cut costs as competition in the grocery market has become more fierce and the company has lost market share.
Terry Rider, 50, who works in the fresh-food division, has gone through many contract negotiations in his 23 years working at Giant. He said this is the most worried he has ever been for people's jobs. C&S has cut jobs before in other regions and their Pennsylvania plant has room for more capacity, he said.
"They're using labor as an excuse to cut the budget," Rider said. "The worker is expendable."
When C&S shut down the six plants in New Jersey earlier this month, it said in a news release it cost $46 million more to do business at the plant than moving the operations to other regional facilities. The company said the local union also would not agree to certain concessions.
Bernie Fields, who has worked at the Jessup plant for 31 years, said workers are more concerned than ever about jobs, particularly as more distributors use technology and robots.
"He doesn't want a vacation," Fields said about the robots. "He doesn't ask to take off and he doesn't need a bathroom break."