The little menhaden is creating quite a ripple. An Atlantic coast fisheries commission is expected by week’s end to set a coast wide catch limit for Atlantic menhaden for the first time in history, despite the lobbying efforts of Omega Protein, the huge Houston-based harvester of the fish.
The Atlantic States Marine Fisheries Commission (ASMFC), representing 15 states from Maine to Florida, is acting because the menhaden population is at its lowest point on record. The silvery fish is a prime source of protein for larger marine predators, including striped bass and humpback whales.
The anticipated limit has the full attention of Omega Protein, a manufacturer of fishmeal and oils taken from menhaden found along the Atlantic Coast and in the Gulf of Mexico.
Numbers of menhaden have declined 90 percent from historic levels, leading the fisheries commission to step in to end overfishing of the species. The ASMFC will make a final decision about a catch limit on Friday in Baltimore.
This is not a new fight for Omega Protein. The manufacturer has been lobbying against regulations that would affect its menhaden harvest for almost as long as it has been scooping fish out of the sea. For years, Omega has claimed that scaling back the menhaden harvest would hemorrhage jobs at its factory in Reedville, Va.
Omega’s public relations outreach during the run-up to Friday’s fisheries commission vote has been all about potential job losses. Omega Protein spokesman Ben Landry told the Daily Press that drastic reductions to Omega’s catch would “decimate the employment at Omega Protein.” The company, he said, supports only a “modest, measured” 10 percent cut in harvest based on a three-year average of menhaden landed at the Virginia factory. The Commission is weighing reductions in catch up to 50 percent.
The company, using eight boats, harvests nearly half a billion pounds of menhaden annually, and then reduces the catch into fish meal for aquaculture and fish oil pills for human consumption. Omega plant manager Monty Deihl wrote last month in the Roanoke Times that “Omega Protein directly provides 250 jobs, and indirectly provides hundreds more. Its annual economic contribution is $88 million in a region where dependable, good-paying jobs are scarce.”
However, a closer examination of Omega Protein’s record on labor and worker safety tells an entirely different story about the company’s commitment to American jobs.
Records obtained through a Freedom of Information Act request reveal that Omega Protein has employed hundreds of foreign laborers through H2B visas, a federal program that allows American companies to hire foreign nationals to fill temporary jobs. In order to be awarded H2B visas, a company must prove that “there are not enough U.S. workers who are able, willing, qualified, and available to do temporary work.”
In 2006 and 2007, according to U.S. Department of Homeland Security documents, Omega Protein received visas for 695 foreign workers to fill positions at its factories and its fishing boats in Louisiana, Mississippi, and Virginia.
Although the vast majority of the workers permitted to Omega Protein under H2B visas toiled at the company’s Mississippi and Louisiana locations, Omega’s Virginia plant received visas for 46 foreign workers in 2006 and 2007. They included 17 fishermen to “fish for menhaden fish on purse boats,” and 29 laborers to “perform manual labor in fish processing plant yard.”
During 2006-2007, when the foreign workers were laboring at Omega Protein’s Reedville plant, joblessness in Reedville and the surrounding counties was at 4.2 percent — 1.2 percent higher than the Virginia state average.
Unemployment in Louisiana was 3.7 percent in 2006 and 2007, while Mississippi joblessness topped 6.5 percent. Omega Protein’s plants in those two states received a combined 596 foreign workers through the company’s application to the H2B visa program.
“We haven’t used H2B visa employees in Reedville in six or seven years,” said Ben Landry, public affairs director for Omega Protein. “We typically use them in the Gulf because the workforce in the Gulf is so overwhelmingly influenced by the oil and gas industry. The average laborer, a young man, blue collar worker, can make an extraordinary rate in the oil and gas industry and it was something we weren’t able to keep up with.”
Omega Protein did not utilize H2B visa workers from 2008 through 2010, “due to the very small number of employees available under the program’s lottery system,” according to the company’s SEC filings. But more recent filings reflect that Omega Protein employed H2B visa workers in 2011, and applied for foreign workers again in 2012.
Reports filed under the Lobbying Disclosure Act indicate that Omega Protein spent $770,000 lobbying Congress in 2008; one of their disclosed Capitol Hill activities was advocating to expand the H2B visa program.
The national H2B visa program is contentious, in part because it has occasionally been exploited to save money for firms using the foreign workers. In Oregon, four logging outfits used $7 million in stimulus money to hire 250 foreign workers in early 2012. A 2010 Government Accountability Office (GAO) Report found massive fraud in the H2B visa program, including excessive fees from employees, unfair wages to workers and false documentation provided to government agencies.
Omega Protein has never been cited for any H2B violations. However, information disclosed on H2B visa applications indicates that Omega Protein pays its foreign workers less than their American counterparts.
At a public hearing on menhaden in Chesapeake Beach this fall, Ken Pinkard, a cook at Omega Protein’s Reedville operation testified that he earns 45 cents per thousand fish caught by the vessel on which he works. He said that he makes up to $35,000 per season. Pinkard is a vice president of United Food and Commercial Workers Union (UFCW) Local 400, which represents Omega Protein’s Virginia workers.
According to H2B visa documents obtained by the Public Trust Project, Omega Protein paid foreign fishermen based in Reedville $8.26 per hour for full time labor for 37 weeks in 2006 – adding up to just over $12,000.
Omega spokesman Ben Landry says that despite what was disclosed on the federal forms, foreign workers in Virginia and the Gulf of Mexico are paid the same way American workers are – by the number of fish caught. “It’s a negotiated rate per thousand fish,” he said.
UFCW Local 400 has urged its members to support Omega Protein by telling the Atlantic States Marine Fisheries Commission not to hurt working families by cutting the harvest of menhaden.
In a phone interview, Ken Pinkard said the union was concerned about the impending regulation because members’ salaries are tied to fish catch. “If they say we’re going to cut the harvest 10 percent, I will make 10 percent less next year than I made this year. It has a direct impact on the workers,” he told me.
Pinkard said that the union contract protects workers in Reedville. “It’s fine if they bring someone from Mexico,” Pinkard said. “We’ll sign them up for the union.” But in Reedville, he said, “there’s always more fishermen than Omega can hire.”
Omega Protein’s hiring is largely seasonal and temporary. Court records from Scott v. Omega Protein, heard in a Louisiana appeals court in 2008, confirm that workers at the Gulf plant are fired when the fishing season is over. “At the end of each season, fishermen are ‘cut out’ and may collect unemployment benefits or seek employment elsewhere. A fisherman may then reapply for a position with Omega Protein for the next season,” the record states.
This practice is not limited to the Gulf of Mexico. In March, I interviewed five fishermen from Omega Protein’s Reedville, Va. plant, who had been bused to Washington DC by their employer to attend the Keep Fishermen Fishing rally. The fishermen said that they work aboard Omega Protein’s ships from May through December, and collect unemployment benefits during the offseason. “The vast majority of [Omega’s] workers will draw unemployment in the offseason,” Pinkard said.
Weekly unemployment benefits in Virginia range from $54 to $378 for a single person, depending on how much he or she has earned during previous employment.
Omega Protein also has a spotty record on worker safety.
In April 2012, 24-year-old Christopher Herbert bled to death after getting stuck in a rotating screw conveyer at Omega Protein’s Moss Point, Mississippi plant. Herbert had been employed at the plant for three years. Omega Protein released very little information about the incident, despite Herbert’s family’s plea for facts about his ghastly death.
A subsequent investigation by the Occupational Safety and Health Administration (OSHA) revealed that Herbert’s death was the fault of the company. OSHA cited Omega Protein 21 “serious violations,” including a lack of guarding on the conveyer belts, failure to properly secure compressed gas containers, and failure to provide training for forklift operators, among others.
OSHA classifies violations as serious when “there is substantial probability that death or serious physical harm could result from a hazard about which the employer knew or should have known.” OSHA proposed a $79,200 fine, and settled with Omega Protein for $50,000.
“This terrible incident could have been avoided if the employer had followed OSHA’s standards for energy control procedures,” said Clyde Payne, OSHA’s area director in Jackson, in a news release.
Since 2002, OSHA has cited Omega Protein with 63 violations, including 41 at the Reedville plant, with total penalties of $67,769. Last year, three Omega Protein fishermen perished after their ship collided with a container ship in the Gulf.
For all of Omega Protein’s protestations about job creation in Virginia, the history of the menhaden fishing industry has been one of contraction and workforce elimination. In 1876 there were 99 menhaden reduction factories up and down the East Coast. During World War I, there were 18 reduction factories in Reedville alone.
In the late 1990s, when the Atlantic States Marine Fisheries Commission (ASMFC) first began debating how to deal with the menhaden decline, there were three factories left. In 1997, Zapata Protein (soon to become Omega Protein) bought its main competitor, Ampro Fisheries, for $14.5 million dollars in cash, reducing the number of plants in Reedville to one. Zapata fired all 160 workers at the Ampro plant.
A 1997 story in the Richmond Times-Dispatch reported that Zapata intended to rehire many former Ampro employees but would be offering them positions in the Gulf. “That means scores of displaced low and middle-income fish factory workers and crewmen among the predominantly black workforce are considering whether they’d move if given the chance,” the Times-Dispatch said.
Don Cash, executive assistant to the president of the United Food and Commercial Workers Union Local 400 said at the time that he believed at least 30 to 40 former Ampro workers would be without jobs once the fishing season began again.
While workers like Ken Pinkard earn less than half a penny per menhaden caught, top Omega executives took in $15 million in salaries over the last two years, and $900,000 in bonuses in 2012. The company has recorded its highest revenues ever during the third quarter of 2012 — nearly $78 million.
Weighing the consequences of cutting the menhaden harvest against the jobs at stake is a tough call in the short-run. But over the long haul, maintaining a healthy stock makes sense for the sustainability of the ecosystem – and the fishermen.
Bill Goldsborough, senior scientist at the Chesapeake Bay Foundation and a member of the fisheries commission, says industry jobs are based on “publically owned biological resources” – that is, fish in the ocean.
“The ASMFC has the responsibility to maintain these resources for the public benefit,” he says. “Conserving menhaden will restore jobs, not destroy them, and benefit the ecosystem and the economy.”