Allen Family Foods will fight $1M penalty 

Posted: 8:18 pm Mon, June 7, 2010
By Ben Mook
Daily Record Asst. Business Editor

As it prepares to fight the largest single occupational safety fine in state history, Allen Family Foods Inc. is selling the Eastern Shore plant in question to a South Carolina poultry processor.

Amick Farms LLC, based in Batesburg-Leesville, S.C., will buy the Hurlock processing plant as well as a hatchery and a feed mill in Delmar, Del. The sale price was not released.

The citations, announced Friday, assessed a $1.03 million fine for 51 violations against Allen Family Foods, a 91-year old, family-owned poultry processor based in Harbeson, Del. Department of Labor, Licensing and Regulation Secretary Alexander M. Sanchez called the penalty “unprecedented” and said the company had been a “source of repeated health and safety violations over a number of years.”

“Allen’s intends to contest the MOSH [Maryland Occupational Safety and Health] citation for our Hurlock, Md. facility,” Tracy Morris, the company’s vice president of human resources, said in a prepared statement. “We have a good, professionally administered safety program, including inspections twice a year by an independent safety expert, which are monitored by MOSH’s consultation unit.

“The citation in this case is not an accurate reflection of our safety record.  Rather, we think it is the result of MOSH’s adoption of a more aggressive enforcement policy.”

On Friday, MOSH issued the citations against Allen Family Foods. The investigation began on Dec. 10, 2009 after an employee at the Hurlock plant was seriously injured reaching under an unguarded conveyor belt. There were four citations, alleging 51 violations of occupational safety and health laws at the plant, which processes chickens for de-boned breasts, chicken parts and leg quarters.

The company’s two locations on the Eastern Shore have been inspected 16 times since 1998, according to MOSH. Seven of those inspections were for accidents and 192 violations were issued as a result.

Allen Family Foods is the largest employer in Dorchester County. In 2009, the poultry company employed 1,048 people, according to the Department of Business and Economic Development. Allen Family Foods said the Hurlock plant has contracts with 100 poultry growers on the Shore.

Amick Farms LLC is a portfolio company of OSI Industries LLC of Aurora, Ill. Amick produces about 468 million pounds of poultry per year, according to its website, while Allen reports that it produces about 600 million pounds a year.

The sale of the Hurlock facility, revealed the day before the $1.03 million fine was announced, is expected to be completed by the end of June. The MOSH fine would not carry over to the new owner.

In announcing the sale, Amick said that it would retain all of the employees and growers associated with the Hurlock operation. Amick officials were not available for comment Monday.

Allen Family Foods said the sale is a continuation of the company’s effort to consolidate processing at two other plants, one in Harbeson and another in Cordova, Md. The Cordova plant is Talbot County’s second largest employer with 550 workers. .

The Maryland fine comes after a penalty was levied against Allen Family Foods at its Harbeson facility in March. Alerted by MOSH about its Maryland investigation, the U.S. Department of Labor’s Occupational Safety and Health Administration cited Allen for 45 “serious” violations and proposed a $182,000 penalty.

Violations included hazards with industrial trucks, and deficiencies in machine guarding and personal protective equipment.

Domenick Salvatore, director of OSHA’s Wilmington, Del., office, said the agency has been working with the company to address the violations. Salvatore said the company paid a reduced penalty of $127,540 and has settled all but a few of the issues raised.

“The case has been settled,” Salvatore said. “They were issued a penalty of $182,000 and they received a 30 percent reduction for their abatement efforts.”