EB-5 Risk Alert: Labor Unrest at American Logistics Possible

Several of you have asked us why we are focusing on American Logistics International Regional Center and we want to take the opportunity to answer this question.

A few months ago, American Logistics employees reached out to us to discuss their concerns about the company’s operations. As we’ve learned more, we’ve grown increasingly disturbed on hearing a description of a business seemingly unconcerned with its treatment of workers. Management disregard towards employees is often correlated with a disregard towards investors, so we began to closely examine American Logistics’ EB-5 activities.  Based on our research, we now believe that the company’s workers and EB-5 stakeholders have common interests and that there is an opportunity to work together to address a variety of issues.

This week, we bring you an inside look at American Logistics’ seemingly deteriorating relationship with its workforce and why this may be of concern to EB-5 investors.

  • On January 30, dozens of truck drivers employed at American Logistics approached company management with a request to address long standing grievances and respect their desire to have a voice on the job by forming a union. Employees have since reported retaliation and harassment from management.
  • On February 27, workers filed unfair labor practice charges with the National Labor Relations Board, alleging that American Logistics violated federal labor law. These allegations are currently being investigated by the federal government.
  • On March 1, dozens of employees, now joined by clergy and community supporters, returned to petition company executives to respect their right to form a union and refrain from unlawful behavior.

What could this mean for investors? In our experience, unresolved disputes between management and workers can be very harmful to a company. Labor conflict can lead to low morale, poor service, and potentially disruptive unrest. If disputes persist, they can affect all aspects of a company, leading to degradations in operations, financial stability, and customer relations.

Our hope is that a lengthy dispute between management and employees can be avoided at American Logistics. Unfortunately for investors the stakes appear to be quite high. A drawn out labor conflict could jeopardize investors’ two primary goals: 1) satisfaction of visa conditions; and 2) return of their invested capital.

We will continue to provide research-based analysis and on-the-ground updates to EB-5 stakeholders.

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