unionized
A trade union (British English) or labor union (American English), often simply referred to as a union, is an organization of workers whose purpose is to maintain or improve the conditions of their employment, such as attaining better wages ...
Elizabeth, New Jersey
Elizabeth is a City (New Jersey), city in and the county seat of Union County, New Jersey, Union County, in the U.S. state of New Jersey.US Northeast when it entered
Chapter 11
Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, w ...
bankruptcy in 2019 and subsequently shut down all operations in 2020.
History
The origins of the company go back to 1918 when a small trucking company began hauling products for the National Biscuit Company (later known as
Nabisco
Nabisco (, abbreviated from the earlier name National Biscuit Company) is an American manufacturer of cookies and snacks headquartered in East Hanover, New Jersey. The company is a subsidiary of Illinois-based Mondelēz International.
Nabisco' ...
) and Fair Lawn Dairies in northern New Jersey. Fair Lawn was later acquired by
Bergen County, New Jersey
Bergen County is the List of counties in New Jersey, most populous County (United States), county in the U.S. state of New Jersey.Farmland Dairies who also eventually bought the trucking company. At around the time of its acquisition, the carrier was renamed New England Motor Freight (NEMF).
In 1977, Farmland sold NEMF to New Jersey trucking executive Myron "Mike" Shevell. Shevell had started his career in trucking as vice president at the Apex Express trucking company in the 1950s and later operated and managed Associated Transport, which at one point was the United States' largest trucking company, starting in 1974. Associated Transport entered bankruptcy in 1976 and a year later NEMF became part of the Shevell Group, of which Shevell was chairman.
At the time of its acquisition, NEMF was facing significant competition in the Northeast and operated 55 trucks from five terminals. But, over the decades following acquisition and the 1980 deregulation of trucking, NEMF grew substantially especially when compared to other unionized carriers of the time. It continued to provide services in the New York–New Jersey metropolitan area but eventually served as far as Chicago, Canada, and Puerto Rico. In 1986, it bought Interstate Dress Carriers.
Bankruptcy
On February 11, 2019, NEMF filed for
Chapter 11
Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, w ...
bankruptcy citing rising overhead costs and a shortage of drivers, officially closing its doors one year later.
According to the company, the decision to file for bankruptcy and wind down its operations came after two years of losses and an unsuccessful effort to renegotiate credit agreements with its lenders. Its bankruptcy was the largest in the transportation industry since the 2002 bankruptcy of Consolidated Freightways.
In addition to NEMF, the bankruptcy included 10 other Shevell Group companies including NEMF subsidiaries transportation management and freight brokerage firm NEMF Logistics, air and ocean freight forwarder for Puerto Rico NEMF World Transport, and cross border freight service provider NEMF Canada which had served Ontario and Quebec. Additionally, the bankruptcy filings included Shevell Group companies
South Brunswick, New Jersey
South Brunswick is a Township (New Jersey), township in Middlesex County, New Jersey, Middlesex County, in the U.S. state of New Jersey. The township is centrally located within the Raritan River, Raritan Valley region and is an outer-ring subur ...
-based dry van and flatbed carrier Eastern Freightways, third-party-logistics provider Carrier Industries Inc., and truckload freight brokerage firm Apex Logistics. While most of these were liquidated, Eastern Freightways and Carrier Industries were acquired out of bankruptcy by Estes Express.
Operations
At the time of its bankruptcy, NEMF was the 17th largest LTL carrier in the US in 2017 with revenues over . The company had 3,745 employees including over 1,300 drivers and operated approximately 10,000 pieces of equipment including 1,500 company-owned
tractors
A tractor is an engineering vehicle specifically designed to deliver a high tractive effort (or torque) at slow speeds, for the purposes of hauling a Trailer (vehicle), trailer or machinery such as that used in agriculture, mining or constructio ...
, an additional 247 owner-operator tractors, and almost 5,600 trailers. It also had 40 terminals across the Northeast,
Midwest
The Midwestern United States (also referred to as the Midwest, the Heartland or the American Midwest) is one of the four census regions defined by the United States Census Bureau. It occupies the northern central part of the United States. It ...
, and Puerto Rico.
Unlike most LTL carriers whose workers are unionized under the Teamsters Union, NEMF's union workers were mostly under the
International Association of Machinists and Aerospace Workers
The International Association of Machinists and Aerospace Workers (IAM) is an AFL–CIO/ CLC trade union representing over 600,000 workers as of 2024 in more than 200 industries with most of its membership in the United States and Canada.
Orig ...
(IAM).
Controversies
Accusations of Mafia connections
Mike Shevell and NEMF were both accused of having connections to the
American Mafia
The American Mafia, commonly referred to in North America as the Italian-American Mafia, the Mafia, or the Mob, is a highly organized Italian-American criminal society and organized crime group. The terms Italian Mafia and Italian Mob apply to ...
, according to an investigation conducted by the federal government. In a racketeering suit filed by the US Attorney in 1988 Shevell was accused of making Mafia payoffs and having an eleven-year corrupt relationship with Tony Provenzano, a Genovese family mobster and former union leader who was convicted of racketeering and murder. The matter was settled with no admission of wrongdoing.
Alleged inadequate termination notice
Following NEMF's bankruptcy, the company was sued by a group of approximately 350 employees claiming they had not received adequate notice of termination in violation of the federal
WARN Act
The Worker Adjustment and Retraining Notification Act of 1988 (the "WARN Act") is a United States labor law, U.S. labor law that protects employees, their families, and communities by requiring most employers with 100 or more employees to provi ...
which requires 60 days notice of mass layoffs. Employees also claimed they were owed additional wages and accrued vacation time. This resulted in the company increasing its termination package to employees to a total of from an initial severance offering of . Following the company's move to increase severance pay, the employees dropped their suit alleging WARN Act violations.