Earning His Stash

Lyndon Johnson was president, the country was at war and a year that started with the Green Bay Packers winning the Super Bowl boiled over in a summer of civil unrest. There was rioting in Detroit, Birmingham, Rochester and Harlem, and by the end of 1967, much seemed lost.

For Jaguars owner Shahid Khan, though, 1967 was a time of opportunity. In January of that year, a bus pulled into Champaign, Illinois, and a 16-year-old Pakistani boy walked down its steps. He carried a suitcase with all his belongings inside and $500 in savings. He didn’t know anyone. He had never seen snow, and there was three feet of it covering the ground. As Shahid Khan walked to the YMCA to rent a room, his thin-soled shoes fell to pieces. After putting down $2 for the room and buying a sandwich for 50 cents, he would later joke with Jacksonville Magazine, he feared he was going to “burn through his stash.” But when he landed a job the next day, washing dishes for $1.20 an hour, he was already earning more than 99.9 percent of the people back home in Pakistan. He’d left his family in Lahore to study industrial engineering at the University of Illinois, and he found school hard. He even thought at first about quitting. “If I can make this kind of money without a degree, why go to college?”

Khan’s story is no simple rags-to-riches tale. His family was from the educated class in Pakistan. His father was an attorney and his mother was a math professor. He joined the big fraternity on campus, and after working two and three summer jobs, he bought a Karmann Ghia and then an Alfa Romeo. But there’s no doubt that his humble arrival yielded amazing success. While still in college, he began working for the Flex-N-Gate auto parts manufacturer in Urbana, Ill., and continued there after graduation. One of his assignments was to design a better bumper, and he ultimately founded his own company that manufactured a seamless truck bumper that wouldn’t rust or corrode. He purchased Flex-N-Gate in 1980, and since then, the company has grown to employ more than 13,000 people at 48 plants in the U.S. and abroad. Khan’s bumpers are on two-thirds of the pickup trucks in North America and his plants make chrome and plastic parts for Ford, General Motors, Nissan and Toyota. The company earned $3.5 billion in 2011. Forbes estimates his individual worth at $2.5 billion.

Despite his wealth, Khan the executive maintained a low profile. For most of the 31 years that Khan ran his company, he didn’t give interviews, and he was uncomfortable with the coverage he did get. When Forbes wrote a January 2009 piece saying Khan and his wife had “ducked” an $85 million tax debt, he complained the article was a “hatchet job.” (Khan paid $68 million to settle the matter.)

But ever since Nov. 29, 2011, when Wayne Weaver announced he was selling the Jaguars to Khan for $760 million, Khan has become a national figure and a bit of a cult hero. He is the first non-white person to own an NFL team, a fact that the media has celebrated. And despite his mind-boggling wealth, he’s invariably described as a regular guy, of humble origins. Khan has been accepting of the attention, some of which he has clearly enjoyed. (Who would protest if The New York Times described you as a “rakish figure”?) During an interview with Mike Ozanian on Forbes SportsMoney, Khan teared up as he talked about how Jags fans wore fake black mustaches to the first game after the big announcement. When Khan recovered his humor, he cracked that his mustache was stimulating Jacksonville’s economy, through T-shirt sales.

But Khan’s national profile may yet prove a liability. His newfound popularity has been seized upon by current and former employees of his chrome-plating plants in three states, who want to use the national stage to pressure him to address safety and working conditions at his non-unionized plants. According to Chris Schwartz, research coordinator for the United Auto Workers union, employees are routinely exposed to hazardous dust, aren’t properly educated about the risks of exposure to hazardous chemicals and are not receiving annual testing of toxin levels as required by the Occupational Safety and Health Administration. Says Schwartz, “I would not say the plants are now safe.”

In addition to union pressures, there are lingering environmental concerns at a shuttered, but not officially closed, Detroit plant. According to former employees and residents who live near the Chrome Craft plant, decades of leaks, spills and other environmental violations have rendered the soil and groundwater in and around the plant toxic and potentially hazardous. The group is pressuring the state to step up testing of the site and ultimately hopes to use the state’s data to force Khan to pay for cleanup or remediation.

Under the confluence of pressures, Flex-N-Gate has thus far offered only terse responses, delivered through attorneys, saying that the company meets or surpasses environmental and OSHA regulations. Khan himself has retreated to his private world where he refuses to speak to the media. And the company itself has offered only unified silence. When Folio Weekly contacted Flex-N-Gate, looking for someone to respond to workers’ allegations, the receptionist noted the company doesn’t give comments. Just to clarify her position, she added, “I certainly wouldn’t have anything to say.” When informed that a more official response was needed, she offered the number of an attorney in Canada, who asked Khan spokesman Jim Woodcock to call. He, in turn, promised a written response to the issues after he had a chance to “think things through.” He has never responded.

On March 14, a floor supervisor at the MasterGuard plant in Veedersburg, Ind., instructed an employee to dump an unmarked container of liquid into a vat of detergent, according to subsequent complaint filed with the Occupational Safety and Health Administration. The mix caused a violent chemical reaction that burned the employee’s legs and caused one woman to collapse from the fumes. Sandra Garretson, who has worked at the plant for a year and a half, covered her face with a sweatshirt so she wouldn’t breathe the smoke, which she said smelled horrible, like a broken sewage line. She followed the other employees to a breakroom, where they were corralled for hours until plant managers said it was safe to return to the floor. Garretson went home instead, but says the terrycloth jacket that she had with her that day gave her a rash when she wore it again days later.

Garretson, who subsequently filed the OSHA complaint, is one of a growing number of employees who hopes to use the public spotlight on Khan to pressure him to sign a contract with employees, guaranteeing safer workplace practices. “He wouldn’t dream of making bumpers for GM or Toyota or Ford or Nissan without a contract,” says Garretson. “Why does he expect us to work for him without a contract?”

Similar pressures are building around the Midwest. At town-hall-style meetings in March held near the University of Illinois campus and near the idled plant in Highland Park, Mich., current and former employees rallied to unionize Flex-N-Gate plants. They contend they aren’t taught about the dangers of the chemicals they handle, that the containers they use aren’t properly labeled, that they aren’t trained in what protective gear they should use. And several raise the question of whether Khan, on his rise from dishwasher to executive, lost sight of the workers. Although the company posts a heartening document, titled “The Social Principles of the Flex-N-Gate Group,” which pledges “support for universal human rights,” and to pay employees enough “to enable them to meet at least their basic needs,” some workers say that’s pure fiction. Jackie Robinson from the Guardian West plant in Urbana told Folio Weekly he couldn’t afford the $230 a month for company-sponsored health insurance, but is worried because his lungs hurt and he wakes up at night unable to catch his breath. Another worried about the risks posed by fumes from the polishing stations. Veedersburg, Ind., employee Butch Pollock said he placed a large magnet near the station and tiny metal shavings from the fumes coated it within 12 hours.

Creating a plastic bumper that has the look of shiny chrome is achieved by electroplating metals with a series of finishes, including hexavalent chromium, a chemical compound that Erin Brockovich made famous when she found it had contaminated the drinking water in the Southern California town of Hinkley. In the electroplating process, high exposure to hexavalent fumes can cause lung damage or even lung cancer. Prolonged contact with the skin can cause lesions and allergic reactions.

Former employees of the shuttered Chrome Craft plant say that on-the-job exposure to chemicals is only part of the problem. They allege that company practices imperil neighborhoods. At a March 22 meeting at Greater St. Matthew Baptist Church in Highland Park, Mich., former employees and neighbors of the idled plant appealed to officials of the Michigan Department of Environmental Quality, asking the agency to test soil and groundwater in the area. Former Chrome Craft employee Mike Miley described how toxic sludge leaked out of containers in the company parking lot and washed during rainstorms into an alley that separates Chrome Craft from a row of single-family homes. Neighbors corroborated the story, saying they played as children in the alley and noticed a greenish liquid on the snow around the plant. When the sludge would overflow the tank, Miley said, plant managers had him and other employees smooth the sludge out with shovels instead of removing it.

DEQ Communications Manager Brad Wurfel pointed out that employees didn’t alert the agency when the alleged violations occurred, and noted that the plant has been shuttered since 2009. The plant was not officially closed, which some suspect was a ploy to forestall a more thorough environmental property assessment by DEQ. Wurfel said that isn’t the case. But since the meeting, the agency has begun to conduct limited testing of groundwater and soil on the Flex-N-Gate site.

Pastor D. Alexander Bullock of the Greater St. Matthew Baptist Church, which sits four blocks from the plant in Highland Park, says environmental contamination hasn’t been a local priority. The state of Michigan took over Highland Park from 2000-’09, after the city declared bankruptcy. Then, he says, Highland Park lost 80 percent of its tax base. “In a situation like that, the government apparatus doesn’t really deliver,” says Bullock, who is also president of the Highland Park NAACP. “Corporations located in cities like Highland Park tend to fly under the radar.”

Bullock became concerned about possible contamination from the plant when the city joined Detroit’s urban gardening initiative to turn vacant lots into vegetable gardens. “I began to become concerned about it when we had urban gardens growing squash and peppers and collard greens very, very close or even on industrial sites,” he says. “Then I stumbled onto Chrome Craft and the violations cited and the potential toxicity of the soil and water.”

Although there is no evidence yet that the plant operated in violation of environmental law, a Freedom of Information Act request filed with the Department of Environmental Quality turned up 39 health and safety violations at Chrome Craft during four inspections in the past 20 years. The allegations have caused some residents to suspect the worst. Speaking at the March 22 meeting, a woman who grew up near Chrome Craft said she knew of 13 people who had died of cancer on her one block. And UAW Vice President Cindy Estrada spoke of Khan as the billionaire who grew rich while disregarding the health and safety of those who worked for him.

“Shahid Khan is one of those employers that if the community doesn’t stand up is going to continue to pollute the groundwater and soil and not care that children are playing in these chemicals that cause cancer,” she told the crowd. “He thinks he can get away with it.”

Saad Bolos, an Iraqi immigrant who worked at Chrome Craft for 17 years and sports his own bushy mustache, told the Highland Park audience that it took a while for him to understand the dangers the plant posed. When the company brought in bottled water for employees, he said, “We thought they loved us.” He says he later learned that their drinking fountain water was contaminated. He spoke of a pipe break that he said spilled hexavalent chromium onto the plant floor. He said he could show the DEQ exactly where to test the soil. Then Bolos shouted at the audience. “I’m asking everybody,” he said. “Let’s clean America. Let’s clean America.”

In March, Flex-N-Gate released the results of three months of OSHA testing at the Urbana plant for residue on nine employees of five contaminants: hexavalent chromium, chromic acid/chromates, sulfuric acid, hydrochloric acid and nickel, all used in electroplating. Exposure limits were within acceptable levels in all the samples.

But Sandra Garretson, who works as a detailer on the General Motors line, checking bumpers for defects and wiping down the finished chrome surface, isn’t convinced. She doesn’t work directly with chemicals, but when she walks through the polishing department to get fresh water, she worries about breathing in those toxins. When she gets home, she blows black snot out of her nose. The bumpers reach her station spotted with dried blotches of hexavalent chromium, which she’s learned is reconstituted when she washes it down with water. Sometimes, she says, there are puddles of the chemical on the backside of the bumper. She wears surgical gloves, but she’s bothered that she hasn’t received training on the chemical from Flex-N-Gate and, she says, solvents are stored in unmarked containers without warnings or exposure risks.

“How can I make an informed decision whether I feel my job is more important or my health, if I don’t know what the overall hazard might be?” she asks. “Everybody should know what chemicals we are working with. Every chemical should have proper identification, have its legal name on the label, say what protection is required when using it and list all the health risks.”

Indeed, better labeling of chemicals is a cornerstone demand of the union effort that the UAW is pushing at 12 of Khan’s 25 processing facilities in the U.S. So are better worker training and pay. Even though one in four of the company’s North American employees are already unionized, the UAW says the company has worked hard to block additional unionization efforts, exploiting the lack of cohesion created by a multilingual workforce — particularly at the Urbana plant, where roughly one-third are French-speaking Congolese workers, and one-third Spanish-speaking Latin American immigrants. Union reps also accuse the company of altering workers’ schedules to derail organizational meetings and, in one case, of attempting to orchestrate an eviction of several Congolese tenants in retaliation for union organizing.

It’s not yet clear if the UAW will succeed in organizing workers, or whether renewed attention at the shuttered Michigan plant will lead to a cleanup. But there’s little doubt that the adoration and attention that Shahid Khan has enjoyed here in Jacksonville is viewed as leverage at his factories around the country. The Horatio Alger-style story that has proved so irresistible to media types is just as attractive to his detractors, albeit for very different reasons. “The fact that Khan can donate money for a state-of-the-art health building, but refuses to provide basic health and safety for his workers is outrageous,” notes one activist website. “[P]oliticians and business leaders venerate Khan for his philanthropy, but ignore the manner in which this entrepreneur has acquired his fortune.”

It was a sentiment echoed last week at a protest at the NFL Draft headquarters in New York City, where union reps and residents of Highland Park marched to draw attention to the disparities between Khan and his factory workers.

“The NFL has admitted Shahid Khan to one of the most exclusive clubs in America,” said Pastor Bullock, days before the protest. “We’re not sure they really know about the harm caused by his business practices — and we’re coming to New York to make sure they find out.”

Susan Cooper E

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