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How FreshDirect Delivers Misery Along With Your Groceries--And How Workers and the Community are Fighting Back

The upscale grocery delivery service pays less than $9 an hour, has faced discrimination complaints, and is a union-buster--so why is New York giving it a handout?

Photo Credit: erostend via Flickr


New York City, like most of the country, is hurting for jobs—good jobs that pay a living wage and provide benefits so that people can support their families. Yet billionaire mayor Michael Bloomberg, along with Governor Andrew Cuomo and Bronx borough president Ruben Diaz Jr., is about to hand over $129 million in public money, through tax exemptions and direct subsidies, to FreshDirect, a grocery delivery service that is notorious for underpaying its workers, has faced multiple accusations of discrimination and has been accused of using all sorts of shady tactics to block its workers from joining a union.

FreshDirect has made its home for years in Long Island City, Queens, but now claims to need a bigger facility. After New Jersey's governor Chris Christie waved a $100 million package of subsidies and tax breaks at the grocer, New York's politicians felt the need to win its allegiance back.  New York Times reporter Michael Powell wrote of the plan, “The deal puts the welfare in corporate.”

FreshDirect, which mainly delivers to affluent neighborhoods in Manhattan and Brooklyn, advertises fresh and local groceries, ready-made meals, and other attractive options to busy, middle-class urban consumers. But its delivery drivers and warehouse workers make less than $9 an hour, and the company, co-founded and headed by a former investment banker, Jason Ackerman, has no plans to deliver its products to the South Bronx community where it wants to build its 500,000-square-foot taxpayer-funded facility. New York City Public Advocate Bill deBlasio recently used the firm as an example in arguing that the city should require a stricter code of conduct for companies that receive public assistance. Currently, he wrote, “we essentially end up subsidizing some owners of big businesses to mistreat workers, keep profits for themselves and suppress fair bargaining.”

Mayor Bloomberg and borough president Diaz claimed in an op-ed that “FreshDirect is a true New York success story, growing over the last decade from a small startup to a company with almost 2,000 employees. Small businesses are the backbone of our city; when they grow, we want them to grow here in the five boroughs — not in the suburbs or in another state.”

But local activists and the company's own workers aren't sure they'll see any benefits from the move, whether in jobs or in access to better food—certainly not enough to outweigh the negative impact on their neighborhood from the company's trucks streaming in and out. While the company's workers struggle for fair treatment, South Bronx residents are organizing to protest the move.

South Bronx resident and community board member Mychal Johnson told AlterNet that the residents are tired of having their problems ignored while the city showers cash on corporations. “The South Bronx is the poorest congressional district in the nation, continuously dumped on with all the worst New York City has to offer.”

Taking Advantage of the Bronx

Currently, FreshDirect will only deliver to the wealthier, northwestern Riverdale and Kingsbridge sections of the Bronx. Ackerman, WNYC recently reported, claimed “We absolutely would be in the Bronx,” except for the fact that “we've always felt that the Bronx has not wanted our service.” He also said that while negotiating the tax break and subsidy package that would keep the company in New York, the question of whether FreshDirect would deliver to the neighborhood that will house the company never came up.

Part of the problem for the community is that FreshDirect, which sells organic and local produce as well as more familiar brand-name groceries, doesn't accept SNAP (Supplemental Nutrition Assistance Program) or WIC (Women, Infants and Children) benefits, upon which 66 percent of South Bronx residents depend to feed their families. Even some food trucks and carts accept these benefits, so residents argue that FreshDirect is perfectly capable of taking them if it wants to.