COPING WITH COVID-19 How the Refrigeration Industry is Safeguarding Employees and Operations
“Most of the companies in our industry are still working. They are considered essential,” said Gary Schrift, president of the International Institute of Ammonia Refrigeration. “They have exceptions or exclusions from their state and local governments.”
ENSURING OPERATIONS CAN CONTINUE
Lowell Randel, director of government relations at IIAR and vice president, government and legal affairs at the Global Cold Chain Alliance, said that as the pandemic took hold, the No. 1 need was for the food and refrigeration industry to be recognized broadly as part of the critical infrastructure, due to crucial role the refrigeration industry plays in the food industry and the supply chain.
“We worked with others in the food industry and government to ensure these are designated critical infrastructure activities and essential businesses, and they need to be able to operate,” Randel said. “It has been really good to see the federal government come forward and recognize our industry is essential to keeping the food supply moving.”
IIAR joined with several manufacturers, distributors, and supplychain partners in signing a letter to President Donald Trump, governors, mayors, and other local elected officials asking them to come together with uniform definitions of critical infrastructure. The letter asked elected officials to make clear which manufacturers must continue to operate, as well as to take seriously the need to transport those products and have the workforce available to keep operations running.
“As you consider national, statewide or local measures to contain the spread of COVID-19, we respectfully request that our industries be consistently designated essential and permitted to maintain operations throughout this challenging time, using the DHS [Department of Homeland Security] definition as a minimum guide to the fullest extent practicable,” the letter stated. “Our member companies are proud to support the ongoing national response to COVID-19. We will continue to act responsibly and limit the spread of the virus at our facilities. We ask that those facilities, workforces, and their supply chains continue to operate uninterrupted so that we may provide the strongest possible response for the American public.”
Additionally, in March the American Society of Heating, Refrigerating and Air Conditioning Engineers and nine other trade associations joined together to request that federal, state, and local authorities grant “essential business” status to the technicians and engineers who are tasked with keeping the American people productive, healthy, and comfortable during the crisis.
The next step was to ensure those in the industry could operate safely and efficiently, Randel said. “That means getting access to cleaning supplies, hand sanitizer, and personal protective equipment so we can operate safely and keep those critical workers safe and on the job,” he explained. “We’ve identified some private sector partnerships, such as working with the Distiller’s Council as many distilleries have diverted production from alcohol to hand sanitizer.”
KEEPING FOOD FLOWING
Panic buying, restaurant closures, and increased at-home dining prompted by the COVID-19 pandemic disrupted the food supply chain and forced companies to react quickly to adjust their operations.
“We have an emergency/disaster preparedness plan that included the ability for administrative employees to work from remote locations, but never imagined a COVID-19 type scenario,” said Michael Winburn, vice president of operations for Shetakis Wholesalers, a foodservice distributor in North Las Vegas, Nevada. “In the past 20 years, we have worked through a handful of economic and social challenges, including September 11th and other dips in the economy, but none compare to the challenges presented by COVID-19.”
As the uncertainty of COVID-19 grew, Shetakis Wholesalers reviewed every aspect of its business. Shetakis Wholesalers primarily services hotels, casinos, restaurants, independent grocery stores, schools, senior facilities, and prisons. It also operates a 3PL logistics service, Cold Storage Solution, that primarily focuses on refrigerated and frozen goods, with some dry goods.
“On March 17th, the governor of Nevada announced the ‘Stay Home for Nevada’ initiative, which mandated the closure of non-essential businesses including hotels, casinos, and restaurants. These businesses represent about 80% of our food service business,” Winburn said. “Under the mandate, being a part of the food supply chain, we are deemed as an essential business and continue to operate. Some aspects of our business are related to retail grocery, which has seen a spike but not enough to offset the loss in our hospitality-related business.”
As a foodservice distributor, prior to COVID-19, all but a very small portion of Shetakis Wholesalers’ business was food service items delivered to customers. “In the wake of consumer buying causing traditional supply chains running out of items, we have opened our product offering up to consumers,” Winburn said. He noted that the pack sizes it sells are generally not familyfriendly, but can be shared among groups such as families, friends, and neighbors. “Previously, our ‘will call’ business historically accounted for less than five orders per day. Post COVID-19, that business has soared to well over 100 orders in a single day.”
Eric Johnston, director of PSM for American Foods Group, Green Bay, Wisconsin, said American Foods has also experienced changes to its operations. “We’re seeing a shift from where we would supply more to food services, such as schools and restaurants, to more product going to grocery stores and for more personal use,” he said, adding that there has been an uptick in demand for beef. “One of our plants will normally operate between five and six days a week, and they are running seven days a week right now,” he said in mid-April.
Johnston said a lot of meat producers have had COVID-19 issues and had to shut down plants. “I don’t know how it is going to affect the industry,” he said. “You have all of that live cattle sitting there, and it isn’t moving. It is going to be interesting.”
Johnston said American Foods has disaster plans in place, but the COVID-19 crisis is different. “This is a tough one to have been prepared for,” he said.
H-E-B, a grocery chain in Texas, first implemented an emergency preparedness plan in 2009 in light of the H1N1 crisis. “On February 2nd, we dusted it off and compared the plan we had versus what we were seeing in China, and started working on Step One pretty heavily,” said Justen Noakes, director of emergency preparedness for H-E-B, in an interview with Texas Monthly.
On March 7th, the grocery chain rolled out its plan to limit purchases of certain items. “We understand our customers want to prepare by stocking up on the essentials. Texans must continue to prepare, but panic does not promote progress. In order to help ensure all can secure the products they need, when they need them, we’ve implemented limits on certain items because we know limits will help protect the supply chain in Texas,” H-E-B said in a statement.
H-E-B also increased its efforts to clean its stores. “We’ll be sanitizing our stores and hard surfaces at a higher frequency, and customers can find hand sanitizer available throughout our stores, as well as basket wipes at every entrance. We’re also conducting training for our partners to reinforce our enhanced hygiene and personal wellness measures,” the grocery chain said.
MANAGING STAFF
The novel coronavirus has changed how Americans work, with many companies ordering employees to work from home and others having to lay off workers.
Randel said layoffs have depended on the market segment. “Retail has been in high demand, but there has been a shift away from foodservice,” he said.
However, unless a facility is going to be closed, employees are still needed to maintain the refrigeration system. “I’m not aware of there being systems that are being shut down,” Randel said. “Demand for refrigeration and refrigeration support has been pretty high.”
Johnston said American Foods hasn’t had to adjust staffing, and that growing unemployment could create opportunities for the company. “We’ve had calls with our HR and have been working back channels saying, ‘Look, there is a good possibility that there is going to be a lot of good talent that hits the market because of this’,” he said. “We don’t have a lot of open positions, but our HR manager said if we have good people hit the market, maybe we need to overstaff a little bit. We’re thinking of how we can take advantage of it and find really good people.”
Because Shetakis Wholesalers’ business involves the physical movement of products, not all employees can work remotely. “Prior to the COVID-19 mandate, we had 90 employees that worked out of our facility. Today we are down to about 25 that report to the facility with frequencies similar to before the mandate. We have implemented social distancing guidelines and PPE for all employees, including administrative staff, another scenario that I never imagined,” Winburn said.
During this period of cutbacks, Winburn created incentives to keep employees close so he can fulfill his goal, which is to bring them all back when the COVID-19 crisis ends. “We are using this as an opportunity to tune processes and train some employees on the next phase of our Warehouse Management System,” he said.
As part of the federal CARES Act, there has been some financial support for businesses, including the Payroll Protection Program that offers loans to small businesses that will help them continue to make payroll. “That is probably one of the biggest programs to help support members. There are also some employee-retention tax credits available,” Randel said.
ENSURING COMPLIANCE
Ric Hartung, general manager of Process & Safety Solutions LLC, based in Pearland, Texas, said that despite recent disruptions, those in the refrigeration industry cannot take a break from Process Safety Management. “In fact, the last thing any of us need right now is a catastrophic event that results in major injuries, or worst yet, fatalities,” he said.
Hartung said that the Environmental Protection Agency and Occupational Safety and Health Administration have been conducting limited enforcement during the COVID-19 crisis, but that doesn’t mean that facilities should limit their activities related to Process Safety Management or the Risk Management Plan rule.
“With the added distractions, we should be even more vigilant now than ever before since these distractions can take our focus away from doing those things that mitigate risks to ourselves and to those around us,” Hartung said.
Hartung recommended that facilities increase employee engagement to ensure they are focusing on the task while also making sure that employees’ personal needs are met, by spending time with them virtually or on the phone asking the questions and lending support to address issues as they arise.
Hartung noted that any time a regulatory requirement date is not met, a company could be subject to citations and fines, regardless if there is a legitimate reason or not, especially when nothing was done to address the underlying risks and other mitigation measures taken. “Therefore, any postponement of critical process safety tasks must be carefully evaluated,” he said.
American Foods’ Johnston said that when it comes to needed inspections of items such as footings or underground plumbing, states or state inspectors have allowed American Foods to take and submit photos. “They’re asking us to do something, so they know it isn’t an old picture,” Johnston said. “We use contractors that the inspectors know and are very familiar with, so they are pretty open to it.”
Johnston added that all travel to plants stopped unless it was absolutely necessary. “We have a lot of projects going on, and we’re not there to manage our projects, or our projects are shut down because our contractors can’t get there,” he said. “We’re watching work pile up.”
Winburn of Shetakis Wholesalers said he has had to look at all aspects of the business and make adjustments accordingly. “Because our facility is refrigerated with anhydrous ammonia, we must continue to perform daily system checks and all maintenance as outlined in our PSM and Nevada CAPP programs,” he said. “Much of our business is related to refrigerated and frozen food, so temperature control remains essential.”
As a result, Winburn said he has extended load-shedding periods to reduce the demand on the refrigeration system and related energy consumption. “With our reduced business, we have less product being received into and shipped from the facility, which is helping in that regard for sure,” he said, adding that he is grateful that the disruption hit during what those in Las Vegas refer to as the “cooler months,” which will shift here soon.
hermal mass, along with the integrity of our facility and robust refrigeration system, allows us to currently loadshed for just over 16 hours per day,” Winburn said. “While in load-shed, the freezer air temperature increases about 10 degrees with no to very little change in product temperature.”
When the load-shed period is over, the freezer temperature drops to -9 F and satisfies within a few hours. “Unfortunately, load shedding is not a viable option for the coolers and the temperature-sensitive items within them. As we approach the warm Las Vegas summer, the freezer temperature will need to be monitored closely and control adjusted accordingly,” Winburn said.
Other refrigeration-related strategies are shifting medium-temperature/cooler loads from the medium temperature compressors to the low-temperature compressors. “While this is not a very efficient way of handling loads, it is more efficient than our smallest medium temperature compressor running mostly unloaded 24 hours a day,” Winburn said.
Winburn previously looked at the return on investment for installing a variable frequency drive on at least one of the compressors. “Based on our then normal loads, the ROI just did not pencil out. This is certainly something to consider for the future,” he said.
PROFESSIONALS TESTING CONCERNS
The National Council of Examiners for Engineering and Surveying canceled its April exam, which affected approximately 16,000 examinees, the council said. Exams usually offered once a year during the April administration will be offered in October. Johnston said he is unsure of how the cancellation will affect the industry workforce.
Winburn said RETA operator and technician certification exams are administered through proctored testing centers, which are currently closed due to COVID-19. “I feel, like other businesses, they will reopen and adjust to our changing future,” he said.
MOVING TOWARDS RECOVERY
Despite the challenges, Winburn said he thinks things will eventually return to normal. “I do not expect to return to normal to be like a light switch that can be flipped, but believe that as a company, we will emerge stronger,” Winburn said.
IIAR’s Randel said he believes the industry has done a nice job of keeping things going during the time of crisis. “That has been really good to see,” he said.
