U.S. maritime labor, concerned about retaining shipper confidence badly dented during the last round of contract negotiations, is taking steps to facilitate negotiations and speed agreement with waterfront management when the next bargaining cycle formally commences, a maritime labor expert told an industry conference last week.
Leaders of the International Longshore and Warehouse Union (ILWU), which represents labor at U.S. West Coast ports, and the International Longshoremen's Association (ILA), which represents workers at East and Gulf Coast ports, have signaled they're ready to start contract discussions long before the current contracts expire. This gives reason for optimism that the labor strife that affected the East and Gulf Coast ports in 2012 and 2013, and the West Coast ports in 2014 and 2015, can be avoided this time around, Anthony Scioscia told the Coalition of New England Companies for Trade (CONECT) 21st annual Northeast Trade and Transportation Conference in Newport, R.I.
ILWU and the Pacific Maritime Association (PMA), which represents ship management, have met twice to discuss a possible extension, with modifications, of the current five-year pact, which expires on June 30, 2019. Their next meeting is scheduled for April 21, and a proposed bargaining position for the extension will be on the agenda when an ILWU caucus meets on April 24, according to Scioscia. If approved, the proposal will be sent to the rank and file to vote on, a process that usually takes about 90 days, he said.
Meanwhile, the ILA met in February with the United States Maritime Alliance Ltd. (USMX), a management group that includes container carriers, terminal operators, and port associations, for informal discussions about contract concerns and the negotiating process. Based on the results of that meeting, which both sides characterized as "fruitful and productive," the two parties decided to launch formal negotiations on wages. Once the ILA forms a "wage-scale committee," discussions will move forward, Scioscia said. The current six-year master contract expires Sept. 30, 2018.
Why are the unions ready to talk so early? "There is less confidence in West Coast labor after the port chaos of 2013. The ILWU is also worried about cargo diversions to the East Coast—it wants to attract and retain cargo to ensure work for its members," so stability is in the union's interest, said Scioscia, who said his comments represented his personal opinions. Scioscia is a former senior vice president of labor relations for Maersk Agency, a business unit of the Danish liner shipping company. He is also the former president of APM Terminals Management BV, Maersk's terminal operating arm.
There were multiple threats of work stoppages during the last ILA-USMX talks, while negotiations between the ILWU and the PMA became so protracted that President Obama directed then-Labor Secretary Thomas Perez to intervene and bring the dispute to closure. The crisis on the West Coast caused severe disruptions for U.S. agricultural exporters and led many beneficial cargo owners (BCOs) to divert import traffic to the East Coast. A portion of that diverted business never returned.
Scioscia also speculated that ILWU officials are concerned and uncertain about the Trump administration's pro-business stance, including whether the White House would take a hard line against unions using the threat of work stoppages as a bargaining tool.
Scioscia said the ILA has acted to expedite the bargaining process by agreeing to begin negotiations at the local level, where issues such as pensions, local work rules, and other port-specific matters are negotiated, and then address the "master agreement," which covers wages, health care, jurisdictional issues, and automation for all ports. Because issues at the national level would traditionally be dealt with first, local unions would sometimes refuse to ratify the master contract until their concerns were addressed and resolved, he said. Local talks usually take about 90 days, he said.
Scioscia expressed cautious optimism about the outlook. If the ILWU and PMA agree to a contract extension—which he believes is likely—then the ILA and USMX negotiations will also succeed, he predicted. The cargo diversions and economic fallout from the massive bottlenecks at West Coast ports in 2013 have had an impact, he suggested. "Both unions are very conscious of their 'market share' now" and neither wants to lose cargo to the other, he said.
Gartner, Inc.
