The good news: The International Longshore & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) have announced they have reached a tentative agreement on healthcare benefits. The parties did not release the details of the bargain and stress it is subject to agreement on other issues still being negotiated. From the onset of negotiations, it was widely accepted healthcare and jurisdiction would be the most contested subjects. It’s progress.
More good news: The ILWU ratified a contract with grain handlers in the Pacific Northwest. This agreement puts to rest two years of discord in the PNW. While the details have not been made public, we do know it covers wage increases and work rule changes. This agreement is not part of the coast-wide ILWU/PMA contract, however, it has been a distraction as the ILWU/PMA negotiations were put on hold while the union dealt with the grain handlers. Let’s hope we can gain traction in the coast-wide contract now that this matter is behind us.
The wildcard: The Port of Portland has given notice to the ILWU that the two disputed reefer jobs (plugging and unplugging refrigerated containers) are going back to the International Brotherhood of Electrical Workers (IBEW) due to continued, conscientious slowdowns by the ILWU. These two jobs have been in debate for two years and have involved the National Labor Relations Board (NLRB), state governors and numerous arbitrations. In January 2014, the port allowed the ILWU to perform the tasks with the understanding productivity would improved, however, nine months later, productivity continues to suffer. The wildcard is whether or not this decision by Portland will negatively affect the coast-wide contract negotiations.
There is not much to report on this subject. By all reports, negotiations are proceeding amicably and, despite working without a contract, there have been no related disruptions at West Coast marine terminals. Certainly a welcomed development!
Over the past month, negotiations have been on hiatus three times. Last week’s break was to allow the union to caucus. Caucus affords union leadership the opportunity to present to rank-and-file members the status of negotiations thus far and to test their support or opposition to the offers on the table. The two other breaks, including the one currently in effect until Monday, August 4, are to enable the ILWU to continue unrelated negotiations in the Pacific Northwest to address an ongoing dispute between the grain handlers and the ILWU.
The contract governing dockworkers on the US West Coast expired today without a new contract in place. It was widely predicted the contract between the International Longshore & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) would not be concluded before the expiration of the previous contract. So, we are not surprised by this development.
Both sides have been very quiet on the progress of negotiations. There has been no battle in the press. There has been no public banter at all. We take that as a positive sign. If negotiations were going poorly, we would be hearing saber rattling for sure.
While we have not seen a walk off during the negotiations thus far, we are seeing a shortage of labor. As the regular longshore workers go on vacation, typical in June, there are not enough casuals to fill the open slots. Such shortages create queues, congestion, long turn times and hamper productivity.
In the May edition of our newsletter, we covered the two most significant negotiation topics, jurisdiction over waterfront jobs and the pending tax on the union’s “Cadillac” healthcare plan. Click here for a refresher.
The driver exodus brought on by months of terminal inefficiencies in conjunction with the January 2014 California Air Resources Board (CARB) drayage truck retirement deadline has resulted in tight truck capacity on the West Coast.
Add to the fray the advancement of shipments into May and June in an effort to get cargo through West Coast ports prior to the anticipated slowdowns brought about by the labor negotiations, and everyone is feeling the pinch.
More containers have to be moved with fewer drivers. It is increasingly imperative to improve the velocity at marine terminals. The system exists in a delicate balance with everyone doing their part. One hitch, and the whole house of cards tumbles.
Vessels need to arrive on time. Longshore labor needs to be available and productive. Containers and chassis need to be available. Terminal operations need to be efficient. Drivers need to be productive and able to turn multiple times.
Negotiations have begun in the contract renewal governing longshore labor on the US West Coast. The contract parties are the International Longshore & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA). By all accounts the negotiations had a positive start. That being said, a new contract is not expected prior to the current contract’s expiration of June 30, 2014.
Last month, we covered the two most significant negotiation topics, jurisdiction over waterfront jobs and the pending tax on the union’s “Cadillac” healthcare plan. If you need a refresher, click here.
Additionally, the Journal of Commerce prepared an excellent FAQ on the subject. Please read it here.
Meanwhile, cargo advancements and diversions are occurring as both importers and exporters are trying to stave off as much upheaval to their supply chains as possible during the negotiations and expected slowdowns and disruptions.