ILWU Showdown Looms

An armchair analysis of West Coast longshoremen goes like this: With things looking bleak on the West Coast, the International Longshore and Warehouse Union will want to ensure a disruption-free negotiation for a contract to replace the six-year agreement that expires on June 30, 2014.

You name the issue: The U.S. West Coast is losing market share to Canada (Canada’s west coast container market share grew from 7.5 percent in 2000 to 13.9 percent last year); growth is almost nonexistent (total container volume at Los Angeles-Long Beach increased just 1.5 percent in the first half of 2013); the Panama Canal is being expanded, likely diverting at least some cargo to the East and Gulf coasts; and Maersk Line and other carriers are using the Suez for their largest Asia-to-U.S. tonnage. There is widespread terminal overcapacity, especially in Oakland and the Pacific Northwest.

All that said, it would be naïve to think the ILWU’s reputation with customers will drive its negotiating posture next year, especially when there are other issues more near and dear to the union’s heart that are more likely to take center stage, and possibly lead to trouble.

One such issue is jurisdiction, due to what Pacific Maritime Association President Jim McKenna described as unions’ “combative, emotional” desire to protect their turf from non-union and other union labor and to expand jurisdiction where possible.

“Maintaining and expanding jurisdiction will rule the day,” McKenna said last month, due to automation reducing core job opportunities, as reported by JOC Senior Editor Bill Mongelluzzo.

In Portland, the ILWU last year failed to oust workers from the International Brotherhood of Electrical Workers who handle reefer functions at Terminal 6, though the issue is tied up in litigation. Looking to next year, non-ILWU labor working at some 30 container, chassis and reefer maintenance and repair yards up and down the West Coast will likely come up at next year’s talks, as the longshoremen covet that work also.

But even before next year’s talks begin, a jurisdictional and contractual showdown involving Pacific Northwest grain terminals is poised to blow up. Depending on how it plays out, it could spill over into the container talks. Nine elevators in the PNW load deep-water bulkers with wheat, corn and soybeans originating in the Upper Midwest and other areas including Idaho, Oregon and Washington state.

The operators, which include Mitsui, Louis Dreyfus, Cargill and Marubeni, pay similar wages and benefits as their container operator counterparts. But as these facilities have become more sophisticated, the operators have balked at traditional union work practices, including the summoning of labor from hiring halls where they get non-regular workers less familiar with the operation, slowing productivity.

After a violent confrontation last year settled only after intervention by Washington’s governor, one of the operators, EGT in Longview, signed a contract with the ILWU local that achieved significant work rule changes at its new $200 million elevator. These included drawing from a limited pool of qualified, preauthorized dockworkers and a requirement that the union pay financial damages for delays caused by work stoppages when the grievance process results in a favorable ruling for the employer.

The other operators want similar deals, which, although preserving ILWU work at EGT, undermined the union’s traditional power. Two elevators, Columbia Grain at Portland and United Grain at Vancouver, Wash., in the spring locked out the ILWU over other issues and have been working the elevator and vessels primarily with management and some temporary, non-union employees.

This by itself is an extraordinary development given the ILWU’s traditional vice grip on nearly all West Coast ship operations. Pilots, tug crews and workers at railroads that bring in the majority of grain into the facilities — the Coast Guard has proposed “safety zones” around grain ships — are under pressure from longshoremen to prevent ships from loading.

Pickets are up, and the stage is set for confrontation, which could begin with the fall harvest and significant pickup of vessel activity. The ILWU has filed a series of unfair labor practice petitions pertaining to the lockouts with the National Labor Relations Board, which may or may not rule in the union’s favor. Beyond that, the union’s strength lies in the actual or threatened disruption of cargo flows.

But how this would be achieved in this case is an open question. The railroad workers, tug crews and pilots are bound by their own contracts and laws to cross picket lines, so the ILWU may have few options other than violence.

If the union were to be forced to accept EGT-type agreements at the other terminals, or, in a much less likely scenario, lose the work at other terminals entirely, it could embolden the ILWU leadership in San Francisco to be more aggressive in the container talks to maintain support of their rank-and-file.

No matter how much the West Coast may be struggling, that could be a recipe for rough container talks.

Peter Tirschwell is executive vice president/chief content officer at JOC Group. Contact him at ptirschwell@joc.com and follow him at twitter.com/PeterTirschwell.

 

 

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