International Longshoremen’s Association President Harold Daggett said a meeting with management negotiators next week on the issue of container royalties will determine whether the ILA carries through on its threat of a year-end strike.
At the end of three days of meetings with United States Maritime Alliance in Delray Beach, Fla., Daggett said a bargaining session next Tuesday will focus exclusively on container royalties that provide annual payments to dockworkers.
“If we come to a decision on container royalties, then we’ll move on and not have a strike,” Daggett said. He added that if the ILA and USMX can’t work out a deal on royalties, the ILA is prepared for a Maine-to-Texas strike.
“We’re going to get the container royalties, and if we don’t, we’ll be on strike,” Daggett said. But he added, “I’ve got a feeling that if we work that out, we’ll be able to move on into the future.”
The ILA’s wage scale committee, representing East and Gulf Coast union locals, voted Monday to authorize Daggett to call a strike if the ILA and USMX can’t agree on a contract before a 90-day extension of the current agreement expires Dec. 29.
Daggett requested the strike authorization to demonstrate support for his bargaining position at the start of this week’s negotiations. The Federal Mediation and Conciliation Service is overseeing the talks.
James Capo, chairman and CEO of United States Maritime Alliance, confirmed that small committees of the ILA and USMX would meet on Tuesday to discuss container royalties. He would not comment further.
Container royalties and local work rules have emerged as top issues in this year’s ILA-USMX negotiations, which Daggett said have been “rough, rough, rough.”
“There’s a lot on the line,” he said. “The biggest thing is container royalties. We know we have to have container royalties to survive the next six years.” The ILA and USMX are aiming for a six-year contract.
Daggett has insisted the ILA would not accept an end to caps on royalties, which were established in the 1960s to cushion union members from job losses resulting from containerization.
Ocean carriers pay per-ton fees into programs used mainly to provide ILA members with cash payouts each December. Eligible workers’ checks averaged $15,500 last year, when carriers paid $211 million in royalties. Ten percent of royalty payments go to the ILA treasury.
USMX has proposed capping payouts to workers from container royalties at current levels, and using the excess to fund other ILA benefits. USMX also has proposed eliminating royalties for future hires.
It was not immediately clear how much the two sides budged from their earlier negotiating positions this week.
Besides container royalties, USMX has proposed revising the master contract to provide more flexibility in revising port-specific work rules in local contracts that supplement the coastwide master contract.
Employers want to revise local contracts to synchronize work shifts and curb payment for hours in which no work is done. The ILA is resisting those changes, aimed primarily at the high-cost Port of New York and New Jersey.
The ILA hasn’t had a coastwide strike since 1977, but this year’s negotiations have followed a rocky course since they kicked off in March.
Bargaining has been punctuated by acrimonious exchanges between Daggett and Capo. Talks broke off in August after Capo said the ILA was unwilling to consider USMX proposals.
The ILA and USMX agreed last summer on union demands for a program to pay workers displaced by automation, and on ILA jurisdiction over chassis repairs.
Negotiations resumed in September after the federal mediator became involved, but the ILA-USMX negotiations remain strained.
Last month, Daggett broke weeks of public silence by declaring that the ILA would not accept caps on payouts to workers from carrier-paid container royalties, and that the union would resist work-rule changes. Capo responded that the ILA leadership appeared to view bargaining as “a one-way street that leads only in their direction.”
The ILA’s coastwide master contract covers container and roll-on, roll-off cargo. Breakbulk shipments are covered by local contracts. Because the ILA faces non-union competition for breakbulk shipments, it would continue working that cargo even if the union struck container lines.