The tentative West Coast waterfront contract that the International Longshore and Warehouse Union will vote on next month includes plenty of perks for the union and could revolutionize how day-to-day disputes on the waterfront are adjudicated.
But more than nine months of negotiation and the resulting standoff that brought ports to the brink of gridlock all could be for naught if ILWU locals decide to reject the tentative agreement over manning issues.
The tentative agreement that was signed on Feb. 20 by the ILWU and the Pacific Maritime Association includes wage increases that are more generous than in previous agreements, full dockworker maintenance of benefits to be paid for by the PMA and a new arbitration system that replaces individual arbitrators in the local ports with a three-member panel.
JOC.com received a copy of the ILWU/PMA Pacific Coast Longshore and Clerks’ Agreement that was tentatively approved by the ILWU and PMA after nine months of negotiations, the last four of which were tarnished by work slowdowns that contributed to severe congestion at West Coast ports. The contract, if approved, will run for five years.
The 70-page document addresses issues such as straight-time wages, skill differential pay rates, pensions and welfare, improvements to the pay guarantee plan, a chassis inspection and repair requirement and changes to local contracts on the coast.
The ILWU will invite 90 delegates from all port regions to a caucus in San Francisco scheduled for the week of March 30. The delegates will vote either to recommend approval or rejection of the agreement. If the delegates vote against the agreement, the ILWU and PMA will return to the bargaining table. If the caucus votes to recommend approval, the local leadership will hold meetings with the rank and file in their respective ports. Voting by the membership will be by secret ballot in April.
Changes to the arbitration process are the most significant provision. These changes could actually be interpreted as a victory for employers in a contract that otherwise was a resounding success for the ILWU. The proposed arbitration process would establish a three-member panel in each of the four port regions. One arbitrator would be nominated by the PMA and another by the ILWU. The third position on the panel would be filled by a neutral person, who is a non-lawyer, but who is a member of either the Federal Mediation and Conciliation Service or the American Arbitration Association.
Under current procedures, there are four local arbitrators — one each in Seattle-Tacoma, Portland, Northern California and Southern California. The arbitrators in Los Angeles-Long Beach and Seattle-Tacoma are nominated by the ILWU and approved by the PMA. The arbitrators in Oakland and Portland are nominated by the PMA and approved by the ILWU. Each local arbitrator handles the health and safety and work-rule disputes that occur regularly at West Coast ports.
For example, if longshoremen walk off the job because of a dispute over manning, the arbitrator is called. The arbitrator listens to evidence and rules on the legality of the job action. If either party disagrees with the local arbitrator’s decision, the matter is elevated to the coast arbitrator in San Francisco. Employers claim that some job actions are legitimate, but others are nothing more than the ILWU hard-timing a terminal operator in order to achieve a certain end.
When a contract expires, the arbitration process is suspended. If the ILWU refuses to extend the previous contract, as it did on July 1 last year, the union is free to engage in work slowdowns. The PMA noted repeatedly in recent months the ILWU work slowdowns aggravated already existing congestion at West Coast ports and resulted in 40 or more vessels being idled each week outside the ports.
The proposed arbitration panel could result in a more equitable arbitration process. Under the new system, it is assumed that the votes of the ILWU-nominated and PMA-nominated arbitrators will oftentimes cancel each other, and the neutral, professional arbitrator will cast the deciding vote. This could bring more balance to all of the ports, because under the old system an ILWU-nominated arbitrator usually ruled in favor of the union and the PMA-nominated arbitrator usually ruled in favor of the employer.
The wage increases in the proposed agreement appear to be higher than in past contracts. In most contracts from the early 1980s through 2013, the increases varied between 50 cents and $1 per hour. Under the tentative agreement, the hourly wage will increase $1, retroactive to June 28, 2014. The base wage will increase $1.50 in 2015, $1.25 in 2016, $1.50 in 2017 and $1.25 in 2018 when the straight-time wage will become $42.18 an hour. There will also be wage increases for skilled worker categories, with skilled-pay differentials ranging from 15 to 30 percent on top of the straight-time wage. Many positions on the waterfront include skilled-pay differentials, which accounts for the average annual earnings of full-time longshoremen in 2013 being $147,000, according to the PMA.
Some employers say the more generous wage hikes reflect a realization on the part of the ILWU that automation and the use of information technology are eliminating certain jobs, so it is time to focus on higher wages for those jobs that remain. Others say the annual increases are greater, but the percentage increase stays about the same. Others say somewhat cynically that when the ILWU drags the negotiations on for nine months and creates great harm to ports, employers, cargo interests and the national economy, the higher wage increases simply corroborate the ILWU’s negotiating strategy, which is that the longer the negotiations last, the more the union can obtain from employers.
Automation was not addressed directly in the tentative agreement because employers in the 2008 contract achieved the right to introduce any types of automated cargo-handling equipment they wish. Manning of the new machines is determined on a terminal-by-terminal basis. Employers say the ILWU local may hard-time a terminal as it prepares to automate cargo-handling functions in order to secure a certain level of manning. Normally a compromise is reached and the automation is implemented.
The contract also includes an interesting provision on chassis inspections and maintenance and repair work. The tentative agreement gives the ILWU mechanics the jurisdiction to inspect and repair non-trucker-owned chassis. “Red-circled” terminals that have contracts with other unions such as the International Association of Machinists are also exempt from ILWU inspection and repair provision.
Chassis jurisdiction was an important issue in the negotiations and delayed a settlement. Now that ocean carriers have sold most of their chassis to equipment-leasing companies, there is some question as to the legality of terminals requiring that the ILWU inspect chassis before they leave the facilities, and requiring that the ILWU perform any needed repairs. The chassis-leasing companies are not PMA members and they have no contractual relationship with the ILWU.
The tentative agreement states that both parties will petition the Federal Maritime Commission on the chassis provision, and if anything in the requirement is judged to be illegal, the PMA and ILWU will renegotiate those provisions to make them legal.
During the contract negotiations last fall, the California Trucking Association charged that in order to hard-time employers, the ILWU was requiring drivers to exit their trucks while the longshore mechanics performed lengthy inspections that went beyond the normal eight-point inspection. Those actions also aggravated the port congestion problem and cost the drivers time and money because drivers are paid by the trip.
If the contract is approved, the ILWU will not be held financially responsible for any delays and extra costs associated with the lengthy, tumultuous negotiations. The proposed contract states, “There will be no discipline, grievance or legal claims, and any pending claims will be withdrawn, against the union or any individual bargaining unit worker for any acts of alleged misconduct that may have occurred between July 1, 2014, and the signing of the 2014 Memorandum of Understanding.”
The PMA and ILWU declined to comment on the details of the tentative agreement, and they refused to speculate on its chances of being approved by the rank and file. Employers generally expect ILWU Local 10 in Oakland to vote against the contract, which that militant local usually does, even when the contract is approved by the other locals on the coast. This time, Local 10 attempted to increase the number of dockworker positions for cargo-handling equipment, but that demand did not make it into the final agreement.
The key to passage will be with Local 13 in Southern California, which is by far the largest local. President Bobby Olvera is considered a major player in the fate of the contract. During the lengthy negotiations, Olvera pushed for a provision that would guarantee ILWU mechanics in Los Angeles-Long Beach 10 hours of pay each day even if the mechanics work only eight hours. That demand was rejected. Olvera last week was re-elected president of the local. It is not known if he will recommend a vote against the agreement in order to re-open that issue. Olvera declined through a spokesman to comment for the story.
Another interesting provision in the proposed contract is that the existing arbitrators in Northern and Southern California “shall be released within 14 days of ratification of the contract.” Another ILWU demand that held up negotiations was that the ILWU and the PMA be allowed to unilaterally fire an arbitrator at the end of the contract. The PMA resisted that demand, saying that the ILWU wanted to get rid of the arbitrators in Northern and Southern California only because those arbitrators ruled against the ILWU at times.