Leadership of the International Longshoremen’s Association on Monday authorized their president Harold J. Daggett to call strike when their contract expires later this month if the union is unable to agree on a new contract with employers.
About 200 ILA wage scale delegates, meeting this week in Delray Beach, Fla., with employer representatives from the U.S. Marine Alliance (USMX), voted unanimously to grant Daggett the ability to call a strike, said James McNamara, a spokesman for the union.
The contract originally was due to expire on Sept. 30, but was extended 90 days to Dec. 29, and the two sides have been holding contract talks with the assistance of federal mediators.
Talks are scheduled to resume Tuesday afternoon between the ILA and USMX, and McNamara said union members continue to be hopeful about reaching an agreement.
"The ILA to a delegate continues to hope for the best, but plan for the worst."
The ILA also released the text of a speech delivered by Daggett on Monday
in which he said while in negotiations earlier this fall the two parties “did reach tentative agreements on automation, chassis work, and the enforcement of jurisdictional issues. In other areas of contract negotiations, USMX strategy is to sell us on having the ILA pay for its own wages and benefits.”
Daggett told his membership that carriers are “taking a hard line approach on putting a 'cap’ on container royalty. They want to take money from our members, cut revenue from our Union, and then put our money into other funds. In other words, they don’t want to go into their pockets, they want us to pay for the contract.”
Container royalties are payments that ILA members receive based on the weight of containerized cargo moving through the port where they work.
Daggett told his members the royalties are “not a bonus, but a supplemental wage, and said it carriers don’t want to pay container royalties then they should bring back all the warehouses, and start stuffing and stripping again,” noting that carriers do not have to pay container royalies on containers that have been stuffed and stripped by the ILA.
He said in 2009, in order to receive a $1 dollar per hour salary increase negotiated in a prior contract, the ILA agreed to a $42 million deferred container royalty payment.
“Once again, that seems to be the theme. The carriers want us, the ILA membership, to pay for a contract,” he said.
USMX said container royalties were first established in 1960 as a way to protect members of the ILA from job losses created by containerization, but that initial reason has long been forgotten.
It added that as container volumes have increased, from 50 million tons of cargo in 1996 to 110 million tons in 2011, the cost of the royalties has increased dramatically, reaching over $211 million in 2011 alone.
At the same time, the number of longshoremen has fallen.
"Today, thousands of workers who were not even born in 1960 – or in 1968 when container royalties were first distributed – continue to receive payments that in 2011 averaged $15,500 for ILA workers at the 14 East and Gulf coast ports," said USMX on its Website
“With fewer workers and more tons, royalty payments, which are based on the weight of containerized cargo, have increased over the years. In the 14 years ending Sept. 30, 2011, the payments totaled $1.8 billion. In Savannah alone they increased from $6,028 in 1996 to nearly $36,000 per worker in 2011,” USMX said. Payments are particularly high in ports like Savannah where container volumes have soared, and royalties are shared by ILA workers, but much work at the marine terminal is done by state dockworkers who are not members of the union.
Daggett also repeated what he said is an unresolved concern by the ILA that the union may not receive royalties due to it because container weights are not reported accurately.
“We explored the possibility of a unit assessment, but after some discussions, the carriers realized that wouldn’t work. Even though they were the ones asking for a unit assessment, they never considered the negative impact it would have on the carriers with light cargo like Asia, over the carriers from Europe with heavier cargo,” he said.
“We have demanded that each container be weighed, so that we can get the accurate weight," he added. "The carriers argue that would slow down their operation. We have explained to management that there is state of the art technology that can weigh the container weight accurately right from the spreader bar.”
Not weighing containers “means unsafe containers on the terminals and roads," Daggett said.
Daggett also said he is completely against capping container royalties because for over 20 years the employers got what he said were “huge savings” from tiered wages for ILA members which were eliminated this year and because a prior cap was used to fund the union’s medical plan, MILA, and other union benefits.
The ILA president also said he is demanding there be a container royalty surcharge on automated and semi-automated container terminals.
He said while he has been open-minded about possible changes to funding the union’s medical plan “employers have now taken advantage of my willingness to listen to their ideas.” But he said “I believe we can give the carriers a little relief here.”
Daggett told his members that the union “must address the circumvention of ILA work jurisdiction through subsidiaries, joint ventures, partnerships, limited liability companies, alter ego, etc., or any other companies financially or otherwise connected to the master contract signatories.”
He singled out NYK, saying the company “went out and bought a company and their vessels, named it NYK Cool, and started moving cargo using non-ILA labor.” In 2007, the Japanese company acquired the Danish company J. Lauritzen’s 50 percent share in NYKLauritzenCool and renamed it NYKCool.
Dagget also complained said jurisdiction should “not be based on physical location of the work, and the ILA must have the right to follow the work. For example, if they automate and move any of our jobs to Indiana or India, it is still our work” - Chris Dupin