The much-anticipated negotiations on a new contract to replace the current one between the International Longshore and Warehouse Union (ILWU) and their employers at 29 West Coast ports, represented by the Pacific Maritime Association (PMA), started Monday.
The current agreement covers 20,000 workers, and expires July 1.
PMA said there are 13,600 "registered" longshoremen (those who are registered to work, sign up at the dispatch hall, and work or either receive the pay-guarantee program benefit if there is not enough work; and about 8,000 "casuals" who make themselves available for work, as conditions may offer.
ILWU noted that only about 45 percent of its members get full-time work.
Negotiations are expected to last at least through the end of June,
and possibly into early July, past the end of the current contract.
In a statement, the PMA said it believed the talks “provide an
excellent opportunity to enhance the competitiveness of West Coast
ports, ensuring effective, productive terminals that support workers in
local port communities and beyond. These negotiations are especially
timely, as West Coast ports have lost significant market share in recent
years, and face renewed competition from Canada, Mexico, the Panama
Canal, the Gulf States, and the East Coast.”
The PMA said in its 2013 annual report that imports have fallen from 48.6 percent in 2008 to 43.5 percent in 2013.
The ILWU said resolutions for the upcoming contract, developed by 90
delegates and dozens of pensioners who gathered in San Francisco for the
Coast Longshore Division Caucus in February and March, generally
concerned jurisdiction, technology, wages, safety and benefits.
“Longshore members and clerks have made it clear that they want a
contract with stronger safety provisions, more secure benefits, greater
respect for ILWU jurisdiction, and a reasonable approach to new
technology,” said ILWU International President Bob McEllrath in an
article in the union’s newpaper. “We intend to work hard and negotiate
the best possible agreement, and now we’ve got a good road map to get
The talks are expected to initially begin with a meeting at the
headquarters of the PMA. During the next two months, they will continue
there and at the union’s headquarters, both of which are in San
Jim McKenna, the president PMA, wrote in his group’s annual report,
“Given the tremendous economic impact of our industry across the nation,
we will act with an awareness that these talks have ripples far beyond
the docks.” According to PMA, the “the 29 West Coast ports serve as a
crucial foundation for the U.S. economy, supporting 9 million jobs
across the nation, with a domestic business impact of $2.1 trillion
annually. Closer to home, the ports’ economic activity has fueled
growth and prosperity in local port communities and throughout the
In 2002, an impasse in negotiations led to a 10-day lockout of union
workers that resulted in hundreds of ships not being unloaded. A
contract agreement was reached only after President George W. Bush used
the Taft-Hartley Act to get the two sides back to the bargaining table
and the terminal reopened.
Industry executives say that they are still optimistic that a new
contract can be reached without a work disruption, believing language in
the current contract can help the industry and union negotiate around
issues having to do with automation, expected to become increasingly
important as larger containerships begin calling West Coast ports.
PMA said in its statement that it and its members "are focused on
delivering a contract that ensures the West Coast’s standing as the
gateway of choice for goods sent to and from Asia, while continuing to
provide an outstanding compensation package to ILWU workers," but one
major issue during the talks is expected to be the cost of healthcare
benefits, and the tax imposed by the Affordable Care Act on generous
health care plans.
The PMA says in its annual report
that employers spend more than $1.6 million per day for health coverage
for ILWU registrants, retirees and their dependents, but the PMA says
the cost of the new tax could be more than $100 million per year.
If employers have to pay for that tax and do not have enough money to
sign the obligation for that tax for six years, the two sides may end
up negotiating a shorter term, three year contract instead of a six year
deal, officials have said.
A group of nearly 70 organizations representing manufacturers, farmers,
wholesalers, retailers, distributors, and transportation and logistics
providers, including the U.S. Chamber of Commerce, National Association
of Manufacturers, and National Retail Federation, sent McEllrath and
McKenna a letter
on Friday urging them to "make every attempt possible to conclude an
agreement on a new contract before the current contract expires on June
30. It is critical that a new agreement be reached without disruptions
to the movement of freight."
The business groups urged the involved parties "to stay at the
negotiating table until a deal is reached
even if negotiations extend beyond the current contract expiration,"
adding that "failure to reach an agreement will have serious
They explained that the uncertainty surrounding the
labor situation at the West Coast ports is hurting the economy by taking
the focus of businesses away from competing and shifting it to
"We all know the impact of the West Coast lockout 10 years ago on the
U.S. economy, including the businesses which rely on the ports to move
their goods and on the employees who depend on fully operational ports.
While the circumstances were different at that time, these same
companies just experienced the tumultuous negotiations impacting the
East Coast/Gulf Coast ports where constant threats of disruption created
high levels of uncertainty at a tremendous cost," they wrote, making reference to the
contract negotiations in 2012 and 2013 between employers and the
International Longshoremen's Association and employers on the U.S. East
and Gulf Coasts.
"The West Coast ports and their customers cannot afford to go through
a similar situation again," the businesses told the PMA and ILWU.