Friday, July 11, 2014

Any Port in a Storm?

West Coast longshoremen’s union negotiations enter delicate phase.

Operations remain normal – for now – at the terminals of West Coast shipping ports covered by the International Longshore and Warehouse Union (ILWU).

With a preponderance of U.S. importers sourcing goods from the Pac Rim, wholesalers and retailers in this country have a lot at stake in a resolution to the contract negotiations currently under way to keep the containers offloading. The old contract between the ILWU and the Pacific Maritime Association (PMA) expired July 1 without an agreement, and while the two sides agreed to keep talking, the ILWU refused to extend the previous contract while the negotiations continued.

Throwing an additional monkey wrench into the works, the Teamsters union began a job action against several trucking carriers operating at the ports, seeking to organize the owner-operators, whom the union says should properly be classified as employees. The Teamsters threw up picket lines on Tuesday morning, and ILWU members briefly walked off the job in support, before an arbitrator ruled they should return to work. This ruling was possible only because the longshoremen’s contract with PMA was temporarily extended, but the brief stoppage allowed the ILWU to demonstrate support for their fellow union, while keeping with their tradition of not allowing third parties to influence their operations.

The agreement to extend the previous contract expires July 11, the same day negotiations are to be resumed, and the pressure is on them to find common ground. The union wants a three-year agreement, while the port operators are seeking more longterm stability through a six-year pact. If a significant work stoppage occurs, President Obama could invoke the Taft-Hartley Act to compel renewed operations, as President Bush did in 2002.

All a shipper can do is stay tuned for developments, work with knowledgeable professionals to keep their  options open, and keep in mind the old adage “any port in a storm.”

Kirk Shearer
1-800-989-0054 x103

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