News / Canadian strike ends as ILWU, BCMEA accept mediator’s terms

© Sehenswerk

The port strike that paralysed most cargo moves through Canadian west coast ports since 1 July moved closer to its end yesterday.

Both the ILWU and British Columbia Maritime Employers Association (BCMEA) endorsed the compromise suggested by a federal mediator, opening the way to ratification by their respective members.

According to an operations update by the port of Vancouver, some operations were already set to resume yesterday afternoon, hours after the two sides signalled acceptance of the proposed four-year labour agreement.

However, it will take some time to work through the backlog, according to eeSea.

“Both Vancouver and Rupert face a significant amount of delays, port swaps, and diversions that come on the heels of this latest development. We expect the railways, shippers, and ports will be feeling the operational effects of this for many weeks to come.”

Canada’s labour minister, Seamus O’Regan, decided on Tuesday that the two sides were not far enough apart to justify a continuation of the strike, which has cost Canadian trade an estimated C$500m ($379m) a day.

A designated mediator hammered out a compromise proposal, presented to the ILWU and the BCMEA on Wednesday with a 24-hour deadline to signal whether or not they would accept it and pass it to their members for ratification.

“The strike is over. […] The parties have reached a tentative agreement,” minister O’Regan tweeted yesterday morning and, in a joint statement with transport minister Omar Alghabra, thanked both sides.

“The scale of this disruption has been significant. The extent of it has shown just how important the relationship between industry and labour is to our national interest. We do not want to be back here again,” they said.

The terms of the deal have not been made public yet. Sources close to the negotiations said remuneration and union jurisdiction over terminal maintenance work had been the biggest stumbling blocks.

According to one report, the BCMEA’s final offer had been a 14% pay rise over four years, whereas the union was asking for 17% over two years plus a C$8,000 lump sum payment. In the last round of talks, on Monday, the employers had reportedly offered some concessions on ILWU jurisdiction on terminal work.

While the agreement needs to be ratified by the members of both organisations, port activities are expected to resume without significant delay.

But eeSea said: “Since yesterday we have had one more confirmed diversion and one more confirmed port swap. That brings the current tally to 10 port swaps and six diversions.

“These adjustments are being reported by carriers now well into mid-August, and while it remains to be seen whether or not there will be more omissions of the CA ports in the tail end of next month or even into September, it certainly isn’t out of the question.”

Shipping line Maersk advised customers yesterday that port operations at Vancouver and Prince Rupert were set to resume later in the day, adding that the truck gate at Vancouver’s Deltaport container terminal would restart operations the following morning.

And rail operations are set to resume shortly; Canadian National expects most of its ramps to be accepting empties and exports again within 48-72 hours. Maersk advised customers to pick up imports from the rail ramps as soon as possible to reduce the potential for congestion, noting that the rail carriers had already pre-staged equipment to expedite the restart of operations upon conclusion of the strike.

It will take some time to clear the backlog. The port of Vancouver reported that yesterday four containerships were at anchor and another 10 offshore. The Greater Vancouver Board of Trade estimates that some 63,000 containers are on vessels waiting to be offloaded at the port.

“What the loss of this business means for Canadian stakeholders in a broader economic sense, particularly with peak season just around the corner, also remains a burning question on everyone’s minds,” added eeSea.