Handlers manage to avert shutdown of Chicago air cargo flows
Airfreight handlers at Chicago O’Hare Airport have averted a major disruption of cargo flows through ...
The US National Retail Federation (NRF) has urged President Obama to step in to prevent an east and gulf coast port strike, following the breakdown of talks between the US Maritime Alliance (USMX) and the International Longshoremen’s Association (ILA) union over the issue of container royalties. Both parties have blamed the other for rejecting to prolong the 90-day extension, brought into force when the previous contract expired at the end of September.
“The retail industry, once again, calls on President Obama to engage directly in the negotiations,” said Jonathan Gold, NRF vice president for supply chain and customs policy. “The president should utilize all available tools, including Taft-Hartley, to eliminate even the threat of a strike or lockout. The time for leadership is now.”
The economic impact of the recent strikes at the ports of Long Beach and Los Angeles was about $2.5bn per day, according to Sean Strawbridge, managing director of Trade Relations and Port Operations of the Port of Long Beach.
The east coast strike was averted just before the ports’ busiest time of the year in September when the Federal Mediation and Conciliation Service became involved and suggested the extension. But a second extension is looking increasingly unlikely, say both parties.
In a statement the ILA said: “The ILA wanted to say “Happy New Year” with a contract extension to February 1, 2013, but United States Maritime Alliance answered with a resounding ‘bah humbug’ and rejected an ILA offer to extend the deadline of the current master contract through the end of January 2013.”
Meanwhile, in the other corner, the employers’ group claimed: “While USMX agreed to the extension, ILA rejected it, refusing to discuss any changes to the status quo on container royalty and renewing its vow to strike. During a meeting December 10, the ILA Wage Scale delegates rejected the USMX proposal for a Master Contract and voted to strike when the current extension expires on December 29.”
Clearly, both cannot be right.
The deal breaker has been container royalties – a tonnage-based payment made to union members – which, said the ILA, is ‘untouchable’.
The USMX offered to protect container royalty payments at 2011 levels for current recipients for 25 years, or whenever they leave the industry, but new employees would not be eligible.
“USMX seems intent on gutting a provision of our Master Contract that ILA members fought and sacrificed for years to achieve,” said ILA president Harold Daggett. “We have repeatedly asked them to leave this item alone – it was a hard won gain by ILA members and a wage supplement achieved through hard fought negotiations.”
The stand-off could force the ILA to strike on 30 December, a move which it claims it does not want to do. Shipping lines, which have to give a month’s notice, have announced surcharges.
“USMX and its members are disappointed with the breakdown of negotiations and the inflexible stance that the union’s leaders have maintained over the nine-month course of these talks,” said James Capo, USMX chairman and CEO. “It is especially disheartening given the history of cooperation that in the past has characterized negotiations with the ILA and, since 1977, has resulted in nine new agreements without a single strike or coast-wide work stoppage.”
The USMX said it had also offered a six-year contract, and that tentative agreement had been reached on three key issues: protection for individuals who may be displaced as a result of new technology and automation; the ILA’s continued jurisdiction over chassis maintenance and repair work in marine terminals and port areas covered by the master contract; and strengthened authority of the joint ILA/USMX jurisdiction committee to resolve disputes.
It also claims to have offered two wage increases of $1 each over the terms of the agreement, while the ILA’s average hourly rate would increase to more than $55, including overtime and container royalty. It also promised guaranteed funding for healthcare benefits, operational improvements and funding for local ports experiencing difficulties.
The NRF’s Mr Gold added: “It is extremely disheartening to learn that the two sides failed to reach an agreement during today’s negotiations. NRF urges both sides to remain at the table until a deal is reached.
“It is imperative that both sides verbally announce their intentions to return to the negotiations. A coast-wide port shutdown would have a significant impact across all businesses and industries that rely on the ports, particularly retail.
“The last thing the economy needs right now is another strike, which would impact all international trade and commerce at the nation’s East and Gulf Coast container ports. This is truly a ‘container cliff’ in the making.”
The Taft-Hartley Act, which was last invoked in 2002 by President Bush when talks failed at west coast ports, can suspend shutdowns for 80 days if deemed vital to the US economy and military.