Shippers, Union Set Strategies for Summer Port Strike

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Shippers, Union Set Strategies for Summer Port Strike

By DAVID GREENBERG

Staff Reporter

With both sides bracing for a threatened July 1 strike, maritime companies and the union representing port workers are developing strategies as they weigh the effects of a shutdown of West Coast ports.

Representatives of the Pacific Maritime Association and the International Longshoremen and Warehouse Union are refusing to speak to the media during negotiations, only agreeing to release joint statements as progress is made. Others in the industry, however, say that if there is a strike, the union holds the upper hand because of the potential economic effects worldwide.

After two weeks of talks, no progress toward a settlement has been made, a maritime company source said last week.

In the past, the PMA has done whatever it could to avoid a strike, which would halt the $309 billion in container cargo that passes through West Coast ports annually, including more than $200 billion in L.A. and Long Beach.

“If it gets down to that, I think management will cave in as they have in the past,” said Robin Lanier, executive director of the West Coast Waterfront Coalition, which represents retailers and transporters. “The customers would be the ones hurt most by this. They will call the ship companies and say, ‘You’ve got to make this go away. We’re dying here.’ When you get to that point, principle goes out the window. The union knows that. So they want to put the PMA in the hot seat.”

This year, the agency has threatened to shut down the ports if the union stages the kind of work slowdown the PMA claimed took place during bargaining talks of 1999 and 1996, causing productivity to drop 20 percent to 50 percent per port. (The union denies a slowdown occurred.)

“The sides have given themselves four weeks to negotiate a contract with a lot of very complicated issues,” Lanier said. “That makes the people looking through the key holes nervous.”

Implementation of new technology is the major issue in talks between the PMA and ILWU, which began May 13, for a new three-year contract to replace the one that expires July 1.

Overall, the union might be in a stronger bargaining position because the PMA would bare the brunt of a downturn in the economy brought on by a work stoppage, maritime officials said.

With average annual wages totaling $83,000 for longshoremen, $118,000 for clerks and $158,000 for foremen, ILWU workers, who want an additional $1 per hour in the new contract, could conceivably live off savings for a while.

“They certainly have a lot of discipline among their rank and file and a long history of militancy,” said Gary Smith, West Coast representative of the International Brotherhood of Teamsters’ port division, which signed a memorandum of agreement to support the ILWU. “Employers always try to ascertain how much cohesion there is among the workers because they can split one group against another. But in this case I don’t think they’ll be successful.”

Effect on economies

Although the huge maritime companies have the financial muscle to withstand a prolonged work stoppage, the real losers would be the U.S. and Asian economies.

“The blink won’t come from the ship companies or the unions,” said Stephen Cohen, co-director of the Berkeley Roundtable on the International Economy. “They can sit out a storm much longer than the U.S. economy can sit. The union guys are very well paid and the shop owners are big companies with lots of assets and big credit lines.”

A 10-day work stoppage would create a $19.4 billion loss to the national economy and cut $693 million in local, state and federal tax receipts, while a 20-day strike would slash $48.6 billion from the economy and $1.8 billion in taxes, according to a study by Cohen’s office.

That has maritime officials questioning whether the PMA could withstand intense pressure from importers and exporters to reach a quick settlement if a strike or lockout occurs.

The ILWU has not staged a strike since 1971, when workers walked off the job for more than 100 days. Back then, however, there was no global economy or just-in-time-delivery, and it was easier to reroute the ships to smaller ports.

“The impacts were not terribly significant,” said Cohen. “They were nothing like they are now. That’s the core of the problem. Nobody has warehouses full of merchandise anymore.”

To prepare for a projected doubling of container traffic over the next decade, the PMA wants to install high tech equipment that automatically issues work assignments to longshoremen and retrieves and transmits container information it directly into terminal data bases.

Those tasks are currently done manually, which the PMA charges is time consuming and costly.

Although the agency acknowledges that hundreds of clerks’ positions would be eliminated, they have guaranteed that those personnel would be offered retraining for other dock assignments.

But those guarantees have been made only to current workers and the ILWU charges that the technology will take away many jobs from the next generation of workers.

Union officials want to retain those positions and get back clerk positions they claim have been eliminated over the past decade when management hired non-union workers for as little as $10 per hour to track cargo by computer from out of state.

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