U.S. West Coast shippers invoke specter of port shutdowns

By Reuters

Feb 04, 2015 11:35 PM EST

The chief labor negotiator for shippers and terminal operators at 29 U.S. West Coast ports raised the ante in contract talks with the dockworkers' union on Wednesday, warning that ports plagued by chronic cargo slowdowns were days away from complete gridlock.

But union officials downplayed the potential for shutdowns, suggesting management was exaggerating a crisis as a late-hour negotiation ploy, and countered that the two sides were already close to a settlement.

The contract talks, joined in recent weeks by a federal mediator, have coincided with protracted cargo backups hampering freight traffic through waterfronts handling nearly half of U.S. maritime trade and more than 70 percent of imports from Asia.

The companies have repeatedly accused the International Longshore and Warehouse Union, which represents 20,000 dockworkers, of deliberately orchestrating work slowdowns at the ports to gain leverage at the bargaining table.

The union has denied this and faulted the carriers themselves for the congestion, citing numerous changes in shipping practices singled out by port authorities as contributing factors.

A settlement was thought to be at hand last week after nearly nine months of talks following a breakthrough agreement on a key point of contention: maintenance and control of freight chassis used to haul cargo from ports to warehouses. In August, the parties announced a deal on healthcare benefits.

But James McKenna, chief executive of the companies' bargaining agent, the Pacific Maritime Association, said on Wednesday the two sides remained at odds on several issues, including wages, pensions and arbitration to settle contract disputes.

At the same time, he said, worsening slowdowns in cargo traffic through the ports, with freighters stacking up at anchor waiting to be unloaded, had pushed the system to "the brink of collapse."

While insisting the companies had no intention of declaring a worker lockout, a scenario that could ultimately trigger federal intervention, he said ports were becoming so gridlocked that operations could effectively be shut down in the next five to 10 days.

"That will entail either us not calling for labor, because there is no point in having it, or labor going on strike," he told reporters during a telephone conference call.

Union president Robert McEllrath accused management of posturing. "This is the second time in recent memory that the employers have threatened to close ports at the final stages of negotiation," he said in a statement. The union, he added, has not gone on strike over its coast longshore contract since 1971.

The last time dockworkers' contract negotiations led to a shutdown of the West Coast ports was in 2002, when the companies imposed a lockout that was lifted 10 days later under a court order sought by President George W. Bush.

McEllrath said the parties were very close to a final accord and the union had dropped most of its remaining issues to help reach a settlement, leaving just a few that "can be easily resolved."

McKenna, however, accused the union of obstinacy in the face of what he called a very generous management proposal that includes a 14 percent base wage hike over five years, higher maximum pension benefits and an increased pay guarantee to 40 hours a week.

Nevertheless, he said, talks were continuing and "hopefully we'll find a way forward," McKenna said.

Wednesday's exchange marked the latest round in an escalating war of words between the union and management blaming each other for cargo slowdowns that began in October.

The congestion has been most pronounced at Los Angeles and Long Beach, the nation's two busiest shipping hubs. Over the past two days, port authorities there reported more than 20 freighters left idled at anchor, waiting for berths to open up.

L.A. port spokesman Phillip Sanfield called the levels of congestion unprecedented, and said it would take weeks to clear the cargo backlog once operations returned to normal.

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