West Coast dockworkers reach deal with shippers

The last six-year contract covering dockworkers expired July 1 without a strike or lockout, with both sides insisting they wanted to keep the ports running smoothly — even if they had to keep talking after the deadline. The decision was a welcome break for the teetering U.S. economy, since the billions of dollars in cargo handled by the 29 ports represents about 11 percent of the U.S. gross domestic product.

The Associated Press

7/30/2008

LOS ANGELES — The union representing thousands of West Coast dockworkers has reached a tentative contract deal with shippers that promises to keep ports — and the economy — running.

The International Longshore and Warehouse Union announced a six-year agreement Monday with the Pacific Maritime Association — a proposal that still needs to be ratified by union and PMA members.

Neither side released details of the contract, which came after months of negotiations.

“The ILWU negotiating committee is very pleased and feels like they met their goals of good jobs, safer jobs and an agreement that will help dockworkers and nearby communities,” said union spokesman Craig Merrilees.

PMA spokesman Kevin Elliott said the deal, if ratified, would “return the ports to a productive, safe and efficient state.”

The agreement covers more than 25,000 dockworkers at 29 West Coast ports.

The last six-year contract covering dockworkers expired July 1 without a strike or lockout, with both sides insisting they wanted to keep the ports running smoothly — even if they had to keep talking after the deadline.

The decision was a welcome break for the teetering U.S. economy, since the billions of dollars in cargo handled by the 29 ports represents about 11 percent of the U.S. gross domestic product.

In addition, neither side wanted a replay of the bitter 10-day lockout in 2002 that caused an estimated $15 billion in losses.

Tension grew after the contract expired, as shippers accused dockworkers at the twin ports of Long Beach and Los Angeles of intentionally slowing cargo movement.

The Pacific Maritime Association, which represents 71 shipping companies and terminal operators, claimed workers were taking coordinated breaks and working at a slower pace to drag down productivity at the nation’s largest port complex.

Shippers could not contest what they believed to be disruptive job actions because employees were working without a contract. The union, which represents 26,000 workers at ports in California, Oregon and Washington, insisted the shippers were exaggerating.

There has also been tension with salary claims made by the shippers.

Elliot said the average full-time dockworker made $136,000 in 2007, placing them among the best paid blue-collar workers in the nation.

Merrilees called the figure “absolutely, positively, patently false.” He said workers typically earn $30.68 per hour, though this is augmented if they work overtime or have special skills.

The union has previously stressed that only about 10,000 of the 25,000 workers covered by the current contract work full-time or more hours.

With a tentative deal in place, the union’s 100 delegates will have until Aug. 18 to decide whether union members will vote on the proposal.

Paul Bingham, an economist with the research firm Global Insight, said the struggling economy and upcoming presidential election added pressure to reach a deal.

The union previously reached an agreement with shippers on a health care plan expected to cost about $500 million this year.

The union had sought to retain its fully funded plan that required no worker contributions, had zero deductibles and provided $1 drug prescriptions.

Shippers wanted to contain costs, which they said had climbed from $202 million in 2002 to $419 million last year.

The shipping association pushed to maintain worker productivity as the ports move more cargo in the coming years.

The ports handled 12.2 million cargo containers last year and accounted for an annual domestic impact of $1.2 trillion, about 11 percent of the U.S. gross domestic product, the association said.

That volume marked a 45 percent increase from 2002.

The ports of Los Angeles and Long Beach alone handled about 40 percent of the nation’s container cargo.

In response to the lockout in 2002, President Bush became the first president in a quarter-century to invoke the Taft-Hartley Act of 1947 and ask a federal judge to force some 10,500 workers back to work to help resolve a national economic crisis.

The judge consented, paving the way to a mediated settlement during a cooling off period. The deal introduced computerized cargo tracking in exchange for increased compensation and pension benefits.