Expert weighs in: Port shutdown is not an empty threat

Sarah Aitchison, February 5, 2015, Puget Sound Business Journal

The fingers just don’t stop pointing in negotiations at the ports.

The Pacific Maritime Association, which represents terminal operators at ports along the West Coast, made a contract offer Tuesday to the union that represents 20,000 dockworkers.

Then, PMA President Jim McKenna held a press conference and said West Coast ports were going to shut down in five to 10 days if the International Longshore and Warehouse Union didn’t sign the contract.

He said the ports would shut down completely because of pressure on the system and overcrowding, and the PMA would be left with no other option but a worker lockout.

The ILWU responded by saying that the two parties were close to an agreement, and that shutting down the ports now would be irresponsible. On Thursday, the union sent out another press release, which included pictures of West Coast ports with plenty of space for containers.

In the press conference, McKenna said the contract terms offered were the best the PMA could provide. It includes an annual starting income of $147,000 with the opportunity of a 3 percent to 5 percent raise every year and a fully paid “Cadillac” health plan for union members. The contract would be valid for five years.

In response to a question, he said, “I never characterize anything as ‘best, last and final,’ but it’s my best offer.”

McKenna said there were fewer than 10 points of contention left to work out with the union. He added they were far apart on about half.

“What the ILWU heard yesterday is a man who makes about $1 million a year telling the working class that we have more than our share,” said ILWU President Robert McEllrath. “Intensifying rhetoric at this stage of bargaining, when we are just a few issues from reaching an agreement, is totally unnecessary and counterproductive.”

So was the threat of a shutdown a bargaining tactic by the PMA? Or is a shutdown of West Coast ports a real threat?

It’s a bit of both, said Bruce Carlton, president and CEO of the National Industrial Transportation League, a lobbying organization for shippers.

“I think what the PMA did yesterday was to say, ‘Let’s turn up the volume,’ and they cranked it up pretty hard,” he said.

But Carlton also said that while it might have been about putting pressure on the union to sign a contract, but there is also a real possibility the ports will shut down. A bluff doesn’t have any bargaining power.

For Carlton, the language is key.

McKenna said the PMA made its best offer, but he would not say “best and final.” Without using those words, the door to a signed contract isn’t completely closed.

“[Best and final] is significant language in labor negotiations,” Carlton said, “and I didn’t hear it. I think they are at each other. They are getting on each other’s nerves, that is for sure.”

But while the door isn’t completely closed, Carlton said that his organization along with other trade associations in the Washington, D.C., area are ready to take action if the negotiations don’t progress and West Coast ports do shut down.

That action would be to request President Barack Obama invoke the Taft-Hartley Act, which says that the president can take executive action forcing a shutdown industry to reopen if said industry operates internationally or across multiple states.

Former President George W. Bush invoked the Taft-Hartley Act in 2002 when the PMA and ILWU were renegotiating a contract that resulted in West Coast ports shutting down for 10 days. The U.S. economy lost an estimated $1 billion a day while they were shut down.

“Don’t be surprised if [trade organizations] collectively go to the White House to ask for the Taft-Hartley process to begin. And it is a process. We are not going to stand idly by watching the two sides continue their press release sparring,” Carlton said. “We are going to ask for an action that would force them to begin working again.”

But even if the contract is signed soon and the ports begin operating at normal efficiency, he said, it will take a long time to clean up this mess.

The PMA and ILWU have been renegotiating an expired labor contract for nearly nine months. Beginning Oct. 31, the PMA began accusing the union of intentionally slowing down work to gain bargaining power. The ILWU denies those claims and says major changes in the industry by the terminal operators the PMA represents are the cause of slowdowns.

Since then, trade organizations and businesses have begged the terminal operators and workers to get back to working efficiently. Businesses have laid off employees, lost contracts and agricultural goods have been left sitting at the docks to rot.

At the beginning of January, the two parties requested help from a federal mediator. Since then, they have reached agreement on at least one issue.

 

 

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