Bill Mongelluzzo, April 8, 2015, JOC.com
The International Longshore and Warehouse Union since June 2012 has had a running feud with ICTSI, which operates Terminal 6. Crane productivity has never returned to normal since a jurisdictional issue surfaced almost three years ago. ICTSI said dozens of ILWU “work stoppages, slowdowns and safety gimmicks” have made it difficult to keep liner services on schedule.
Elvis Ganda, CEO-North America at ICTSI, said Monday something was amiss because Hapag-Lloyd’s latest schedule showed no vessel calls in Portland. The carrier had operated a service every 10 days from the Mediterranean to Portland. Hapag-Lloyd made it official Tuesday by notifying customers that the sailing of the Seaspan Dalian on March 28 was its last vessel call in Portland.
Hapag-Lloyd had never been publicly vocal about service issues in Portland, but Hanjin was. Hanjin warned the port authority, ICTSI and the ILWU on several occasions the past three years that if productivity did not return to historical levels, it would cease its Portland operations. The port was able to keep Hanjin and Hapag-Lloyd calling in Portland through a financial incentive program the past two years. However, ICTSI said, Local 8 ramped up its job actions last November. The ILWU for the ensuing four months maintained a program of job actions at all West Coast ports when coastwide contract negotiations with the Pacific Maritime Association reached an impasse.
The ILWU’s dispute with ICTSI began in June 2012 when Local 8 claimed jurisdiction over the equivalent of two jobs handling refrigerated containers that the International Brotherhood of Electrical Workers had performed for decades when Portland was an operating port. The ILWU said that when ICTSI began operating Terminal 6 in 2010 those positions belonged to Local 10 because ICTSI is a member of the PMA, which negotiates and administers the coastwide contract with the ILWU.
Oregon’s governor actually brokered a deal that gave jurisdiction over the reefer jobs to the ILWU, but after months of poor ILWU productivity performing that work, the port authority last year gave the jobs back to the IBEW.
Bill Wyatt, executive director of the Port of Portland, said in an interview last year the feud took on a life of its own because the ILWU wanted ICTSI to leave. When Portland was an operating port, it allowed the ILWU to have work rules and concessions that were unique on the coast. The port was losing millions of dollars a year because of the inefficiencies. When ICTSI began to enforce work rules under the coastwide contract, the ILWU began to hard-time the terminal operator and never stopped, Wyatt said.
ILWU spokeswoman Jennifer Sargent said Hapag-Lloyd’s decision to end its Portland service is not surprising. “Portland is a small market and is overpriced given ICTSI’s propensity to practice monopolistic behavior and set its rates accordingly,” she said..
Ganda said that after the ILWU next month votes on the tentative coastwide contract that was reached on Feb. 20 with the PMA, he hopes to meet with the union to repair the relationship and seek new liner business for Portland. “There is substantial market demand for exporting and importing goods to and from Asia and Europe through Terminal 6,” he said.
Ganda emphasized, however, that shipping lines will only agree to initiate service in Portland if productivity returns to historical levels. “While ICTSI Oregon will continue efforts to attract new customers, no carrier will want to make a long-term commitment to the terminal so long as ILWU workers delay cargo and vessels as a strong-arm tactic to get what they want,” he said.
With the departure of Hanjin and Hapag-Lloyd, Portland’s only liner business is a monthly service provided by Westwood Shipping that had accounted for about 1 percent of the port’s container volume.
The departures of Hanjin and Hapag-Lloyd will be quite costly for importers in Portland, but even more so for the exporters of agricultural products that originate in Oregon and Idaho. Agricultural exports are often low-margin products, and cost-effective barge services on the Columbia River make Portland the ideal gateway for those exports.
Full-time ILWU workers have a measure of protection under the coastwide Pay Guarantee Plan which guarantees registered longshoremen a salary even if there is no work to perform. Portland has a strong book of breakbulk business and other non-containerized cargo. Longshoremen who had been working at Terminal 6 and who qualify for PGP must accept other work that is available, but if the loss of the container work results in a shortage of work opportunities, registered longshoremen who sign in each day will be paid for those days even if no work is available.
Under the previous coastwide contract that expired on July 1, registered longshoremen who showed up at the hiring hall each day, but had no jobs available, were guaranteed up to 37.5 hours of pay each week. If the ILWU approves the tentative contract that was agreed upon in February, the pay guarantee will increase to 40 hours a week. The hourly ILWU wage will increase $1 to $36.68, retroactive to July 1, 2014..