Bill Mongelluzzo, April 4, 2014, Journal of Commerce
The International Longshore and Warehouse Union this past week won several battles in its war against the Port of Portland and terminal operator ICTSI, and it lost a battle.
However, there is an undisputed loser in this two-year-old war of attrition, and that is Portland’s only container terminal. Productivity at Terminal 6 is down around 21 container lifts per crane per hour, compared to the historical 28-30 moves per hour at the terminal, the port stated. The port’s modest share of West Coast container traffic continues to shrink, too.
At play in Portland is a complex legal morass that includes a half-dozen lawsuits and National Labor Relations Board charges involving the port authority, ICTSI, which took over operation of Terminal 6 in 2010, and the ILWU.
The genesis can be traced to a jurisdictional dispute between the ILWU and the International Brotherhood of Electrical Workers over the equivalent of two jobs plugging, unplugging and monitoring refrigerated containers at Terminal 6.
The reefer issue was resolved, more or less, in a deal brokered by the governor of Oregon, which resulted in the ILWU getting jurisdiction over those jobs.
Portland’s share of the West Coast container marketPortland’s share of the North American West Coast container market has been shrinking.
While that issue was unfolding over the past 22 months, productivity at Terminal 6 plummeted. Hanjin Shipping Co., which carries more than 70 percent of the containers that are handled at Terminal 6, threatened to pull its service out of Portland if productivity did not improve.
The Port of Portland Commission approved incentive programs to keep Hanjin and other container lines calling at the port, as well as reimbursements to ICTSI for some of the costs it incurred because of lost productivity. The ILWU sued the port authority, saying Portland is illegally using taxpayer money to subsidize the terminal operator and shipping lines.
Also involved here is an antitrust claim by ICTSI against the ILWU and the Pacific Maritime Association, which is the waterfront employers’ group on the West Coast, ICTSI also claimed that the relationship between the ILWU and PMA constituted a monopoly.
Union victory in antitrust suits
District Court Judge Michael Simon on March 24 dismissed ICTSI’s antitrust claim against the ILWU and PMA, and Judge Simon also rejected ICTSI’s claim that the relationship between PMA and the ILWU is a monopoly.
Also, Judge Simon dismissed the port’s claim that the ILWU and PMA had intentionally interfered with the port’s contractual relationships. Portland was an operating port for much of its history, and it had a contractual relationship with the IBEW that dated back to the 1930s.
The ILWU is pleased with Judge Simon’s rulings, especially those involving ICTSI. The ILWU has emphasized in its various statements over the months that ICTSI is based in the Philippines.
“ICTSI’s attack on the decades-old collective bargaining relationship between the ILWU and its own employer association, PMA, demonstrates ICTSI’s arrogance and complete disregard for the rules of engagement here in the United States,” said Leal Sundet, a coast committeeman at the ILWU.
The Port of Portland expressed its disappointment over Judge Simon’s ruling. “While the port respectfully disagrees with Judge Simon’s recent rulings regarding some of the legal theories asserted by ICTSI Oregon, Inc., and the port, the main claims against the International Longshore and Warehouse Union and its locals remain,” said port spokesman Josh Thomas.
Thomas said the port and ICTSI Oregon are pursuing statutory damage claims against the ILWU. The port and ICTSI are seeking damages for the union’s “illegal boycott and slowdowns at Terminal 6 that began in June 2012,” Thomas said.
Judge rejects union challenge to incentive programs
In another ruling, Judge Simon on March 28 stated that there is no evidence, as claimed by the ILWU, that the port authority used taxpayer money to fund the incentive programs for Hanjin and ICTSI.
Thomas said a tax provision in three local counties generates about 4 percent of the port’s revenue, with 96 percent of the port’s revenue coming from its normal business transactions.The rent rebates paid to ICTSI Oregon and incentives paid to carriers come from lease payments that the terminal operator paid to the port, Thomas said.
The port authority continues its attempts to encourage a return to normal productivity at Terminal 6. As part of the agreement brokered by the governor to end the jurisdictional dispute, a tabulation of productivity at Terminal 6 is maintained and is filed with the governor’s office.
Thomas said container lifts per-hour remain far below what they were before the disputes with the ILWU began, languishing in the low 20s. The ILWU blames the low numbers on poor maintenance of the cargo-handling equipment. The terminal operator contends that work slowdowns by the ILWU are to blame, Thomas said. An independent study is being conducted into the matter.