Header2014
Quick Links:





Get a Quote
 
 
 
Our Services
CUSTOMS BROKERAGE
 
FREIGHT FORWARDING
 
CARGO INSURANCE
 
PROJECT CARGO
 
CONSULTANT

C-TPAT Logo

 

 SUBSCRIBE TO JJB'S NEWSLETTERS 

Previously from JJB


February 5, 2015/  Volume 2015, Issue 4

PMA Chief Says West Coast Ports Near Complete Gridlock

Dear Valued Customer,

 

At 2 PM Pacific February 4, the Pacific Maritime Association President Jim McKenna conducted a press conference on the status of the negotiation. A video of his press meeting can be viewed here.

 

McKenna said the region's docks are nearing "complete gridlock" and raised the prospect of a lockout in 5 to 10 days unless a contract deal is reached.  McKenna told reporters that the 50% productivity decline, combined with stranding several dozen ships that can't unload because of port congestion, is forcing management's hand.

 

His news conference was the first since talks began nearly nine months ago with the International Longshore & Warehouse Union.  Almost 20,000 dock workers at 29 ports are affected.

 

McKenna said separately, "We are trying to give enough notice and lead time for businesses to make the best decisions they can."

 

The PMA official also disclosed details of a new "best offer" proposal made yesterday for a five-year contract that includes 3% higher wages, 11% higher pension benefits, and no givebacks. Average wages now approach $150,000 annually with fully paid health benefits costing employers $35,000 per worker per year, and pensions average $80,000 a year, he said. "This is a very comprehensive and generous offer," he added. "This is a true goodwill gesture to get the West Coast ports going again.

 

"A lot is at stake here," McKenna said, noting that trade through West Coast ports accounts for 12% of the U.S. gross domestic product. "It is important for both parties involved and for the nation."

 

Since May, the parties have acknowledged agreement on two issues - health care costs and chassis handling practices. Health care costs matter because union members could face higher taxes in 2018 under the Affordable Care act. McKenna said six other issues, such as wages, remain unresolved.

 

In a press release on their website, the PMA said, "PMA's offer also meets the ILWU's two biggest demands: maintenance of their Cadillac health benefits - which feature no worker premiums, no co-pays and no deductibles for in-network benefits - as well as jurisdiction over maintenance and repair of truck chassis. Those two issues consumed months of contract talks, and in both cases PMA has offered significant concessions to the ILWU. The resulting contract offer calls for a cost increase of roughly five percent each year over the life of the five-year contract.

 

However, chassis still appear to be an issue because leasing companies and others have acquired chassis that ocean carriers used to provide. That move injected a new element into chassis supply, since the owners of the equipment now aren't directly involved in contract talks.

 

PMA also said in their press release, "Despite four weeks of participation by a federal mediator, the parties have not yet been able to bridge the considerable gaps between them. The Union has recently made significant new demands, and is also insisting on changes to the decades-long process for selecting arbitrators - trying to change the rules on the waterfront in their favor, giving them the ability to unilaterally remove arbitrators who rule against them."

 

McKenna said the Union's work slowdowns are having the same result as a strike, except the workers are still getting a paycheck. He also said, "These slowdowns need to stop..." and employers "will have to decide how much longer we are going to pay longshore workers to work slowly." There are rumors that at some point the employers may not order union labor to work at the terminals (thus shutting down) over weekends, but nothing is confirmed.

 

We will continue to monitor this situation closely and will keep our customers updated.

 

Keep yourself updated with the latest industry happenings, subscribe to JJB's Newsletters

Los Angeles

Kent Sunakoda

mailto:ksunakoda@jjboyle.com

(323)263-8100 ext. 327

Portland

Lisa Whiles

mailto:lwhiles@jjboyle.com

(503)284-0909 ext. 120

Seattle

Terry Pilant 

tpilant@jjboyle.com

(206)447-9580 ext. 104 

San Francisco

Connie Arimoto

carimoto@jjboyle.com

(650)871-6334 ext. 3130

        

The information accompanying this newsletter contains confidential information belonging to the sender which is legally privileged. The information is intended only for the use of customers of James J. Boyle & Co. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the content of this information is strictly prohibited. James J. Boyle & Co. will also not be held accountable for any discrepant information. The service we provide is based on our "Terms and Conditions of Service", which is available upon request.


You are provided this copy subject to the terms and conditions of our services.  All rights reserved.