Contract negotiations between the International Longshore and Warehouse Union (ILWU) and West Coast employers will begin May 12, the two sides said Wednesday, with the talks coming against a backdrop of vessel backlogs, congested marine terminals, and inland supply chains struggling to handle near-record cargo volumes.

The pending negotiations also come amid fears from shippers that an impasse could result in further disruption in a market that can ill afford it. Some cargo owners have already begun to shift their volumes to the East and Gulf coasts to avoid any potential problems.

The existing contract expires July 1. Given the widespread supply chain disruptions, the negotiations will be the most closely watched in years, particularly by Washington.

“We’re optimistic about negotiations and look forward to sitting down with the employers in May,” Willie Adams, ILWU international president, told JOC.com in a statement.

“When the handkerchief drops, we’ll be ready,” Pacific Maritime Association (PMA) President Jim McKenna, who will lead the employers in the negotiations, told JOC.com.

Any cautious optimism is based on the cooperation that was demonstrated by longshore workers and employers in handling the import surge that is now in its 20th month amid the COVID-19 pandemic.

“The union and the employers sat down early on in the pandemic and negotiated pandemic protocols that allowed the cargo to keep moving,” Adams said, adding that union negotiators believe they will get a “fair agreement” that protects both the safety and economic well-being of dockworkers.

Citing the fragility of the supply chain, the National Retail Federation in a Feb. 24 letter to the PMA and ILWU urged the parties to launch negotiations earlier than usual this year. While that apparently won’t happen, McKenna said the May 12 start date falls within the typical April-May time frame of past negotiations.

US Secretary of Labor Marty Walsh, speaking at an American Association of Port Authorities (AAPA) event Wednesday, urged all involved, as well as interested observers, to maintain an even keel.

“I know there is concern in the back of everyone’s head, but people are trying to make more of an issue of this than it is,” said Walsh. “The contract isn’t expired yet. We know that there could be a contract that could be a tough negotiation at the table, or we could have the contract at the table that goes smoothly. You don’t know in negotiations.”

Walsh cautioned not to judge this year’s talks on how prior negotiations played out.

“You can’t look at history of past practices to say, ‘Well, in 2014 it was pretty bad, so that means in 2022 it will be pretty bad.’ That’s not how negotiations work,” he told the AAPA event.

Automation likely to be key issue

Neither the ILWU nor the PMA has spoken publicly as to what issues they view as crucial in this year’s negotiations. However, the union in recent years has publicly opposed the spread of automation on the West Coast. The computerization of documentation was negotiated by the two sides in the 2002 contract, and that resulted in the loss of some marine clerk jobs. Automation of cargo-handling equipment was codified in the 2008 contract, which has cost the union thousands of general longshore jobs.

Employers, on the other hand, have noted that in order to continue handling record cargo volumes each year on waterfront property that cannot be expanded, some West Coast terminals will have no choice but to automate, as automation allows terminals to almost double the cargo volumes they can handle on the same footprint compared with operating manually.

The ILWU is expected to seek contractual assurances that any new jobs created by automation fall under its jurisdiction. While the union may demand “give backs” from employers that would make it easier to block future automation projects, employers have noted that the union secured large gains in pensions and benefits in previous contracts for agreeing to automation provisions.

In past negotiations, discussions involving wages normally were not a major sticking point. According to the PMA’s 2021 annual report, the average salary for full-time general longshore workers was $182,789. Marine clerks’ average salary was $203,533, while the average for foremen was $280,352.

www.joc.com