ILA ReachesTentative Agreement

Looks as if there won't be a strike at the U.S. Atlantic and Gulf Ports.   The agreement is
not yet signed, but they are close.

Here's the press release

Friday, February 1, 2013 Contact: John Arnold
For Immediate Release Director of Public Affairs
Web site: www.fmcs.gov Phone: (202) 606-8100

Update on United States Maritime Alliance
And International Longshoremen’s Association
Labor Negotiations

WASHINGTON, D.C. — Federal Mediation and Conciliation Service Director George H.
Cohen issued the following statement today on the labor negotiations between the United States
Maritime Alliance and the International Longshoremen’s Association:
“I am extremely pleased to announce that the parties have reached a tentative agreement for a
comprehensive successor Master Agreement. The tentative agreement is subject to the
ratification procedures of both parties and, as well, to agreements being achieved in a number of
local union negotiations. Those local negotiations are ongoing and will continue without
interruption to any port operation. Out of respect for the parties’ ratification processes, and
consistent with the Agency’s long-standing confidentiality policy, we will not disclose any
details concerning the substantive provisions that have been reached.”
“However, as the negotiations have been conducted under the auspices of the FMCS,
commencing last September and continuing to date, I can report that the tentative agreement
reflects the culmination of good faith negotiations in which the parties successfully
accommodated strongly held competing positions because of their commitment to problem
solving. Again, collective bargaining has proven its worth by avoiding a potential work stoppage
that would have had a severe negative impact on the nation’s economy.”
“On behalf of the FMCS, I want to especially convey my thanks to ILA President Harold
Daggett and USMX Chairman and CEO James Capo for their leadership, patience, and
persistence and to their respective hard-working negotiating committees. Finally, my colleagues
Deputy Director Scot Beckenbaugh, Director of Mediation Services Jack Sweeney, and
Commissioner Pete Donatello provided valuable assistance both to me and the parties throughout
this lengthy process.”
###
The Federal Mediation and Conciliation Service, created in 1947, is an independent U.S. government
agency whose mission is to preserve and promote labor-management peace and cooperation.
Headquartered in

U.S. East/Gulf Port Strike Postponed for 30 days

It has been agreed to extend the current contract for 30 days, which will postpone the
strike until Jan. 29 (I guess).

I still think there will be a strike, so this will give a chance for everyone to increases their
inventories to get them through the strike.

Why the ILA will strike

As just posted, I think the ILA will go on strike Dec. 30.  At the moment both sides
are meeting with a mediator, but in my opinion, the most that will happen is the contract
will be extended.

If they do this, it is only postponing the strike.   I don't think the ILA will give in.  They want
to continue some stupid payments that were put in place to appease the union when containerzation
came in to place so the union members loaded big containers (you all know what an ocean
container looks like), rather than bags and boxes.

This took place in the 1960's.  That is more than 50 years ago!!

In my opinion, the ILA management is totally out of touch with reality.  Within the last
few years it has been shown there is still mob control of the union, with "Christmas payments"
being made by the membership to the union bosses.

The union bosses need to be replaced.   Only when this occurs will a reasonable contract
come in to place, and the ports and carriers can move forward with needed improvements.

Just saying...

Plan for strike Dec. 30 at U.S. East/Gulf ports.

I think the ILA will strike, and according to Bloomberg, the general belief is Obama will not
intervene (at least in the short term).   The strike will begin Sunday, Dec. 30.

All of the carriers have filed a strike surcharge, so it is the importers and exporters who
will help foot the bill for the additional costs.

The winners will be the railroads, and truckers, who will be moving the cargo from the U.S. West Coast
or Canada to the final destination.

From Bloomberg (click here for link)

President Barack Obama is facing pressure to block a strike that would gridlock eastern U.S. ports and risk damaging industries from retail to manufacturing.
Federal mediators have been pushing for a deal between dockworkers and their employers before a Dec. 29 deadline. Talks between the International Longshoremen’s Association and the U.S. Maritime Alliance broke down last week amid a dispute over container royalty fees, levies that supplement wages.

A dockworker walkout would be the first at East Coast and Gulf Coast ports since 1977, and would halt shipments of containerized cargo, including clothing, frozen foods and car parts. Photographer: Ken James/Bloomberg

1:31

Dec. 27 (Bloomberg) -- Sheila Dharmarajan reports on the possible strike by the International Longshoremen's Association that would stop the unloading of shipping containers in New York. She speaks on Bloomberg Television's "In The Loop."

4:23

Dec. 27 (Bloomberg) -- Matthew Shay, chief executive officer of the National Retail Federation, talks about the possibility that U.S. lawmakers will reach a budget agreement before Jan. 1 and avert the so-called fiscal cliff of tax increases and spending cuts. Shay also discusses a possible strike by U.S. dockworkers and the outlook for U.S. retail sales. He speaks with Erik Schatzker on Bloomberg Television's "Bottom Line." (Source: Bloomberg)

A walkout would be the first at East Coast and Gulf Coast ports since 1977, and would halt shipments of containerized cargo, including clothing, frozen foods and car parts. Obama would be left to choose between forsaking a pro-labor stance by invoking the 1947 Taft-Hartley Act and allowing a union action that could compound the effects of the fiscal cliff.
“To throw that kind of a strike on top of the economy right away in January, I’m sure is something the administration would rather not see,” Mike Asensio, a labor lawyer at Baker Hostetler LLP in Columbus, Ohio, said in a telephone interview. “Would it create that much of a nightmare for him that they would be willing to do something that would anger part of their constituency in organized labor? That’s the $64,000 question.”
Matt Lehrich, a White House spokesman, declined to comment beyond a statement last week that the administration was monitoring the situation and urging the parties “to continue their work at the negotiating table to get a deal done as quickly as possible.”

Salvaging Talks

The Federal Mediation and Conciliation Service, which has guided talks since September, organized a meeting between the two sides this week in an 11th-hour effort to salvage negotiations. All three parties declined to provide further details on the new talks.
“I believe in my president, and I will follow him down whatever road he leads us,” Carl Chiofolo Jr., a union member and clerical worker at New Jersey’s Port Elizabeth, said in a phone interview. “Solidarity is the No. 1 thing here. We have to keep together on this. It literally is a fight for our lives.”
If federal mediation fails, the only remaining tool in the government’s arsenal is Taft-Hartley, which empowers the president to intervene in strikes that are deemed national emergencies, said Phillip Wilson, president and general counsel at the Labor Relations Institute in Broken Arrow, Oklahoma.
The act was last invoked by President George W. Bush in 2002 after a lockout closed West Coast ports for 10 days. The most recent successful use prior to that was in 1971 under President Richard Nixon.

Retail Pressure

The National Retail Federation and Florida Governor Rick Scott have urged Obama to use the law to avoid an eastern port shutdown that they say would cripple an already weak economy.
“The threat to national health and safety that would result from mass closure of the ports cannot be overstated,” Scott, a Republican, wrote in a Dec. 20 letter to Obama. “The Taft-HartAct provides your administration with tools that can help avoid this threat.”
On a conference call with port directors today, Scott said he hasn’t yet received a response from Obama and reiterated his call for an intervention. About 550,000 people depend on Florida ports directly and indirectly for their jobs, he said.
The Port Authority of New York and New Jersey said a strike would cost the region an estimated $136 million a week in personal income and $110 million in economic output.
“Any disruption to port activity will negatively affect tens of thousands of local jobs as well as both the regional and the national economies,” Steve Coleman, an authority spokesman, wrote in an e-mail. “We urge the parties to resolve their differences as soon as possible.”

Labor Support

Even as pressure for action mounts, Obama may hesitate to undermine the union’s bargaining power, Bradford Livingston, a partner at Seyfarth Shaw LLP, said in an interview from Ch


Labor unions “continue to be one of the bigger donors of the Democratic Party,” Livingston said in a phone interview. “As the top Democrat, even though he may not be re-elected, he’s going to want to be a friend to organized labor for the next four years.”
The Longshoremen’s political action committee gave 96 percent of its $549,050 in 2012 election donations to Democratic candidates and committees, according to the Washington-based Center for Responsive Politics. Obama didn’t accept PAC contributions for his re-election campaign.

West Coast

Calls from the Retail Federation for presidential intervention during an eight-day strike last month at the Port of Los Angeles and adjacent Port of Long Beach went unheeded. A strike at East Coast and Gulf Coast ports would need to last at least as long or longer before Obama steps in, according to the Labor Relations Institute’s Wilson.
“The president intervening is a big deal,” he said in a phone interview. “At the end of the day, the way these situations are supposed to work out is the parties inflict whatever pain they can on each other and then they reach a deal.”
Still, with the fiscal cliff of more than $600 billion in spending cuts and tax increases looming at the end of the year, the president won’t be able to linger on the sidelines, said Jock O’Connell, international trade adviser at Los Angeles-based consultant Beacon Economics LLC.
“There’s always the possibility that the mediators will lead the respective parties to come to a solution before the strike,” O’Connell said in a phone interview. “After that, then the clock starts ticking. The precedent in this case is about a 10-day clock before pressure on the White House to invoke Taft-Hartley starts becoming irresistible.”

Additional charges if there is a strike.

From The Journal of Commerce

Surcharges will take effect if ports shut down in labor dispute

Several container ship lines have announced congestion surcharges that will take effect if East or Gulf Coast ports are closed in connection with the International Longshoremen’s Association contract expiration.

The carriers are required to provide 30-day notice of the surcharges, which will be rescinded if the ports stay open. Among the announced surcharges:

-Maersk, for all shipments to from the U.S. and Canada: $800 per 20-foot container, $1,000 per standard 40-footer, $1,125 per 40-foot high-cube, and $1,266 per 45-foot container.
-Cosco, for shipments between Asia and from the U.S. and Canada: $800 per 20-foot container, $1,000 per standard 40-footer, $1,125 per 40-foot high-cube, and $1,266 per 45-foot container.
-NYK Line, for shipments to the U.S. from Asia, the Indian subcontinent and Australia: $1,000 per container.
-Hanjin, for shipments to and from U.S. and Canadian ports, $800 per 20-footer, $1,000 for other sizes.

I don't really know how they can justify these as "congestion surcharges", because no one knows
for sure what ports will be congested.  I really think these should be filed under "strike surcharge",
but of course there could be lots of service contracts which would be exempted from a strike
surcharge, although that would have been pretty foolish on the part of the carriers.

The other thing I would point out...notice how all these charges are "per container", which is
standard in the industry, EXCEPT for the ILA charges.   (see my previous post)
Idiots.