ILA Dockworkers Approve Contract

Joseph Bonney, Senior Editor Journal of Commerce Apr 09, 2013 9:00PM EDT

International Longshoremen’s Association members overwhelmingly ratified a six-year contract for East and Gulf coast dockworkers in a coastwide referendum Tuesday.

The ILA’s unofficial tally showed the contract won an 88 percent “yes” vote, with 7,192 in favor, 932 opposed, and 33 voided ballots. The union said all locals approved the contract, the first time in modern ILA history that has happened.

ILA President Harold Daggett and other union officials had campaigned hard for approval of the contract, which negotiators agreed on last month after a year of often-strained bargaining.

“On behalf of ILA members and officers at all ports, we’re thrilled this master contract was ratified by an overwhelming margin,” Daggett said. “We all worked very hard, achieved landmark improvements and protected our members and our union for many years.

An unofficial tally showed that ILA members in the Port of New York and New Jersey approved the coastwide master contract by more than 4-to-1 and a supplemental local agreement by more than 3-to-1.

Other ports also reported lopsided majorities for ratification. Locals in the ILA’s South Atlantic and Gulf district voted nearly 95 percent in favor of the coastwide pact. The contract was approved by healthy margins at every port from Boston to Houston.

Assuming ratification by management’s United States Maritime Alliance next Tuesday, the union vote closes a year of stormy, on-and-off bargaining highlighted by threats of the ILA’s first coastwide strike since 1977.

ILA and USMX negotiators tentatively agreed on the coastwide contract March 13 following a crucial deal on a supplemental agreement that revised decades-old work rules and pay practices at the Port of New York and New Jersey.

“We’re obviously pleased that ILA members voted to ratify the master contract,” said David F. Adam, USMX’s new chairman and CEO. “It’s in the best interest of both sides, our customers and the country that the ports continue to operate without disruption and that’s precisely what this agreement will do for the next six years.”

Negotiations on the coastwide contract were overshadowed by the contentious bargaining on the local contract for New York-New Jersey.

New York Shipping Association President Joseph Curto said the ratification vote clears the way for changes that will make the port more competitive. “This contract permits us to begin an evolutionary progression of significant change that will improve the practices for working ships, hiring labor and paying key staff persons … We very much look forward to working with ILA President Harold Daggett and his team in implementing these far-reaching and positive contract provisions,” Curto said in a statement.

ILA members on the East and Gulf coasts voted separately Tuesday on the coastwide contract and on local contracts covering their ports. About 14,500 members were eligible to vote.

Bargaining remains incomplete on local contracts at Hampton Roads, Baltimore, Philadelphia, Charleston, Mobile and New Orleans. ILA members in those ports voted Tuesday on the master contract, and will vote on their local contracts after negotiators reach deals in their ports. The ILA said remaining local contracts are expected to be completed within the next few days. It isn’t unusual for negotiations on local contracts to continue after a master-contract vote.

The ILA and employers opened negotiations on the coastwide master contract opened in March 2012.

After negotiations broke down last August, the Federal Mediation and Conciliation Service joined the talks and brokered two short-term extensions that averted threatened strikes in September and December.

The master contract raises the ILA’s $32 hourly pay for containerized and roll-on, roll-off cargo to $35 in three steps, and allows new workers to advance to top scale in six years instead of the previous nine. Employers will pay an additional $1 an hour toward local pensions.

Carriers’ annual per-ton container royalties, which support year-end payouts to ILA members, will be fixed at their 2011 level of $211 million a year, plus up to $14 million for administration. Royalties in excess of $225 million will be divided between the ILA and USMX.

The new master contract tightens ILA jurisdiction over chassis repair in port areas, protects ILA members displaced by new technology, and strengthens enforcement of overall union jurisdiction. ILA medical benefits, which carry no premiums and minimal co-payments, will not change.

The New York-New Jersey local contract sets productivity goals, replaces open-ended staffing schedules with regular work shifts, reduces gang sizes, and paves the way for elimination of no-show and low-show jobs. It also creates early-retirement incentives for older workers and recruiting, hiring and training programs for new hires.

The threat of a port shutdown forced shippers to pad stockpiles, divert cargo and implement other costly contingency measures.

Jonathan Gold, vice president of the National Retail Federation, said the contract approval “is welcomed news to the nation’s retailers, who have been on pins-and-needles for the past year due to the possibility of a supply chain disruption along the 14 East and Gulf Coast container ports.

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ILA, USMX Near Finish Line

Joseph Bonney,  Sr. Editor Journal of Commerce  Mar 28, 2013 11:22AM EDT

International Longshoremen’s Association members will vote April 9 on a landmark contract that was starting to look impossible without a strike.

Months of stormy negotiations that twice brought East and Gulf Coast ports to the brink of a strike yielded a six-year agreement on March 13 — by coincidence, just as white smoke poured from a Vatican chimney to herald the election of a new pope.

Final agreement by the ILA and United States Maritime Alliance didn’t come easily. Some of USMX’s carrier members made an unsuccessful last-minute appeal for additional concessions. ILA officials said those changes would have been a deal-breaker and probably would have triggered the union’s first coastwide strike since 1977.

“We were able to avoid a crippling strike that would have done severe economic damage,” USMX Chairman and CEO James Capo said. “At the end of the day, what counts is that we got it done and that both sides think it is a reasonable contract. I think it was fair for both sides.”

ILA President Harold Daggett said union delegates “achieved a great contract for the rank-and-file members we represent. Our union worked hard for over a year to bring home a landmark agreement that I am sure our members will ratify.”

For cargo interests, the new contract has been a long time coming. Repeated negotiating breakdowns and strike threats forced shippers to pad inventories, divert shipments and implement other costly contingency plans.

Throughout the negotiations, attention focused on the high-cost Port of New York and New Jersey. Neither the union nor employers were willing to sign off on a coastwide contract without a deal on the supplemental local contract covering work rules and other issues specific to the port.

Failure to reach a deal for New York-New Jersey likely would have triggered a coastwide strike. ILA officials in other ports said they were prepared to give their support, albeit grudgingly, to a walkout in support of the union’s demands at the East Coast’s largest port.

A showdown was averted when the ILA and the New York Shipping Association reached tentative agreement on the New York-New Jersey local contract on Feb. 7. They worked out final details the following week, clearing the way for negotiators’ final acceptance of the ILA-USMX master contract.

The complex interplay of local and coastwide contracts, set against a volatile economy and uncertain industry outlook, made these negotiations unique and unpredictable. “It was like riding a roller coaster in the dark,” NYSA President Joseph Curto said.

Everyone knew it was going to be a wild ride when Daggett arrived in Tampa in a black Bentley sedan for the March 28, 2012, kickoff of negotiations.

Daggett took office in July 2011, pledging a fiercely aggressive stance in the following year’s contract bargaining. He underscored that message the following March at The Journal of Commerce’s TPM Conference, when he bluntly warned that a strike was possible.

Carriers in USMX and the NYSA also signaled that bargaining wouldn’t be business as usual. Employer negotiators had unaccustomed support from European and Asian carriers’ home offices that traditionally stayed aloof from U.S. longshore bargaining. Some container lines made it clear they were willing to endure a strike if necessary to lower costs and improve productivity.

Ship lines were determined to limit their open-ended costs of per-ton container royalties that support annual payouts to ILA members under the coastwide master contract. Since caps on royalty payments were lifted in 2009, carriers’ royalty costs have jumped by some $180 million. ILA members’ payouts averaged $15,500 in 2011.

Carriers also pushed for changes in costly New York-New Jersey local contract provisions that require high levels of relief staffing, allow workers to be paid round-the-clock even if they’re on hours-long breaks, and encourage no-show and “low-show” jobs.

The new local contract replaces New York-New Jersey’s open-ended work schedules with regular and relief shifts capped at 16 hours each, and trims staffing requirements. The contract sets out a plan for hiring new workers, and for phasing out no-show and low-show jobs. Older workers will have a 60-day window to accept enhanced pension benefits and a $150,000 early-retirement incentive.

For the first time, the local contract sets productivity standards — 30 moves per gang-hour, rising to 35 moves per hour by the end of the six-year contract. Daggett said he’s confident ILA workers can achieve those standards and attract more cargo to the port.

For several weeks in November and December, master contract negotiations were deadlocked over container royalties. A compromise eventually fixed carriers’ annual royalties at their 2011 level of $211 million, plus up to $14 million a year for administrative expenses, and let the ILA and carriers divide any royalties exceeding $225 million.

The master contract also provides $1-an-hour wage increases in 2014, 2016 and 2017 in the ILA’s current $32 hourly straight-time pay for containers and roll-on, roll-off cargo. Starting pay will remain $20 an hour, but new hires will advance to top scale in six years instead of the previous nine.

The coastwide agreement also protects workers displaced by new technology, and ensures ILA jurisdiction over chassis maintenance and repairs in port areas. USMX did not seek changes in ILA medical benefits, which feature minimal co-payments and no premiums and are among the best of any union.

Carriers will pay an additional $1 an hour for ILA pension funds, which are badly underfunded in some ports. Ken Riley, president of Local 1422 in Charleston, said the added contribution is inadequate and may need to be revisited during the contract’s term. But Riley said he would support the contract’s ratification.

The new master contract extends carrier funding, though at decreasing levels, to subsidize the cost of ILA labor at union-staffed container freight stations. Employers failed to win reductions in minimum shift hours or lashing-gang sizes at South Atlantic ports, but local issues in those ports were considered secondary to the ones in New York-New Jersey.

Some of the large carriers in USMX were dissatisfied with the final deal, saying the master contract didn’t produce the cost cuts they were seeking, and that savings from improved productivity in New York-New Jersey and other ports would be hard to quantify.

On the union side, some rank-and-file discontent is apparent in New York-New Jersey, where workers question whether a $3-an-hour local pay differential in the new contract will offset their reduced work hours with the change to the new shift system.

Local talks continued last week at Philadelphia, Baltimore and Virginia.

Daggett has sent a letter to members urging ratification, and other ILA officials are working to sell the deal to members. About 14,500 ILA members are eligible to vote on the new contract, including 3,250 in New York-New Jersey.

The contract represents a hard-fought compromise that seemed out of reach at several points during the last year. The negotiations were punctuated by public bickering, walkouts by both negotiating teams, and meetings that seemed to go in circles while accomplishing little.

The low point in negotiations may have come in August, when a scheduled three-day bargaining session in Delray Beach, Fla., collapsed almost as soon as it began after a meeting the previous night made it clear no progress would be made.

“We had a lot of canceled reservations,” said Capo, who was scheduled to retire at the end of last year but stayed on to finish the negotiations. “We’d reserve a hotel for four days of meetings and be gone in two.” He said the up-and-down trajectory of the bargaining was unlike anything he’d experienced in his 47-year career.

Things didn’t level out until the Federal Mediation and Conciliation Service joined the talks in early September, when negotiations were dead in the water. The FMCS brokered two extensions past the contract’s original Sept. 30 contract expiration, averting threatened strikes both times.

Participants on both sides praised FMCS Director George H. Cohen and his team of mediators for dealing with the personalities and keeping the negotiations moving toward an agreement. “I don’t know that we’d have gotten this done without them. I really don’t,” Capo said. “Ultimately, it always comes down to management and labor to get the deal done, but the FMCS was very helpful in keeping us at the table and keeping us focused.”

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A Contract Creates Shifts for NY-NJ

Joseph Bonney, Senior Editor Journal of Commerce Mar 14, 2013 2:14PM EDT

The Port of New York and New Jersey’s unique “continuous operation” system will be replaced by work shifts similar to those of other U.S. ports under the new International Longshoremen’s Association local contract.

The contract negotiated by the ILA and the New York Shipping Association calls for regular work gangs and relief gangs that would work in shifts. They would replace the current arrangement, where the same groups of workers stay on the job until a ship is loaded and discharged.

It’s a milestone change that NYSA President Joseph Curto said “will allow us to begin an evolutionary progression of meaningful change that will improve the process for working ships, hiring labor, and paying key staff persons.”

The contract provides a 60-day window for experienced workers to apply for sweetened pension benefits and a $150,000 severance inducement. Curto said about 400 workers with 25 years’ seniority would be eligible.

The NYSA and ILA also plan a new recruiting, hiring and training program to replace those workers taking early retirement.

The new work system is expected to be phased in beginning Oct.1, 2014, so that there’s time to hire and train new workers to replace the early retirees.

New York-New Jersey’s work rules and staffing practices are part of a local agreement that supplements the coastwide master contract between the union and United States Maritime Alliance, the umbrella organization for East and Gulf Coast employers.

The New York-New Jersey issues were the primary obstacle to negotiation of the coastwide agreement that the ILA and USMX agreed upon Thursday. ILA members are scheduled to vote on the contract April 9.

Curto said the NYSA began laying groundwork for changes in the port’s work practices about three years ago. Many of those practices predate the advent of containerization more than a half century ago.

“We know that we can’t undo 50 or 60 years of history overnight, but we believe this agreement allows us to start the process,” he said in an interview. “We believe that the continuous operation system has prevented us from achieving the

New York-New Jersey’s existing work practices have been criticized for requiring additional staffing to avoid interruptions while workers are taking — and being paid for — breaks of up to several hours.

Existing work rules require ship gangs of a foreman, three crane operators and six longshoremen, in addition to several terminal-based drivers and checkers. The new contract calls for regular and relief gangs that each will have one less longshoreman, along with reduced relief staffing on the terminal.

Curto said having shifts should improve safety, because workers won’t be on the clock for 24 hours or more at a time. He said the reduction in cost is expected to allow the port to lower its cargo assessments, currently $100 per full container moving within 260 miles of the port, by about $6.

NYSA Executive Vice President John Nardi, a former Hapag-Lloyd executive, will become NYSA president after Curto’s scheduled retirement this year. Nardi said the new contract recognizes New York-New Jersey’s need to compete for inland cargo that other ports also can handle.

“We’ve been operating on a port-to-port system, but cargo moves under a point-to-point system,” he said. “If we can’t think point-to-point, we can’t be competitive.”

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ILA Releases Contract Details

JOC Staff | Feb 13, 2013 9:34AM EST

The tentative coastwide master contract for International Longshoremen’s Association members includes pay raises, a compromise on carrier-paid container royalties, and continued free medical coverage for ILA members.

The ILA released details of the agreement as union officials began holding local meetings along the East and Gulf coasts to explain the six-year contract to members. The ILA’s 200-member wage scale committee will meet March 12-14 to vote on whether to recommend it for rank-and-file ratification.

The tentative coastwide agreement, reached Feb. 1 with United States Maritime Alliance, will not take effect until bargaining is concluded on supplemental local contracts covering work rules, pensions and other port-specific issues.

Several local contracts have been completed, but the crucial one for the Port of New York and New Jersey remains unsettled. The New York Shipping Association, a USMX member, is seeking work-rule changes to bring costs closer to those of competing ports.

The ILA-USMX master contract provides $1-an-hour raises in the contract’s second, fourth and sixth years. Starting pay remains $20 an hour, but the contract allows new hires to advance to top scale, currently $32 an hour, in six years instead of the previous nine.

A key sticking point in the negotiations was container royalties, a program established in the 1960s to compensate workers for the loss of jobs to automation. Carriers’ royalty payments are based on cargo weight, and support annual payouts to workers.

The ILA and USMX agreed to guarantee annual royalty payments at the $211 million level of 2011, and to divide royalties over that level.

That represented a compromise between USMX, which had sought to cap royalty payments and phase them out over 25 years, the ILA, which opposed any caps or other changes.

Other contract provisions include continued free medical coverage to workers, which USMX had not sought to change, and new language to protect workers displaced by automation and preserve ILA jurisdiction over container repairs and other work.

The contract provides an additional $1-an-hour contribution by employers for local fringe benefits, including pension plans that are underfunded in several ports.

The master contract says workers in New York-New Jersey will be randomly drug tested only if the Waterfront Commission of New York Harbor agrees to stop testing ILA members.

ILA to meet in March to consider tentative master contract

American Shipper On-Line Monday, February 11, 2013

The International Longshoremen’s Association said its Wage Scale Committee, a group of about 200 union delegates, will meet in Tampa, Fla., on March 12-14

The committee is the group that decides whether or not to recommend to union members to approve the union’s master contract with employers.

On Feb. 1, the union and employers, represented by the U.S. Maritime Alliance (USMX), reached a tentative agreement on a six-year master contract.

The deal is subject to both ratification and agreements being reached in a number of local union negotiations

The New York Shipping Association said its goal was to complete local negotiations by March 1.

According to a notice posted on the ILA’s Facebook page, Local 1804-1 in New York is planning to hold a meeting on Wednesday to review the master contract tentative deal. Other New York/New Jersey union locals will also meet this week.

Harold Daggett, president of the ILA, was formerly the president of Local 1804-1 and the local which represents maintenance workers that’s now headed by his son, Dennis, who is also president of the ILA’s Atlantic Coast District. – Chris Dupin

ILA strike averted; bargaining now focused on local issues

Monday, February 04, 2013 American Shipper

The International Longshoremen’s Association and U.S. Maritime Alliance reached a tentative agreement for a new six-year master contract late last Friday, avoiding the possibility of a strike later this week, but negotiations over local issues continue.

George H. Cohen, director of the U.S. Federal Mediation and Conciliation Service, which has been assisting the two sides in contract talks, said “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.”

Cohen added: “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.”

“I know ILA members will be satisfied with the results of our negotiating efforts thus far,” said ILA President Harold J. Daggett. “We turn our full attention now to achieving equally successful local contract agreements, and we look forward to our members expressing their voice in the ratification process of the full contract package.”

In a statement released by the union on Sunday, Daggett said “although the two sides cannot release complete details of this still unfinished contract, I can assure my membership that the protections for our jurisdiction and increased benefits and wages were achieved. We have come away from these master contract negotiations with landmark agreements on automation, protection of chassis work and powerful jurisdiction language.”

“ILA will continue to work while local negotiations are taking place,” said James Capo, the chairman and chief executive officer of the U.S. Maritime Alliance.

Jim McNamara, a spokesman for the union, said once local agreements are reached at all ports, the 200-plus ILA wage scale delegates will meet to recommend ratification to the full ILA membership

McNamara said no deadline for those local negotiations has been announced.

Joseph Curto, president of the New York Shipping Association, which negotiates on behalf of employers in the Port of New York and New Jersey, said the local bargaining is ongoing and the goal is to have local bargaining complete by March 1.

The deal reached Friday prevents a work stoppage that loomed this week. The current contract between the ILA and its employers, represented by USMX, was originally due to expire Sept. 30, but was twice extended, first to late December, and then to Feb. 6. With the deal reached on Friday, ships will continue to work.

Some steamship lines, terminals, and railroads, which had been warning customers that they would refuse to accept cargo because of the possibility of a strike, were expected to undo those restrictions.

The ILA-USMX master contract covers more than 14,500 ILA members who handle containerized cargoes in 14 U.S. East and Gulf coast ports.

Shippers expressed some relief with the progress of the talks, but want the ILA and USMX to press forward.

The talks with the New York Shipping Association are seen as particularly important. Shipping and terminal executives say there is a need to reform work rules to make cargo handling at New York and New Jersey terminals more competitive with that at other ports.

“We urge the parties to quickly complete any outstanding negotiations, including local negotiations at each of the individual 14 ports, and quickly ratify the new labor agreement,” said National Retail Federation President and Chief Executive Officer Matthew Shay in a statement Saturday morning

“If the tentative agreement holds, the new labor contract will bring much-needed certainty and predictability to the supply chain for retailers, manufacturers, farmers and other industries that rely on the ports to move the nation’s commerce and trade,” he added

Chris Dupin

FMCS Statement Release Date: 2/1/2013

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 invaluable assistance both to me and the parties throughout this lengthy process.”

ILA, USMX Move Closer to Deal

Joseph Bonney, Senior Editor Journal of Commerce | Feb 01, 2013 11:16AM EST

UPDATED Feb. 1, 2:15 p.m. —

The International Longshoremen’s Association and United States Maritime Alliance appear to be moving closer to an agreement that would keep East and Gulf Coast ports open after the current dockworker contract expires at midnight Wednesday.

Negotiators met into the night Thursday and reportedly exchanged contract proposals that were to be discussed today. Details weren’t available, but sources in the talks reported progress toward a deal.

Those sources cautioned that negotiators may not have time to agree on all issues before Wednesday.  But they added that if the two sides can come close to a deal, the union could keep working past Wednesday while final details are smoothed out.

Neither the union nor employers are enthusiastic about a third extension of their contract, originally set to expire last Sept. 30. The latest contract extension last month averted a threatened Dec. 30 strike.

Negotiators had reserved rooms and meeting space for three days this week at a hotel near the Newark, N.J., airport. Today they moved to a different hotel nearby to continue their meetings.

The Federal Mediation and Conciliation Service is overseeing the negotiations. The mediators became involved after negotiations broke down last August. The ILA and employers have engaged in on-and-off bargaining since last March.

The two sides are seeking a six-year contract.

The ILA hasn’t had a coastwide strike in 35 years, but this year’s negotiations have been unusually contentious.

A key issue has been work rules at the high-cost Port of New York and New Jersey.  Negotiators this week reportedly have made headway on those issues, which are in a supplemental local contract between the ILA and the New York Shipping Association.

While the negotiations continue, cargo interests, carriers and terminals are proceeding with contingency plans in case of a work stoppage.

Port Newark Container Terminal said that if there’s no contract deal, it will keep its gates open until 7 p.m. on Monday and Tuesday for import pickups. PNCT, Global Container Terminal and New York Container Terminal have said they will not accept refrigerated boxes after Wednesday.

The Port of Virginia also issued its updated contingency plan for a potential strike.

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ILA Negotiations: Not Over Yet

Joseph Bonney, Senior Editor | Jan 29, 2013 11:21AM EST

What’s remarkable about the latest twists in the longshore labor negotiations for East and Gulf Coast ports is the muted reaction from shippers.

Maybe shippers are simply weary of being whipsawed by five months of contract expirations and strike deadlines since last September. Maybe they’ve decided they’re ready with contingency plans and that the pressure on their supply chains is diminished by the mid-winter slack season.

Surprisingly, some shippers we’ve heard from seem to be operating on the assumption that after the ILA and employers agreed on container royalties and a second contract extension in late December, a final contract was only a formality.

If they thought that, they’re mistaken. With less than nine days before the latest contract extension expires at 11:59 p.m. next Wednesday, these negotiations still have far to go.

Container royalties overshadowed everything else for several weeks last month. However, as we’ve said for months, the toughest issues in these negotiations are work rules and staffing levels in the supplemental local contract for the Port of New York and New Jersey.

Last week’s meetings between the ILA and the New York Shipping Association reportedly produced little headway on those issues. NYSA members are holding firm on their demand to change “archaic” work practices, some in place for decades, that require high levels of staffing and that pay workers when they’re not on the job. ILA President Harold Daggett has refused to budge on the work rules.

The standoff in New York-New Jersey has blocked agreement on the Maine-to-Texas master contract between the ILA and United States Maritime Alliance. The union and employers have been unwilling to sign off on a coastwide deal as long as the dispute in New York-New Jersey remains unsettled. Bargainers in other ports are marking time on their local negotiations until they see what happens in New York.

Daggett is determined to deliver a favorable contract in his first tour as the union’s chief negotiator. His strategy in negotiations seems to be to wait for management to yield to the union’s demands. Exasperated employers say the union has been bullheaded and unwilling to engage in give and take.

Usually by this point in ILA negotiations, container ship lines have grown anxious for a deal that avoids a strike, even if terms aren’t favorable. This time has been different. Even before bargaining began last spring, employers said they planned to take a tough line on costs and productivity. For the most part, they’ve stuck to that plan.

That brings us to this week’s renewal of federal mediated negotiations between the ILA and USMX. These bargaining sessions will be crucial in determining whether East and Gulf Coast ports are hit next month by their first coastwide work stoppage in 35 years.

It’s widely expected that at some point, USMX will present the ILA with a final offer on a coastwide master contract. That could confront the union with a tough decision on whether to approve a lucrative agreement without a deal on work rules at the East Coast’s largest port.

ILA locals outside New York-New Jersey aren’t enthusiastic about striking to preserve staffing requirements and work rules that don’t apply in their own ports and that many local officials privately consider outlandish. But it seems unlikely that they’ll buck the union’s leadership by leaving New York-New Jersey high and dry.

That’s where things could get dicey. This week’s negotiations could play out in any of several ways. If bargaining stalls, the union could renew its threat to strike. Or fed-up employers could pressure the union by closing ports with a lockout, a step they considered last month. Or the two sides could announce yet another short-term extension, though there appears to be little enthusiasm for this option.

There’s one other possibility: With the federal mediator’s help, the two sides could decide they’ve had enough brinkmanship and that it’s time to work out a compromise that both can accept. That’s something shippers could get excited about.

We’ll know more soon.

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New York issues overhang longshore talks

Wednesday, January 30, 2013  American Shipper

The International Longshoremen’s Association (ILA) and U.S. Maritime Alliance (USMX) resumed contract negotiations on Tuesday, but sources say efforts to reform work rules and improve productivity in the Port of New York and New Jersey are likely to overhang national talks.

USMX is negotiating a master contract with the ILA for handling containerized cargo at 14 ports cargo on the East and Gulf coasts. The two sides are being assisted by the U.S. Federal Mediation and Conciliation Service. Originally scheduled to expire at the end of last September, the current contract has been extended twice: first in late September for 90 days, then in late December to Feb. 6, next Wednesday.

ILA spokesman Jim McNamara said late Tuesday the two sides were continuing to meet—both committees of about 20 members on both sides, as well as smaller subcommittees working on various issues such as jurisdiction. Talks were scheduled to continue on Wednesday and Thursday.

Carrier sources tell American Shipper that reaching agreement on local issues, particularly in the Port of New York and New Jersey, are key to the master contract.

There has been no movement yet on New York issues,” said one executive. “Meetings, obviously, are continuing. If there is no movement on New York, there would be no ability for a master contract.”

Carriers are cautioning shippers about the potential for a work stoppage.

For example, on Tuesday, OOCL posted a statement on its Website saying, “In the event that an agreement cannot be reached by February 6th and a work stoppage occurs, OOCL wants to assure you that we will do everything possible to minimize disruptions and keep you constantly informed about changes in vessel schedules, cargo location, and terminal status.”

Many carriers have filed with the U.S. Federal Maritime Commission planned surcharges of up to $1,000 per 40-foot container on cargo moving through U.S. and Canadian ports in the event of a strike.

The ILA met Monday afternoon with the New York Shipping Association, which negotiates local issues in the Port of New York and New Jersey, and another carrier source said there have been about 50 hours of face-to-face meetings since last October on New York issues with little progress

He said employers in New York would like to have ILA members work shifts rather than having the same gangs of men work a ship throughout its discharge and loading of cargo. He said current work practices leads to low productivity, and the need to hire large numbers of relief workers as the same crew remains with a ship, sometimes for 16 or 24 hours. In addition some union workers are paid the entire time a gang stays with a ship, even though they may be at home, even sleeping.

In other ports where longshoremen work in shifts, he said productivity is much higher. Management is also trying to eliminate positions that have been criticized as “low-show” and “no-show” jobs by groups such as the Waterfront Commission of New York harbor.

The carrier source complained that while management has been trying to move to resolution, the ILA “keeps on coming up with new demands.”

It may be strategy and now they are going to begin seriously negotiating—there is the give, but we don’t know if there is going to be any take.”105

If there is a strike, one carrier executive said he doubted carriers would try routing containers through Canadian or West Coast ports, predicting longshoremen in those ports “won’t touch them.”

Chris Dupin

ILA Walks Out of NY-NJ Talks

Journal of Commerce  Joseph Bonney, Senior Editor | Jan 09, 2013 1:37PM EST

International Longshoremen’s Association officials broke off two days of scheduled negotiations on a local contract for New York-New Jersey dockworkers after objecting to employers’ proposed changes.

Federally mediated negotiations are still scheduled next week on the coastwide master contract between the ILA and United States Maritime Alliance, the umbrella group representing employers in East and Gulf coast ports.

Bargaining between the ILA and the New York Shipping Association on the ILA-NYSA local contract opened Wednesday morning but ended abruptly after sharp disagreements over work practices and other issues.

Union President Harold Daggett and other ILA leaders walked out after the NYSA proposed “revolutionary changes” in work practices at the Port of New York and New Jersey, ILA spokesman James McNamara said.

The NYSA is seeking productivity improvements and changes to work rules, some of which predate containerization. Those work rules require high levels of staffing, including requirements that terminals hire gangs of 15 or 16 workers when only nine or 10 are working at a time.

This week’s bargaining sessions followed a short-term contract extension through Feb. 6. The extension, announced Dec. 28, averted a threatened ILA strike in East and Gulf coast ports during the weekend preceding New Year’s Day.

The ILA and USMX agreed to the extension after reaching tentative agreement on container royalties, the per-ton payments by carriers that support annual payouts to longshoremen.

The agreement on royalties cleared the way for bargaining on work rules and other issues in supplementary local contracts. The most difficult of those negotiations are expected to be in New York-New Jersey, where the ILA is headquartered and employers say costs are by far the highest of any port along the coast.

The rough start to the New York-New Jersey talks will raise concerns among cargo interests, which are watching the negotiations closely. Many shippers diverted cargo or adjusted booking schedules to avoid threatened shutdowns before the contract’s originally scheduled expiration Sept. 30 and again last month.

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With tentative container royalty deal, ILA-USMX turn to NY issues

American Shipper Wednesday, January 02, 2013

The International Longshoremen’s Association (ILA) and U.S. Maritime Alliance (USMX) agreed last week to continue contract negotiations through Feb. 6, averting a strike that would have begun on Dec. 30, but there are still difficult issues for the two sides to address in the weeks ahead, including work practices in the Port of New York and New Jersey.

“There is progress,” said one source, who asked not to be identified. “If you had asked me a couple of weeks ago, I would have said impossible.”

George H. Cohen, director of the U.S. Federal Mediation and Conciliation Service, said last Friday that “the container royalty payment issue has been agreed upon in principle by the parties, subject to achieving an overall collective bargaining agreement,” and that the two sides would “negotiate all remaining outstanding Master Agreement issues, including those relating to New York and New Jersey.”

Joseph C. Curto, president of the New York Shipping Association, said the meeting schedule has not yet been set, but talks are expected to begin sometime next week.

He noted the master contact talks are led by USMX, but added “many of the parties to the master contact and the New York local agreement are the same parties so that when bargaining actually begins there is an opportunity for parties to discuss both New York and master contract issues.”

It’s not clear what kind of deal the two sides have struck on royalties, which are payments above and beyond salaries to ILA members and the union based on the weight of containerized cargo that moves through the ports. Container royalties amounted to $211 million in 2011.

One source described the agreement as a “breakthrough,” but said there are still a number of details to work out. There was a sticky point and it seems that point we can now move beyond – but now there are other sticky points,” he said.

While USMX had proposed continuing royalties at 2011 levels to the ILA members who receive them today for another 25 years or until they retire,  A source said it was evident that proposal was “not going to fly” and that royalty payments would continue in some form.

Another source, who requested to speak on background, said there was some sort of agreement that would fix the level of payments.

One source thought ILA President Harold Daggett was tactically wise to emphasize the royalty issue because it built support among his membership in ports other than New York.

As the talks now move on to address work rules and practices in New York, the source suggested Daggett may find less sympathy from union members in other ports.

Work practices in the port were the focus of hearings of the Waterfront Commission of New York and New Jersey in 2010 and a report that was issued in March 2012.

The commission concluded in its report that “The current system by which the CBA (collective bargaining agreement) is structured and interpreted creates a significant number of prime positions on the waterfront that require little or no work and that command outsized salaries.”

Most sensationally, the Waterfront Commission charged “those positions are almost always filled with favored individuals – those who are connected to union leaders or organized crime figures.”

In recent years, the union has denounced the Waterfront Commission, an organization that was created in the 1950s to fight crime on the waterfront in New York and New Jersey. It licenses port workers, conducts investigations, and has its own police force. But Daggett has complained the organization continues to unfairly treat all ILA members like criminals and harasses union members.

Daggett’s cousin, attorney George T. Daggett, complained in 2011 that the commission is dedicated to “perpetuating the stigma of organized crime,” and said New York-New Jersey longshoremen live in a “police state”.

The ILA adopted a code of ethics in 2004, made it part of its constitution, and has appointed two ethical practices counsels to investigate allegations of organized crime influence.

As recently as 2007, a civil racketeering suit by the federal government against the union was dismissed.  While the Waterfront Commission is not involved in the labor talks, its report was the subject of wide media attention, and will be in the background as contract talks continue this month

Walter Arsenault, executive director of the Waterfront Commission, said last year there are 285 longshoremen in the port who make more than $300,000 per year and several that make more the $400,000 per year. The commission said some ILA workers are paid round the clock while not even at the port.

Those work practices have also caught the attention of the Port Authority of New York and New Jersey, with Patrick Foye, executive director of the agency, saying he was unhappy with the “low-show” jobs as well as the level of minority hiring in the port.

Again, the Port Authority has no role in the negotiations, but Foye noted the agency has spent billions on infrastructure improvement to benefit the industry.

Chris Dupin

Friday, December 28, 2012

Statement by FMCS Director George H. Cohen On United States Maritime Alliance and International

Longshoremen’s Association Labor Negotiations


“I am extremely pleased to announce that the parties have reached the agreements set forth below as a result of a mediation session conducted by myself and my colleague Scot Beckenbaugh, Deputy Director for Mediation Services, on Thursday, Decembe 27, 2012:

“The container royalty payment issue has been agreed upon in principle by the parties, subject to achieving an overall collective bargaining agreement. The parties have further agreed to an additional extension of 30 days (i.e., until midnight, January 28, 2013) during which time the parties shall negotiate all remaining outstanding Master Agreement issues, including those relating to New York and New Jersey. The negotiation schedule shall be set by the FMCS after consultation with the parties.”

“Given that negotiations will be continuing and consistent with the Agency’s commitment of confidentiality to the parties, FMCS shall not disclose the substance of the container royalty payment agreement. What I can report is that the agreement on this important subject represents a major positive step toward achieving an overall collective bargaining agreement. While some significant issues remain in contention, I am cautiously optimistic that they can be resolved in the upcoming 30-day extension period.”

“On behalf of our Agency, I want to thank the parties, especially ILA President Harold Daggett and USMX Chairman & CEO James Capo, for their ongoing adherence to the collective bargaining process, which has enabled them to avoid the imminent deadline for a work stoppage that could have economically disruptive nationwide implications.”

ILA Prepares for Dec. 30 Strike

Joseph Bonney, Sr. Editor Journal of Commerce  Dec 20, 2012 11:12AM EST

With contract negotiations at an impasse, International Longshoremen’s Association President Harold Daggett has directed ILA locals to prepare for a Dec. 30 strike at East and Gulf Coast ports.

Daggett sent a letter to locals advising them that “negotiations are not progressing well and it is expected that there will be a coastwise strike beginning at 12:01 a.m. on Sunday, Dec. 30.”

The ILA and United States Maritime Alliance broke off negotiations Tuesday after failing to agree to extend the contract past its Dec. 29 expiration. The contract, originally set to expire Sept. 30, has already been extended once.

Daggett’s letter to ILA locals said that if the union strikes, it will not handle containerized cargo, but will handle unfrozen perishable commodities, containerized military cargo excluding household goods, containerized mail, passenger ships, and non-containerized cargo and automobiles.

The letter did not specify how the ILA would deal with containerized shipments of perishable cargoes. Many of those shipments move on ships of carriers that use ILA labor under local contracts but are not signatories to the ILA-USMX master contract.

Although the ILA has pledged to continue to handle containerized mail and military cargoes, many of those shipments are carried on ships of major container lines that are master-contract signatories and would be affected by a strike.

The letter’s to-do list also directed union locals to establish strike committees, secure ILA lawyers’ approval of picket-sign language, and avoid violence on picket lines.

The likelihood of the ILA’s first coastwide strike in 35 years increased after Tuesday’s failure by negotiators to agree on an extension.

Talks broke down after USMX rejected the ILA’s demand that an extension be accompanied by a promise to maintain the status quo on carrier-paid container royalties that provide annual payments to dockworkers.

Royalties have emerged as a top issue in negotiations. USMX has proposed to cap royalties at current levels, use the excess for other ILA benefits, and eliminate payments to new hires while guaranteeing them to current workers for 25 years.

The ILA objects to any change in royalties. The union views them as continuing compensation for jobs lost during the shift to containerization, and as an important source of income for workers and for the union.

Royalties were established in the 1960s. Last year they provided eligible workers with checks averaging $15,500, at a cost of $211 million to carriers. Since caps on royalty payments were lifted in 2009, carriers’ costs have risen by a total of $180 million.

Besides changes to royalties, employers want changes that would provide negotiators with more flexibility to change port-specific work rules and pay practices in local contracts. Many of those changes are aimed at the high-cost Port of New York and New Jersey, where employers are seeking to address staffing levels and other practices.

ILA  Authorizes Strike at Year-End

Joseph Bonney, Senior Editor Journal of Commerce Dec 10, 2012 12:34PM EST

International Longshoremen’s Association President Harold Daggett won authorization from ILA delegates to call a strike if a bargaining impasse isn’t settled before the union’s contract expires Dec. 29.

The vote by the ILA’s 200-member wage scale committee moves East and Gulf coast ports closer to their first coastwide strike in 35 years.

Daggett asked the ILA’s 200-member wage scale committee for strike authorization after he delivered a speech accusing United States Maritime Alliance of trying to reverse gains the ILA has made in previous contracts.

The roll call vote in favor of the strike authorization was unanimous, ILA spokesman James McNamara said.

Complete Coverage of ILA-USMX Negotiations

The vote preceded a session today in which employer representatives presented USMX’s proposals to wage scale committee members meeting in Delray Beach, Fla.

Daggett’s speech to ILA delegates reportedly emphasized USMX’s proposal to cap container royalty payments to workers. USMX has proposed capping payments at current levels, which averaged $15,500 per eligible worker last year, and using the excess to fund other ILA benefits.

An ILA strike would affect container and roll-on, roll-off cargo covered by the ILA-USMX coastwide master contract. The ILA would continue to work breakbulk cargo and cruise lines that employ ILA labor but are not covered by the master contract, McNamara said. Perishables and military cargo also would be exempt, he said.

In addition to issues in the coastwide master contract, this year’s negotiations over supplementary local contracts have been contentious, especially in the Port of New York and New Jersey, where the New York Shipping Association is seeking changes in work rules, including requirements for extensive relief staffing.

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NRF Urges Obama to Head Off ILA Strike

JOC Staff Dec 17, 2012 12:16PM EST

The National Retail Federation urged President Obama to “use all means necessary” to head off a threatened Maine-to-Texas container port strike by the International Longshoremen’s Association.

“We call upon you to use all means necessary, including Taft-Hartley, to keep the two sides at the negotiating table and head off a coast-wide strike,” the federation’s president and CEO, Matthew Shay, said in a letter to Obama.

The Taft-Hartley Act empowers the president to seek a court injunction triggering a back-to-work order halting strikes that threaten national health and safety. Taft-Hartley injunctions order the union back to work while negotiations continue under an 80-day cooling-off period.

The ILA and United States Maritime Association have been negotiating intermittently since March. Representatives of the ILA and USMX are scheduled to meet Tuesday to discuss one of the top issues, payments to dockworkers from container-funded container royalties.

ILA delegates last week ILA President Harold Daggett to call a strike if there’s no contract when a temporary extension ends Dec. 29.

Daggett said he’s prepared to cancel the strike threat if negotiators make headway on the royalty issue. That would clear the way for a second extension. The contract already has been extended for 90 days past its original Sept. 30 expiration.

The NRF letter said progress in negotiations has been slow and that the talks require “immediate intervention by the administration. Allowing a strike to occur for even one day could have a negative impact on all of those downstream businesses and employees who rely on the ports. The U.S. economy cannot afford to wait for a strike to occur before we see administration action. We urge you to get engaged now with these parties to ensure a strike does not occur.”

Montreal Prepares for Cargo Bump If ILA Strikes

Peter T. Leach, Senior Editor | Dec 14, 2012 10:18AM EST

The Port of Montreal is standing by to handle any cargo that would be diverted if the International Longshoremen’s Association strikes East and Gulf Coast ports at the end of the year.

“There is intention of handling whatever cargo comes this way” in the event of a strike, said Tony Boemi, the port’s vice president of growth and development. “By law, they (Montreal dockworkers) can’t not handle it.”

The ILA and employers represented by United States Maritime Alliance are racing the clock on negotiations for a new contract that expired on Sept. 30, but was extended to Dec. 29.

Although Montreal’s Maritime Employers Association is conducting its own negotiations with ILA locals 375 and 1657 for renewal of the contract that expires on Dec. 31, Boemi said the contract likely would be extended if they don’t reach agreement by year-end.

Negotiations, he said, “are going very well” and there is “absolutely no intention for any work stoppage.”

It’s common for the negotiations to continue beyond the expiration date. The last work stoppage in Montreal, which occurred in July 2010, came after the old contract had expired two years earlier. “In an absolute worst-case scenario, the earliest date there could be a strike is July 2013, so in the short term, there is absolutely no issue with Montreal,” Boemi said.

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