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Aug.21, 2017

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INTERNATIONAL MARITIME 18 THE JOURNAL OF COMMERCE AUGUST 21.2017 The West Coast's share of Asian imports fell to 66.8 percent in 2016 from 78.4 percent in 2005, according to PIERS, a sister prod- uct of The Journal of Commerce within IHS Markit. The trend continued in the first half of this year, when the West Coast's share of Asian imports slipped to 65.7 percent from 67.2 percent in the first half of 2016. Combined East and Gulf coast import volumes from Asia during the first half of 2017 rose 9.2 percent year over year to 2.5 million TEU, compared with a 1.9 per- cent increase in West Coast volume. The ILA hasn't had a coastwide work stoppage since 1977, but came close during its 2012-2013 negotiations, which were settled after two extensions, repeated strike threats, and crucial help from federal mediators. Things have been quiet on the ILA bar- gaining front since last spring, when the union held informal pre-negotiation meet- ings with USMX officials to allow local officials to sound off about contract proposals. Several union and management officials told The Journal of Commerce that they have been waiting to see how events played out on the West Coast before plunging into coast- wide bargaining on the East and Gulf coasts. In early 2015, it appeared the ILA and USMX might reach a deal on a new or extended contract before their West Coast counterparts. After agreeing to explore early negotiations, ILA and USMX officials discussed the possibility of a multiyear extension to 2025. However, momentum for a long-term agreement stalled amid questions surround- ing medical costs, automation, jurisdiction, and other issues. More recently, the two sides have spoken in terms of a more traditional con- tract length of perhaps three years. The ILA's bargaining process is more complex than that of the ILWU. The West Coast encompasses fewer ports and has a single coastwide contract. The ILA and USMX have a Maine-to-Texas master con- tract, and supplementary local and regional contracts covering their more diverse ports. The master contract defines the scope of work and includes container and roll- on, roll-off cargo wages; medical benefits; carrier-paid container royalties; and other coastwide issues. Local contracts cover pen- sions, work rules, and other port-specific issues. Wages for breakbulk and bulk cargo handling also are negotiated locally, and vary within and among ports. Traditionally, the master contract has been negotiated before local agreements. This time, however, ILA President Harold Daggett has insisted that local bargaining be conducted first, in order to preserve union leverage in local bargaining. The change resulted from a Baltimore arbitrator's 2013 ruling that after the master contract takes effect, its no-strike clause can't be nullified by a dispute over local issues. Local negotiations are reported to be progressing in most ports, but they've been slow to develop in the Port of New York and New Jersey. The East Coast's largest port was at the center of the 2012-2013 negotia- tions, when ocean carriers in USMX refused to sign off on a master agreement until they had secured promises of productivity improvements in New York-New Jersey's local agreement. Some of the New York-New Jersey issues that were part of the last negotiations will carry over into the next round of talks. The ILA and the New York Shipping Associa- tion (NYSA) still haven't implemented the current contract's promised "relief gangs," or second shifts, that would replace the cur- rent system of open-ended shifts requiring excess staffing and extensive overtime. ILA hiring in New York-New Jersey is overseen by the Waterfront Commission of New York Harbor, a crime watchdog agency that the union and employers have accused of micromanagement. The commission says it is fulfilling its mission to fight organized crime and ensure fair hiring. Last spring, a brief kerfuffle ensued after several ILA officials proposed a one-day coastwide work stoppage and Washington march to protest "government interfer- ence" by the Waterfront Commission and by state-owned South Atlantic ports that employ non-union state workers for some terminal jobs. The proposed work stoppage was called off after Daggett urged dockworkers to heed their contract's no-strike clause and stay on the job while ILA leaders continue to press the union's claims to jurisdiction at ports. Daggett has said that automation is likely to be the top issue in the next master contract negotiations. Although few East and Gulf coast container terminals have the volume needed to justify full automation, several have implemented automated gates controlled by ILA clerks working in office- like settings instead of in truck lanes. The ILA-USMX master contract allows employ- ers to introduce automation on six months' notice, but permits the union to negotiate the impact on jobs. Other issues are expected to include jurisdiction over chassis maintenance and repair, and monetary issues including con- tainer royalties, the per-ton fees paid by carriers to support benefit programs, and annual payouts to dockworkers. At last spring's pre-negotiation meetings, union officials in several ports floated the idea of diverting a share of royalties to a fund that would shore up their ports' underfunded pensions. JOC Contact Joseph Bonney at and follow him on Twitter: @JosephBonney. Daggett has said that automation is likely to be the top issue in the next master contract negotiations.

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