The Journal of Commerce Online - News Story

Joseph Bonney | Sep 3, 2009

Union rejection of a contract extension for Atlantic and Gulf dockworkers probably means talks on a new contract won’t resume until next year – and when they do, management’s position on technology will be unchanged, the employers’ chief negotiator said.

James Capo, chairman and CEO of United States Maritime Alliance, said he was disappointed by rejection of what management considered a “fair and very generous offer.” But he said employers won’t yield to ILA demands to halt the introduction of labor-saving technology at ports. “Our members are adamant that they are not going to allow the ILA to basically veto technology. If that happens, we’re all dead,” Capo said. “We cannot and will not agree to that position, ever.”

The ILA demanded a freeze on introduction of new technology during the contract extension. The ILA’s executive vice president, Harold Daggett, who plans to seek the union presidency in 2011, was especially vocal on the issue, saying he wanted to prevent the spread of automated terminals like the one APM Terminals opened two years ago in Hampton Roads.

Disagreements over technology overshadowed the discussion of wages at this week’s contract talks in Orlando. Management’s proposal would have boosted new workers’ pay and narrowed the gap between wage tiers. The changes would have been funded by delaying a raise scheduled for Oct. 1 under the existing contract, shifting funds from carrier-financed royalty programs that have surpluses, and increasing carriers’ contributions to the funds.

The offer would have immediately boosted new hires’ $16 hourly wage to $20. Next month’s scheduled pay raise would have been pushed back to 2012 for top-scale workers, boosting their pay from $31 an hour to $32. Additional changes would have narrowed the gap between wage tiers that are based on workers’ experience.

Under USMX’s proposal, dockworkers’ top straight-time pay would rise from $31 an hour to $32 in 2012. At the same time, hourly pay would rise from $20 to $23 for workers with three years of experience; $22 to $27 with five years; $24 to $30 with seven years and $28 to $32 with 11 years.

The increases for lower-tier workers would represent 25 to 100 percent of the difference between their current wages and top-scale pay – a schedule USMX said would continue in subsequent contracts. Reducing the gap between wage tiers and allowing lower-tiered workers to graduate to top pay were top ILA demands. However, union critics objected to delaying next month’s pay raise and to shifting money from carrier-paid funds that support programs such as the coastwide medical plan, which has accumulated a substantial balance since eligibility rules for benefits were tightened five years ago.

Capo said management structured its contract extension proposal to address the ILA’s economic concerns and minimize costs to container carriers that are losing billions of dollars a year while buying time to allow economic conditions to settle. “We thought it was a fair and generous offer given the times we’re in,” he said.