Wednesday, Sep 28, 2016
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Economy

Dockworkers threaten strike; retailers worry

Longshoremen-Contract-STRIKE

The longshoremen's union may strike if they are unable to reach an agreement on their contract, which expires Saturday, and would bring commerce to a near halt at ports from Boston to Houston.

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The East Coast longshoremen are flexing their muscles again, threatening a dockworkers’ strike Sunday that would shut seaports from Massachusetts to Texas.

It would be the first coastwide strike since a two-month walkout in 1977 paralyzed the flow of tens of billions of dollars of imports — and the nation’s retailers and other businesses fear a painful replay if the 14,500 dockworkers, represented by the International Longshoremen’s Association, make good on their threats.

“Unless something miraculous happens, I think we’re looking at a strike,” said Kevin M. Burke, president of the American Apparel and Footwear Association, which represents an industry that imports $72 billion of goods each year through the ports facing a possible shutdown. “Our companies are preparing for the worst,” he said, “but hoping for the best.”

The strike threat has so alarmed corporate America that more than 100 business groups wrote to President Obama last week to urge him to push the two sides to settle — and, if need be, to invoke his emergency powers under the 1947 Taft-Hartley Act to bar a strike. President George W. Bush invoked the act in 2002 to end a lockout at ports on the West Coast, where a different union represents dockworkers.

Despite their small numbers, the East Coast dockworkers have outsize influence. Many, such as the crane operators who transfer containers from ships to the docks, are highly skilled and cannot be easily replaced. And because they control the loading and unloading of goods in most of the nation’s ports, a strike could cause extensive economic damage.

“They’re in a crucial place in the flow of goods,” said Richard W. Hurd, an industrial relations professor at Cornell University.

The contract negotiations, which have continued fitfully for nine months, broke off Dec. 18.

The two sides are deadlocked over one point in particular. The United States Maritime Alliance, an association of shipping companies and terminal owners, is demanding concessions on “container royalty payments,” which the companies share with union members for each ton of cargo handled. The companies want to freeze those payments for current longshoremen and eliminate them for future hires.

The maritime alliance says it paid $211 million in container royalties to the longshoremen last year, averaging $15,500 per eligible worker.

The alliance says that, including royalties, the longshoremen are paid $124,000 a year on average in wages and benefits. Union officials say those figures are misleading and put average annual wages at $75,000 before benefits.

The container payments were created in the 1960s to compensate the longshoremen as ports embraced automation and standardized, 40-foot-long containers to ship goods. That caused a big decrease in jobs and working hours.

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