Arbitration Stalls West Coast ILWU/PMA Contract Negotiations

While vessels idle offshore waiting to deliver commerce to U.S. West Coast ports, all eyes are on the contract battle between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA).  On Wednesday, February 4, 2015, James McKenna, PMA’s President and CEO, released details of a comprehensive offer in an attempt to end negotiations and the congestion building up on U.S. West Coast docks.

The details, released in a teleconference to the international trade media, laid out major concessions by employers that includes payment of all dockworker’s medical costs of the Cadillac tax under Obama’s Affordable Health Care Act, increases in pension payments to $88,800 a year, and complete maintenance and repair jurisdiction over chassis within the ports.

With an offer on the table, a new and controversial demand has taken center stage:  the power for PMA or ILWU to unilaterally remove arbitrators.  The media has reported this issue has been placed at the forefront based on internal union politics and stems from a local Southern California issue.  The PMA fears this would give unions the ability to fire arbitrators who do not decide in their favor and cause minor disputes to escalate to the degree we are experiencing on the West Coast today.

The shipping community now tensely waits to see if the PMA will lock out employees and force a federal injunction through the Taft-Hartley Act, forcing an 80-day cooling off period.  In 2002, President Bush enacted the Taft Hartley Act after an employer lockout that shut down ports for 10 days.

We will continue to closely monitor the situation and advise you of any important updates.