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Focus: Global Supply Chain and Logistics

Our Weekly Feature Article on Topics Related to Global SupplyChain Logistics

From SCDigest's On-Target e-Magazine

- Feb. 13, 2013 -


Global Logistics News: Update! Clerical Workers Union Surprisingly Rejects Contract, Potentially Leading to Another Strike at LA/Long Beach

Generous Offer Approved by Leadership Goes Down; "Spoiled Kids" Says Los Angeles Times; New Details of Rejected Contract Surface; Talks Said to be Occurring


SCDigest Editorial Staff

Updated Feb. 13, 10:30 AM ET


Since the announcement on Friday, there has been little additional news about the details for why the clerical workers union membership at the ports of Los Angeles and Long Beach rejected the contract terms that had been not only accepted but lauded by its union leadership, nor whether there are any plans for another strike that could again shut down the ports as a previous walk-out did for eight days in November.


Union leaders have not commented to the media nor made any statements on the Local 63 Office Clerical Unit web site as to what the members didn't like in the new deal.


There are a couple of reports simply saying that both sides have returned to negotiations and have agreed to limit public comments during those talks. Obviously, if those talks falter another strike could be seen.


Meanwhile, The Long Beach Post has been able to review the rejected contract, and called out these as important changes from the previous agreement, which had expired all the way back in 2010:

• A 30-day exemption to filling temporary positions under certain leaves of absence conditions

The ability to reduce 14 full-time positions through attrition

Language to confirm current practice that all work under the Office Clerical Unit jurisdiction remains with unit clerks

Job guarantees

A one-time $4,000 payment covering increases they would have had during the past 30 months

A $1 hourly increase upon ratification, with another $1 hourly boost in July

$150-per-month pension contributions per year of service that would increase to $170 by the end of the contract.


That last provision looks especially attractive, as the ports would say for a 10-year veteran be contributing $1700 a month for the worker's pension.


But not everyone thought the terms were so good, obviously, as the agreement was voted down by the rank and file. An under an article written on the World Socialist web site under the title "Los Angeles/Long Beach longshore clerks vote down sell-out contract,"the group said that given "that all 16 clerical units have now overwhelmingly rejected it is clear evidence of the both of the enormous gap that exists between the workers and the ILWU leaders, who confidently had predicted that the agreement would be approved, and of the workers’ lack of confidence in the ILWU."


Meanwhile, for the second time the same office clerical workers union has accused one terminal operator of listening in during calls between union members to gain an advantage in negotiations.


A charge was filed this week with the Los Angeles office of the National Labor Relations Board against APM Terminals.


APM "unilaterally activated an "Observe" feature of its in-house telephone system, whereby it could secretly electronically eavesdrop on confidential telephone conversations of bargaining unit employees discussing ... ongoing negotiations and bargaining strategy," wroteRalph M. Phillips, an attorney for the International Longshore and Warehouse Union's Local 63 Office Clerical Unit in the complaint.


There had been a similar charge in November, but the union didn't follow the right procedures and the NLBR was forced to drop the action. The union has just now then refiled the complaint.


Original Story


Shocking news this morning on the global logistics scene, as a new contract offered to the clerical workers union at the ports of Los Angeles and Long Beach approved by union leadership was surprisingly rejected by the full rank and file.

SCDigest Says:


Under an editorial titled "Spoiled Kids?", the normally union friendly Los Angeles Times asked "Are they for real?"

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The relatively small International Longshore and Warehouse Union Local 63 Office Clerical Unit, which had been working without a contract since June of 2010, finally went on strike in late November.

When that picket line was honored by dock workers, it shut down operations in 10 of the 14 terminals at the port complex for eight days, causing many ships to divert to other ports or await a resolution moored out in the Pacific Ocean. That caused supply chain disruptions to some companies and millions of dollars to the ports.


The key issue was related to perceived threats of outsourcing some of the work processing import and export-related documentation to outside services or maybe even offshore.


The union seemed to win that argument, as Steve Berry, lead negotiator for the Los Angeles and Long Beach Harbor Employers Assn. that represents the shipping lines and cargo terminals, said when an agreement was reached Dec. 4 that there will be "no outsourcing under this contract," and that in effect there will be a lifetime guarantee of a job at the port for all current clerical workers.


That after he had earlier noted that the deal the ports were offering included included "absolute job security," a raise that would take annual total compensation to $195,000 from $165,000, 11 weeks of paid vacation, and a generous pension increase. The current base wages are closer to $90,000. You get to $165,000 when adding in vacation, pension, health care, and other benefits.


While most expect the clerical workers to stay on the job while they go back to the bargaining table, the threat of another strike and port shutdown certainly looms, though we have to think even the Longshoremen have to be questioning the wisdom of this move.

(Global Supply Chain Article Continued Below)




"We are extremely disappointed by this vote and strongly urge the parties to work through their differences without any kind of disruption. Ratification of a contract is needed to give retailers and other industries that rely on these ports the predictability they need to make long-term plans and get back to growing their businesses and creating jobs," said the NRF's Jonathon Gold, Vice President for Supply Chain and Customs Policy. "The shutdown during the holiday shopping season was more than just a fight between labor and management – it threatened to impact consumers' shopping plans at the most crucial time of the year. We can't afford to see another shutdown."


At this point, it is not clear what the union is unhappy with in this new contract. To this point, the union has made no comment about what led to the contract rejection.


Under an editorial titled "Spoiled Kids?", the normally union friendly Los Angeles Times asked "Are they for real?", and noted that "It's hard to feel sorry for clerical employees who simply track cargo containers from ships to warehouses -- a job that many ports around the world use computers to complete. For this simple task, they are paid more than $40 an hour and receive extremely generous medical and pension benefits."


SCDigest will continue to track what is happening here, so come back often for more details as they emerge.


What's your reaction to the ILA agreement? Should shippers be concerned about the cost impact or not? Let us know your thoughts either via email or in the Feedback section below. We will keep your comments anonymous by request.



Recent Feedback

It is amazing that we lost a lot of money last time and can not afford another hit like that. The federal goverment must get involved & resolve this before is too late.

Armando Gama
Logistics Director
Atlas Logistics, LLC
Feb, 08 2013