Tag: International Longshore and Warehouse Union

Creditor challenges bankruptcy plan of ILWU dockworkers union

Terminal operator ICTSI has not given up its quest for tens of millions in damages from the West Coast longshore union.

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One of the world’s largest and highest-profile dockworker unions, the International Longshore and Warehouse Union (ILWU), filed for Chapter 11 bankruptcy protection on Sept. 30, seeking to shield itself from a crippling damage award owed to Philippines-based International Container Terminal Services Inc. (ICTSI).

But the bankruptcy filing is not the end of the saga. The legal battle continues.

Under the proposed reorganization plan, the ILWU would give $6.1 million to terminal operator ICTSI, which is substantially all of its remaining cash, then “rebuild” over the coming years, finally closing the book on a courtroom fight with ICTSI that began in 2013.

The hearing to confirm the reorganization plan will not take place until February at the earliest. In the meantime, ICTSI is crying foul — and telegraphing arguments it will make to oppose the plan’s confirmation.

ICTSI has argued that ILWU’s bankruptcy filing is “what appears to be forum shopping” and expressed concerns that “the full nature and extent of the debtor’s assets have not been fully disclosed.”

ILWU — a small business?

The ILWU filed its case under bankruptcy law’s Subchapter 5, a streamlined process that applies to small businesses with debts of $7.5 million or less. (That ceiling was previously $2.7 million, but was raised in March 2020 as part of COVID relief legislation.)


A jury in Oregon decided in November 2019 that the ILWU owed ICTSI $93.6 million in damages for unlawful labor practices starting in 2013 at ICTSI’s terminal in Portland, Oregon.

A judge ruled in March 2020 that the award was too generous and set maximum damages at $19.06 million — if both sides agreed. 

ICTSI didn’t agree, so a new trial on damages was set to begin in February 2024, with ICTSI seeking $48 million-$142 million this time around. 

Because the damage amount had yet to be confirmed when the ILWU filed for bankruptcy, it didn’t count against the $7.5 million debt limit, and the ILWU, which has no bank debt, qualified under Subchapter 5.

Debt is deemed “liquidated” when the amount is legally certain. “This debt has not been liquidated,” said Judge Hannah Blumenstiel of the ICTSI damages during the initial Chapter 11 hearing in October.

“Eligibility [for Subchapter 5] is determined as of the petition date. And I don’t think there’s any argument to be made that this debt was liquidated as of the petition date.”

This month, a hearing before Blumenstiel on the ILWU case was preceded by a bankruptcy hearing for a pancake restaurant called Stacks. How can a union with 40,000 members serving ports from Los Angeles to the Pacific Northwest — whose president, Willie Adams, speaks with President Joe Biden — fall in the same category as Stacks?

The answer is that the ILWU bankruptcy case only applies to the union management division that lobbies and educates, which has four officers and 21 support staff. “The locals and affiliate unions are separate legal autonomous entities and are not debtors or otherwise involved in this Chapter 11 case,” said Adams in his affidavit.

ICTSI’s main focus now is to shed light on how separate these entities are for the purposes of the bankruptcy case, with the goal of derailing confirmation of the proposed plan.

Its implied argument is that the ILWU could have a lot more assets than it lists and shouldn’t be allowed to hide from the decade-long Oregon litigation using a bankruptcy shield for one portion of its structure.

Alleged ‘entanglement’ with Longshore Division

ICTSI specifically highlighted the ILWU’s Coast Longshore Division (CLD). According to the ILWU’s website, “The core of the union, historically, has been the Longshore Division.”

The terminal operator said in a filing on Nov. 9, “Discerning the true nature and extent of the relationship between the debtor and the CLD has predictably been a primary focus of ICTSI in the discovery process.

“The various overlaps in management, operations and potentially assets between the debtor and the CLD, and the absence of any mention of the CLD in the debtor’s schedules of assets and liabilities or statement of financial affairs, other than three transfers made within 90 days prepetition, are anticipated to arise in connection with plan confirmation.”

ICTSI said that the ILWU’s general counsel, Lindsay Nicholas, provided testimony at creditor meetings on Oct. 24 and Nov. 6 on the debtor’s connections to and interactions with the CLD.

According to ICTSI, Nicholas testified that the CLD is currenting paying ILWU legal fees on 11 of its 12 litigation cases — the ICTSI litigation being the sole exception.

“Nicholas testified that, for more than a decade, the CLD also paid the ILWU’s legal and defense fees incurred in connection with the ICTSI litigation. However, on the eve of the debtor’s bankruptcy filing, the CLD stopped such payments and that obligation moved to the debtor.”

ICTSI also pointed to annual financial reports called LM-2 forms that unions file with the Department of Labor. 

“Nicholas testified that the CLD historically listed the contingent liability associated with the ICTSI litigation on its own LM-2 forms,” but this was “transferred to the ILWU mere months before the debtor’s bankruptcy filing.”

“ICTSI is coming to appreciate the extent of the entanglement between the debtor and the CLD. ICTSI is further concerned that this type of entanglement and overlap could extend to other divisions and entities under the broader ILWU organizational umbrella.”

Click for more articles by Greg Miller 

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Port of Los Angeles ready for bountiful container volumes

“The table is set to scale up as demand increases,” said Port of LA Executive Director Gene Seroka.

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Port of Los Angeles Executive Director Gene Seroka said a 55% year-over-year (y/y) increase in exports in September bodes well not only for the West Coast gateway but for the entire country.

“Exports are trending up and that’s good news because narrowing the trade gap boosts the U.S. economy. Additionally, export jobs on average pay more than work in other segments,” Seroka said during a media briefing on Monday.

Seroka reported that for the second consecutive month, the port’s cargo volume increased compared to 2022. The Port of LA handled 748,400 twenty-foot equivalent units, a 5.4% increase from September 2022. In addition to the 55% increase in exports to 120,635 TEUs, imports were up 14% y/y to 392,608 TEUs. Empty containers handled totaled 235,197 TEUs, an 18.5% decline y/y.

“With a long-term dockworker contract in place, we’re seeing more cargo shifting back to Los Angeles,” Seroka said. “The table is set to scale up as demand increases.”

Mario Cordero, CEO of the neighboring Port of Long Beach, last week also credited the International Longshore and Warehouse Union contract, which was ratified at the end of August, for a return of positive cargo numbers to San Pedro Bay.  

Intermittent work stoppages this year during contract negotiations between the ILWU and Pacific Maritime Association negatively impacted both ports. From Jan. 1 through Sept. 30, the Port of LA processed 6,398,126 TEUs, an 18.6% drop from the same period in 2022.


At Monday’s media briefing, Seroka hosted Matthew Shay, president and CEO of the National Retail Federation, who shared the port chief’s optimism.

“Retailers have been hard at work getting holiday inventories in place to provide consumers with great products, competitive prices and convenience at every opportunity,” Shay said. “As we gear up for the holiday season, we expect moderate growth to continue as consumers focus on value and household priorities.”

Port of Long Beach CEO: ‘Consumer confidence is on the rise’ 

Port of Long Beach: Consumer spending decline contributed to import drop

October bountiful for ports on East, Gulf coasts

Click here for more American Shipper/FreightWaves stories by Senior Editor Kim Link-Wills.

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How a fight over 2 jobs bankrupted union of 40,000 dockworkers

The Chapter 11 filing of the ILWU dockworkers union dates back to a dispute over two electrician jobs in Oregon a decade ago.

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In October 2021, Willie Adams, president of the International Longshore and Warehouse Union (ILWU), sat across the table from President Joe Biden at the White House. The two met again at the White House last month, celebrating the new six-year labor contract for America’s West Coast ports.

“I’ve known Willie for a long time,” said Biden after the latest meeting. “I was kidding him: I said I want to know who his haberdasher is. He looks awfully good, doesn’t he? I like that cut.”

Just a few weeks later, Adams is engaged in a far less prestigious task: securing Chapter 11 protection for his union in the Bankruptcy Court of Northern California.

Adams proposed a restructuring plan in a court filing Monday calling for the ILWU to hand over substantially all of its remaining cash — $9.5 million — save for “a reserve for working capital necessary to enable the ILWU to maintain its operations and rebuild.”

The recipient of the proposed payout: International Container Terminal Services Inc. (ICTSI), a global terminal operator based in Manila, Philippines.

The irony is that the bankruptcy of one of America’s highest-profile unions, representing over 40,000 workers, whose president hobnobbed with Biden, began with a feud over two electrician jobs a decade ago at a niche container facility in Portland, Oregon.

New trial too expensive for ILWU to bear

A jury decided in November 2019 that the ILWU owed ICTSI $93.6 million in damages for unlawful practices including work stoppages, slowdowns and other coercive actions starting in 2013 at the ICTSI terminal in Portland.

The terminal lost its shipping line clients and ICTSI terminated its lease in 2017, paying over $11 million in penalties to get out early (it had signed a 25-year lease in 2010).

Oregon District Court Judge Michael Simon ruled in March 2020 that the jury award was far too generous. He set maximum damages at $19.06 million — if the two sides would agree. If not, there would be a new trial on damages. ICTSI didn’t agree.

The appeals process is over on arguments about guilt or innocence: By law, ILWU owes ICTSI. The new trial on damages was set to begin in late February 2024. ICTSI was seeking $48 million-$142 million.

The ILWU estimated that it would have to pay $8.5 million in additional legal fees during the new trial on top of any damages awarded, thus the Chapter 11 filing that halts the trial process.

A decade-old ‘symbolic’ dispute

The events leading up to the current situation were recounted in the 2020 ruling by Simon.

They occurred years before Adams was elected president of the ILWU in 2018, before COVID and the supply chain crisis put West Coast dockworkers in the spotlight in 2021-2022, and before contentious negotiations on the new labor contract spawned fresh supply chain fears in early 2023.

When ICSTI began operating Portland’s Terminal 6 in 2010, jobs for electricians plugging, unplugging and monitoring refrigerated containers (reefers) continued to be controlled by the Port of Portland, which assigned them to two electricians of a rival of union of ILWU, the International Brotherhood of Electrical Workers (IBEW).

This conflicted with the labor contract between the ILWU and the Pacific Maritime Association (PMA), the organization that represents West Coast terminals. The contract called for ILWU members to handle reefer jobs at PMA-member terminals, including Portland’s.

The Portland dispute wasn’t just about the two electrician jobs, it was about the principle, according to ILWU testimony.

As recounted by Simon, “ILWU National’s then-President Robert McEllreth testified that the Terminal 6 reefer jobs were ‘symbolic’ of jobs ‘up and down the coast’ and that to ‘let those jobs go … would bleed up and down the whole entire West Coast and … would undermine the contract.’”

Leal Sundet, then an official of ILWU National, testified that “any time you have a contractual matter that any one given PMA employer refused to comply with, that’s an assault on the fabric of the [labor] agreement. Because why would the next PMA employer need to comply with the agreement, and the one after that? If you let the PMA member companies start picking and choosing what parts they’re going to comply with, then you don’t have a contract any longer.”

After ICTSI terminated its lease in 2017, the Port of Portland, the PMA and the ILWU agreed that the reefer jobs would be handled by ILWU members in future container operations at Terminal 6. But by that time, the damage was done. The ICTSI lawsuit — which would eventually result in ILWU’s Chapter 11 filing — had been set in motion.

Click for more articles by Greg Miller 

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ILWU dockworkers union files for Chapter 11 bankruptcy protection

Just when it looked like West Coast port labor drama had dissipated, the ILWU has filed for bankruptcy protection.

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The International Longshore and Warehouse Union (ILWU), which represents dockworkers at ports along the Pacific coast of the United States and Canada, filed for Chapter 11 bankruptcy protection just before midnight on Saturday.

The ILWU “will continue to operate as usual throughout the restructuring process,” the union said in a statement on Sunday morning. It plans to “continue honoring its employee and payroll obligations in the ordinary course of business.”

The bankruptcy filing was precipitated by a massive damage award in a case involving a long-running legal dispute between ILWU Local 8, the union chapter in Portland, Oregon, and terminal operator ICTSI Oregon.

In November 2019, a jury found that the union had engaged in unlawful practices in 2013-2017, including work stoppages, slowdowns, “safety gimmicks” and other coercive actions.

After a 10-day trial, the jury awarded $93.6 million in damages to ICTSI, which, if enforced, was expected to push the ILWU into bankruptcy. The jury found that ILWU National was responsible for 55% of ICTSI’s damages, and Local 8 was responsible for 45%.

In March 2020, Oregon District Judge Michael Simon dramatically reduced the amount due, ruling that damages should not exceed $19.1 million. However, even that amount is too high for the union to pay.

The two sides are currently filing briefs regarding the final extent of damages. The ILWU argued in a court filing on Friday that ICTSI’s damages “are non-existent or minimal, at most $3.9 million.”

ILWU filed financial documents as part of its voluntary Chapter 11 petition in the Northern District Court of California. It listed current assets of $11.6 million, including $9.5 million in cash, far below the maximum amount in the judge’s 2020 ruling.

ILWU responds to ‘scorched-earth litigation tactic’

According to ILWU President Willie Adams, “While we have attempted numerous times to resolve the decade-long litigation with ICTSI Oregon, at this point, the union can no longer afford to defend against ICTSI’s scorched-earth litigation tactic.

“We intend to use the Chapter 11 process to implement a plan that will bring this matter to resolution. The officers are confident that we are taking the right step to put our organization on the best path forward — and we are optimistic for all that is ahead.”

The ILWU Chapter 11 filing comes a month after the union ratified a new six-year labor contract with the employers’ group, the Pacific Maritime Association, ending the threat of labor-dispute-related slowdowns at West Coast container ports. Concerns over port labor issues have led to a shift in container shipping volumes to East and Gulf coast ports over the past year.

Click for more articles by Greg Miller 

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Biden hails ratification of West Coast dockworker contract

Along with a six-year port agreement, President Biden is underscoring the role of UPS Teamsters and ocean shipping reform in boosting the U.S. economy.

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WASHINGTON — Recent success by maritime and trucking labor unions is contributing to lower inflation and making the U.S. economy stronger, according to President Joe Biden.

Biden made that case on Wednesday in remarks delivered in the State Dining Room at the White House.

“I want to thank both sides for working through this and getting it done,” Biden said, referring to the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA), whose tentative six-year agreement covering 29 West Coast ports was ratified by ILWU rank and file on Aug. 31.

“It’s a good deal for workers, it’s a good deal for companies, and it’s a good deal for the United States of America.”

The ILWU-PMA contract includes a guaranteed 32% pay increase over the course of the contract and a one-time “hero bonus” — reportedly $70 million — for working through the pandemic.

“With this agreement, [dockworkers] are being paid what they deserve and goods are moving quickly and efficiently across the country,” Biden said.


“Plus, this has a direct impact on reducing inflation. When the cost of moving goods through the supply chains goes up, inflation goes up. Strengthening supply chains … inflation goes down. That’s why we’ve made fixing our supply chains to bring down inflation a top priority. And it’s working.”

Biden also recognized the Teamsters’ ratification of a five-year collective bargaining agreement with UPS, which occurred nine days before West Coast dockworkers approved their contract. The UPS Teamsters contract will allow senior full-time drivers to earn approximately $170,000 a year in wages and benefits, with part- and full-time workers getting $7.50 more in hourly wages over the life of the contract.

“With this historic contract, our Teamsters are going to continue to deliver UPS goods across the country, and our supply chains will continue working the way they should,” Biden said.

The labor agreements build on other actions taken by his administration, Biden noted, including the Ocean Shipping Reform Act that he signed last year. The legislation was passed in part to address severe price increases by foreign container ship operators, which Biden asserted last year — and repeated on Wednesday — had boosted the rate for shipping a container by as much as $1,000 during the pandemic.

“Since then we’ve seen ocean shipping container rates come down to near pre-pandemic levels,” Biden said.

Click for more FreightWaves articles by John Gallagher.

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Dockworkers strike continues at Canada’s West Coast ports

More than 7,400 dockworkers in Canada remain on strike Wednesday after labor contract negotiations with their employer have stalled.

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A strike by 7,400 Canadian dockworkers against their West Coast ports employers has entered its fifth day as negotiations have stalled.

The International Longshore & Warehouse Union Canada’s Longshore Division (ILWU Canada) went on strike Saturday after negotiations with the British Columbia Maritime Employers Association (BCMEA) failed to reach a new labor contract.

The strike could affect container cargo traffic at two of Canada’s busiest ports in Vancouver and Prince Rupert, key export gateways for the country.

On Tuesday evening, the BCMEA said negotiations with ILWU Canada are currently paused, pending further discussion with the federal mediators.

“The BCMEA was hopeful [Tuesday’s] pause would act as a reset in negotiations,” BCMEA posted on its website. “Regrettably, ILWU Canada has not indicated a willingness to modify their position. The BCMEA remains ready to re-engage at a moment’s notice, assuming that ILWU Canada is prepared to put forward a reasonable proposal.”

ILWU Canada President Rob Ashton also expressed disappointment that labor negotiations had reached an impasse. The union has been negotiating for wage increases, an end to contracting out and job protection against the effects of automation.

“We call on the BCMEA to get back to the table and do the hard work necessary to reach an agreement,” Ashton said in a statement. “If the association will not negotiate, we call on the member employers to negotiate directly with the union. A negotiated settlement is possible, and we are capable of getting the job done.”

Canadian National Railway Co. said the labor dispute could result in increased shipping and consumer costs if it continues.

“A labor disruption can create significant impacts on shippers’ decisions to use Canada’s ports,” spokesperson Jonathan Abecassis said in a statement. “Given the integrated nature of ports and rail corridors, a work stoppage can create disruptions that take weeks or even months to correct.”

Click for more FreightWaves articles by Noi Mahoney.

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Dockworkers at Canada’s West Coast ports launch strike

More than 7,400 dockworkers have gone on strike in Canada, potentially causing disruptions at ports in Vancouver and Prince Rupert.

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More than 7,400 dockworkers represented by the International Longshore and Warehouse Union in Canada went on strike Saturday after negotiations with the British Columbia Maritime Employers Association (BCMEA) failed to reach a new labor contract. 

The strike threatens to disrupt container traffic at two of Canada’s busiest ports in Vancouver and Prince Rupert, key export gateways for the country.

The union’s strike was officially announced Saturday in a Facebook post by ILWU President Rob Ashton. ILWU Canada has been negotiating for wage increases, an end to contracting out and job protection against the effects of automation.

“During the pandemic, longshore workers put themselves on the front lines to make sure that the people of British Columbia and all their families and all Canadians have the necessary goods and supplies when all other Canadians were asked to stay home to stay safe,” Ashton said during a news conference on Sunday. “We were called heroes at that time and our employers gorged themselves on record profits. But now they seem to have forgotten the sacrifices our people made.”

Contract talks between ILWU Canada and BCMEA have been ongoing since February in an attempt to renew the industrywide collective agreement, which expired March 31.

On Sunday, Ashton said negotiations are still ongoing.

“I was in hopes that sometime today or even earlier, we’d be coming with a better announcement, but we do not have one,” Ashton said. “We’re here until the end. We do not plan to leave the bargaining table. We expect the BCMEA [to be here] all day, all night, until a deal is done so our people can go back to work with a fair negotiated deal for all of us.”

The BCMEA posted on its website that contract negotiations were being paused on Sunday night after 33 consecutive hours of negotiations.

“The committee intends to reconvene bargaining [Monday] morning, providing an opportunity for both parties to recharge and re-energize in the interest of achieving a fair and balanced agreement as soon as possible,” BCMEA said.

A prolonged strike could affect cargo traffic at the ports of Vancouver and Prince Rupert, said Jasmin Guenette, vice president of national affairs at the Canadian Federation of Independent Business (CFIB).

The CFIB is the country’s largest association of small and midsize businesses with 97,000 members across various industries and regions.

“A strike could have serious consequences for our economy and our small businesses,” Guenette said in a news release. “Port operations must remain fluid so as not to exacerbate supply chain disruptions and put further pressure on costs, at a time when we are still facing high inflation.”

The Port of Vancouver is the country’s largest commercial port, accounting for 3.6 million twenty-foot equivalent units in 2022. The Port of Prince Rupert, located in the Canadian province of British Columbia, recorded 24.6 million tons of cargo moving through its gates last year.

Officials at the ports of Vancouver and Prince Rupert did not immediately respond to a request for comment from FreightWaves.

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Click for more FreightWaves articles by Noi Mahoney.

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Confusion reigns as labor dispute ‘fog’ blankets West Coast ports

“Patience is wearing thin. Neither side imagined it would take this long,” says the head of the Port of LA on dockworker contract talks.

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There’s the fog of war and there’s the fog of West Coast port labor disruptions.

More than a year after negotiations began and over 11 months since the last contract expired, employers and dockworkers still haven’t come to terms over pay. Accusations are flying. Those speaking to the press have agendas, as do those remaining largely silent.

Relations took a major turn for the worse starting in early June, with no resolution in sight. Acting Labor Secretary Julie Su arrived in San Francisco to meet with the two sides Monday and remained at the table on Tuesday.

Media coverage is warning of a renewed supply chain crisis, but data on ship movements and cargo operations is not particularly alarming — at least, not yet.

‘Confusing for all of us’

“These past couple of weeks have been challenging and at times confusing for all of us out here at the West Coast ports. There have been claims, counterclaims and daily concerns,” said Port of Los Angeles Executive Director Gene Seroka during a press conference Tuesday.

“Of course, we’re all concerned. The deal’s not done yet. Patience is wearing thin. Neither side imagined it would take this long.”

Seroka acknowledged that there have been spot shortages of workers and a “handful of bad days” with “slower moving containers than we’d like to see and longer lines on occasion for trucks, and we’ve had terminals not open their truck gates due to a shortage of labor or other business decisions.” Nevertheless, Seroka maintained that “the data suggest that the overall impact has been minimal” and “the cargo is flowing.”

Highlighting how different parties are putting out different spins, the commentary on the situation in Los Angeles from the Pacific Maritime Association (PMA), representing terminal employers, is more dire than from the Port of Los Angeles itself, or from the International Longshore and Warehouse Union (ILWU).

PMA-ILWU war of words

According to the PMA, the “concerted and disruptive work actions” by the ILWU effectively shut down Los Angeles and Long Beach on June 2 and “shut down or severely impacted terminal operations” in Oakland and Hueneme, California, and Seattle and Tacoma, Washington, that day.

The PMA said work actions continued to disrupt terminals in Los Angeles, Long Beach and Oakland over the weekend into the following Monday, June 5. But a Port of Los Angeles spokesperson told FreightWaves it was “a one-day event that impacted some of our terminals to varying degrees on Friday. All terminals in LA are open [as of June 5].”

Last Friday, the PMA said ILWU work actions had resumed after a pause, with the union refusing to dispatch lashers, the workers who secure and unfasten containerized cargoes, in Los Angeles and Long Beach. The PMA also said the ILWU had effectively shut down the Port of Seattle on Saturday.

Asked whether Seattle had been shut down, the Northwest Seaport Alliance, which manages Seattle and Tacoma, told FreightWaves: “Each terminal operator is making its own decisions regarding operations, which vary across our gateway. Our gateway remains open, with the level of operations varying by terminal and in each harbor.”

ILWU President Willie Adams said on Saturday, “Despite what you are hearing from the PMA, West Coast ports are open.” The ILWU said the PMA “continues using the media to leverage one-sided information in an attempt to influence the process.”

On Monday, the PMA disputed Adams’ statement on ports being open and accused the ILWU of resuming its practice of withholding lashers in Los Angeles and Long Beach.

Seroka said he couldn’t point to “any one job class, any one work group or any one employer” when asked on Tuesday about allegations that the ILWU was withholding lashers in Los Angeles. “I’m not going to validate one view against another,” he said.

Data shows mixed fallout so far

Amid all the conflicting agendas, data on the labor disruption fallout is mixed. It shows little impact in some cases. In others, it does show fallout, with different ports seeing varying impacts on imports versus exports.

Seroka cited data showing that dwell time for all containers on LA port terminals had decreased 9% over the past month and dwell time for on-dock rail containers was down 18%, with the number of on-dock rail containers down 14% over the past month.

Ship-position data from MarineTraffic showed nine ships waiting offshore of U.S. West Coast ports on Tuesday (one off Long Beach, two off Oakland and six off Seattle/Tacoma). But the same number of ships were waiting off East and Gulf Coast ports, where there are no labor disruptions, and the West Coast queue was negligible compared to the queue during the supply chain crisis, when there were close to 100 container vessels off West Coast ports for months.

Weekly average data from project44 on the average dwell time for inbound boxes has risen recently, but not significantly.

Blue line: Oakland export dwell time. Green line: Long Beach. Orange line: Los Angeles. Purple: Seattle. (Chart: FreightWaves SONAR)

However, daily data from project44, which is more volatile, shows more dramatic changes. It shows that dwell time for export containers in Long Beach and Oakland have risen well above dwell time for import containers in recent days, while the opposite situation prevails in Seattle, where import containers are dwelling much longer than export boxes.

(Charts: project44)

Click for more articles by Greg Miller 

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West Coast dockworkers making $200K demand higher pay

Dockworkers who keep West Coast cargo flowing are highly paid. Their bid for even higher pay is starting to affect the cargo flow.

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West Coast container port operations are being disrupted by a dispute over the size of dockworkers’ next pay raise, with disruptions now starting to affect ship operations.

“We got a rash of vessel movements canceled overnight,” said Kip Louttit, executive director of the Marine Exchange of Southern California, on Wednesday.

Departures of six ships berthed in Los Angeles or Long Beach have been delayed: the Cosco Portugal, Cosco Oceania, Cosco Shipping Rose, CMA CGM Amerigo Vespucci, CSCL Yellow Sea and YM Unicorn. Arrivals of four ships to the ports are delayed: the Aitolikos, Cosco Denmark, Cosco Netherlands and Cosco Taicang. Yet another ship, the MSC Jeongmin, had its arrival in Los Angeles delayed Tuesday.

International Longshore and Warehouse Union (ILWU) dockworkers handle cargo across the West Coast, including at the major container gateways of Los Angeles, Long Beach and Oakland in California, and Seattle and Tacoma in Washington.

Union pushes for higher wages

The ILWU is demanding wages and benefits in the next five-year contract that reflect dockworkers’ role in the COVID-era import boom, a one-off event that ended last year. The prior contract expired July 1, 2022.

The union cited the decrease in member wages and benefits as a share of the revenues of terminal employers and ocean carriers represented by the Pacific Maritime Association (PMA).

ILWU Local 13 said that “ocean carriers and terminal operators have thumbed their noses at the work force’s basic requests” after effectively treating dockworkers’ lives as “expendable in the name of profit” during the pandemic.

If the narrative is “greedy employers take advantage of American workers,” it’s only fair to take a closer look at what West Coast dockworkers currently earn — the starting point for pay and benefits they’re seeking to boost in the new contract.

Detailed compensation data is published annually by the PMA. It shows that West Coast dockworkers are already some of the highest-paid workers in the country.

ILWU wages vs. other professions

Full-time registered longshore workers earned an average of $197,514 in 2022, not including benefits, according to the PMA. Clerks earned an average of $220,042 and foremen and walking bosses averaged $306,291. (Full time is defined as working 2,000 hours or more per year, or 38.4 hours per week.)

The PMA also paid $100,534 per ILWU registrant in benefits costs. Benefits include full insurance coverage, a 401(k) and a pension with a maximum yearly retirement benefit of $95,460.

The U.S. Bureau of Labor Statistics compiles data on average annual wages by profession. West Coast dockworkers rank toward the top when compared to the government stats.

Full-time dock foremen earned 24% more than the average CEO’s base salary in 2022 and 20% more than neurologists. ILWU clerks earned just $5,600 per year less than airline pilots. Full-time dockworkers came in 21% higher than lawyers and 9% above dentists.

Average earnings in 2022 for all full-time ILWU registrants — $211,000 — were 3.4 times higher than the average wage for all professions calculated by the Bureau of Labor.

(Chart: FreightWaves. U.S. salaries as of May 2022 from U.S. Bureau of Labor Statistics. ILWU earnings data from PMA 2022 annual report.)

The caveat on the PMA data is that a portion of union registrants are under the full-time threshold. Of longshore workers, 42% worked less than 2,000 hours in 2022. The bulk of longshore workers (including non-full-time workers) earned in the $100,000-$200,000 range.

Among clerks, 19% worked less than 2,000 hours, with overall earnings bunched in the $150,000-$225,000 range. Of walking bosses and foremen, only 10% did not meet the full-time definition. Salaries were grouped in the $250,000-$325,000 range. Some foremen earned over $400,000 and a few topped a half-million.

chart of dockworkers salaries
(Chart: PMA 2022 annual report)

How ILWU earnings are calculated

The average 2022 ILWU registrant base rate — $46.23 per hour — doesn’t sound that steep for skilled labor. But as the PMA explained in its annual report, worker earnings also include an additional component based on skill level. Skill bonuses range from $2.40 to $5.80 per hour and were added in 80.7% of hours paid last year.

Pay also increases for the second shift (eight hours starting 6 p.m.) and third shift (five hours starting at 2:30 a.m.) to $61 to $83 per hour. Work on these shifts accounted for 38.5% of total hours paid last year.

Then there is overtime, which accounted for 36.4% of hours paid in 2022. Overtime pay rates range from $69 to $93 per hour. Altogether, the PMA said the effects of skills bonuses, work shifts and overtime brought the effective average rate for all hours paid to $64.10.

COVID was yet another key factor. The ILWU labor force was essential to keeping goods flowing during the pandemic, despite risks to the dockworkers’ health. At least 43 union members died of COVID, according to the ILWU.

The change in consumer behavior during the pandemic led to a flood of cargo into West Coast ports that continued through the first half of last year, hiking both straight hours (non-overtime) and overtime.

The PMA paid ILWU registrants at all U.S. West Coast ports total wages of $2.31 billion in 2022, up $371 million or 19% versus 2019, pre-pandemic. The effective hourly rate rose 7% over the three-year period. Straight time was 22,895,230 hours in 2022, up 8% from 2019. Overtime came in at 13,084,540 hours, up 16%.

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DOL nominee announces ‘progress’ in West Coast labor talks

Biden’s labor secretary pick says she’s ready to step in if West Coast dockworkers and their employers cannot resolve their remaining issues.

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WASHINGTON — President Joe Biden’s pick to lead the U.S. Department of Labor said she is playing an active role in ongoing negotiations between West Coast dockworkers and their container terminal employers, including progress reported on Thursday.

“I have been engaged with the parties and our role is to help support them to stay at the table and support them in resolving their issues,” labor secretary nominee Julie Su said during her nomination hearing before the Senate Health, Education, Labor and Pensions Committee on Thursday.

“I recently pressed upon them the urgency of the issue, and I’m pleased they’ve made some progress. There are still issues that need to be resolved, but I think this is a good example of how the collective bargaining process really works.”

Sen. Tina Smith, D-Minn., read to her a quote from Port of Los Angeles Executive Director Gene Seroka praising Su for her close communication and being “on the phone with us morning, noon and night.”

Su stated that her role, if she is confirmed, “would be to — when asked — help make sure that the parties stay at the table, that they are able to grapple with some of the hard issues that they face. If asked to assist I would do so, but I would not give up on the negotiations at this time.”

News of a tentative agreement on several issues, according to reports, comes just two weeks after labor unrest between the Pacific Maritime Association, representing the terminals, and the International Longshore and Warehouse Union shut down operations at the ports of Los Angeles and Long Beach, California.

During the hearing, Su, who became acting secretary of the department after Marty Walsh resigned in February, also touted her experience working with Walsh and Biden to forge a tentative agreement with the Class 1 railroads and their unions during tense negotiations last September.

But GOP members of the committee as well as other Republicans in Congress strongly oppose her nomination given her support for California’s AB5 law on independent contractors. Because the law implements what is known as the ABC test, which essentially requires that truck drivers working with a carrier through lease agreements be classified as employees, that opposition is shared by drivers and carriers that thrive on the business model.

“We are concerned that Ms. Su would continue to pursue an ideologically motivated agenda towards worker classification that ignores the thousands of small-business truckers that depend on the ability to work as an independent contractor,” said Todd Spencer, president and CEO of the Owner-Operator Independent Drivers Association.

“Make no mistake: If Ms. Su were to advance the same policies that she championed in California, it would force hundreds of thousands of truckers to change their business model and put their livelihood in jeopardy.”

Spencer added that OOIDA is ready to work with senators “to address misclassification and improve working conditions in the trucking industry. But we believe that Ms. Su’s confirmation would make it extremely difficult to fix these issues in a way that benefits America’s truckers.”

Su attempted to dispel those fears when asked if she would commit to not trying to force an AB5-type regulation on the rest of the country through a Labor Department rulemaking currently in progress.

“The short answer is yes,” she told the committee. “The California legislature did pass AB5 that codified the ABC test. But when the Department of Labor issued our rule on independent contractor versus employee classification, we explicitly did not include the ABC test in our rule. Only Congress can adopt the ABC test.”

However, Sen. Bill Cassidy, R-La., pointed out that federal agencies can implement rules in a way that accomplishes an agenda that might not reflect the intentions of lawmakers. “So is there an equal commitment to not attempt to do through a rule what would otherwise have the same effect [as including the ABC test]?” Cassidy asked.

“I will commit with absolute certainty that I will always have full faith and fidelity to federal law,” Su responded.

“That’s different,” Cassidy said. “A smart attorney can find all sorts of interpretations of federal law.”

The committee will vote on her appointment next week, and if approved her nomination advances to the Senate floor.

Click for more FreightWaves articles by John Gallagher.

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