February 17, 2015 / 7:13 PM / 2 years ago

UPDATE 2-U.S. West Coast ports reopen as labor secretary arrives for talks

5 Min Read

(Adds analysis of options available to Obama under U.S. labor law)

By Steve Gorman

LOS ANGELES, Feb 17 (Reuters) - U.S. West Coast ports, closed to incoming cargo vessels during the three-day holiday weekend, reopened in full on Tuesday as Labor Secretary Tom Perez arrived in San Francisco seeking to broker a settlement ending months of shipping disruptions.

Perez was sent to meet with the two sides in the conflict at the behest of President Barack Obama, who has come under mounting pressure to intervene in a labor dispute that has cascaded through the U.S. commercial supply chain and beyond.

It was not immediately clear whether Perez would meet with the two sides together or separately. But one source familiar with the situation said Perez would likely huddle in a room with the principal negotiators from both sides, along with the federal mediator who joined the talks last month.

Administration officials offered few details.

"Secretary Perez has meetings with both parties today in San Francisco," spokeswoman Xochitl Hinojosa said in an email. "He'll urge the parties to resolve their dispute quickly at the bargaining table. We don't have any updates at this time."

Labor law experts said Obama has few other options at his disposal to spur a settlement in the contract negotiations, which have dragged on for nine months amid worsening cargo backups and curtailed port operations that the two sides have blamed on each other.

And it was not clear what Perez could bring to the table besides the symbolic weight of Cabinet-level involvement.

The International Longshore and Warehouse Union, representing 20,000 dockworkers, and the bargaining agent for shipping companies and terminal operations, the Pacific Maritime Association, have declined public comment since agreeing last Friday to honor a news blackout requested by the mediator.

The PMA previously said the talks hit a snag on a union demand for changes in the system of binding arbitration of contract disputes. The union has insisted an accord is near.

Operations to load and unload cargo vessels at all 29 West Coast ports were halted through the holiday weekend as of Friday night but resumed Tuesday morning, port authorities said. More than 30 freighters idled through the weekend waiting for berths to open outside the adjacent ports of Los Angeles and Long Beach, the nation's two busiest cargo hubs.

It was the longest such suspension in the months-long labor dispute. Vessel operations were likewise halted for two days last weekend, and again last Thursday, a union holiday.

But shippers said work at the ports has continued in the dockyards, rail yards and terminal gates to move cargo already unloaded from ships.

Domino Effect

The affected ports handle nearly half of all U.S. maritime trade and more than 70 percent of shipments from Asia. A domino effect has rippled through much of the U.S. economy, extending to agriculture, manufacturing, retail and transportation, hitting imports and exports alike.

The shippers have said they were curtailing port operations because it makes no sense to pay dockworkers premium overnight, holiday and weekend wages during union-caused work slowdowns the companies say have brought the ports to the brink of gridlock.

The union has faulted changes in shipping practices instituted by the carriers themselves for congesting the ports, including super-sized freighters delivering higher volumes of cargo all at once, and say that suspending vessel operations has only worsened matters.

The last time contract talks led to a full shutdown of the West Coast ports was in 2002, when the companies imposed a lockout that was lifted 10 days later under a court order sought by President George W. Bush under the 1947 Taft-Hartley Act.

The two sides went on to clinch a deal in the ensuing "cooling-off" period, but the shipping industry has estimated the 2002 lockout caused $15.6 billion in U.S. economic losses.

Then as now, the companies accused the union of instigating slowdowns that precipitated the crisis.

Invoking Taft-Hartley under current circumstances would appear to be a long shot, said Daniel Mitchell, a professor emeritus for management and public policy at the University of California, Los Angeles.

Obama would need to convince a federal judge that there was a work stoppage - not just a slowdown - stemming from a labor dispute and that it posed a national emergency, rather than an inconvenience to industry, Mitchell said. (Reporting and writing by Steve Gorman in Los Angeles; Additional reporting by Jeff Mason in Rancho, Mirage, California; Editing by Bill Trott and Eric Walsh)

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