February 20, 2015 / 6:28 AM / 4 years ago

U.S. West Coast ports talks break for night without deal

SAN FRANCISCO (Reuters) - Shipping executives and union leaders for dockworkers at 29 West Coast ports ended a third straight day of contract talks late on Thursday without a settlement, despite arm-twisting from the U.S. labor secretary, but planned to meet again on Friday.

Cargo containers sit idle at the Port of Los Angeles as a back-log of over 30 container ships sit anchored outside the Port in Los Angeles, California, February 18, 2015. REUTERS/Bob Riha, Jr.

Labor Secretary Tom Perez joined the talks in San Francisco on Tuesday at the behest of President Barack Obama, who has come under growing political pressure to intervene in a dispute that has rippled through the trans-Pacific commercial supply chain and could cost the U.S. economy billions of dollars.

The International Longshore and Warehouse Union, representing 20,000 dockworkers, has been locked in negotiations for nine months with the bargaining agent for shippers and terminal operators, the Pacific Maritime Association (PMA).

Tensions arising from the talks have played out in worsening cargo congestion that has severely slowed freight traffic at ports that handle nearly half of all U.S. maritime trade and more than 70 percent of imports from Asia.

More recently, the shipping companies have curtailed operations sharply at the marine terminals, suspending the loading and unloading of cargo vessels for night shifts, holidays and weekends at the five busiest ports.

The disruptions have reverberated throughout the U.S. economy, extending to agriculture, manufacturing, retail and transportation.

Cargo loads that would normally take a few days to clear the ports have been facing lag times of up to two weeks or more as dozens of inbound freighters stack up along the coast, waiting for berths to open.

A longer-term concern has been that U.S. export business lost to other countries and ports may not return once the West Coast dockworker crisis ends.


Mayor Libby Schaaf of Oakland, whose San Francisco Bay port is one of several bearing the brunt of the disruptions, said that Perez told her and other mayors on a conference call on Thursday that he was trying harder to squeeze a deal from the two parties.

“What he shared with us is that if, within 24 hours, the two sides were not in agreement he was going to force the two sides to come to Washington to negotiate,” she said. “He is very committed to continuing to apply pressure and apply the full force of the federal government.”

It was not clear under what authority the government could compel a change of venue in labor negotiations.

Other sources familiar with the situation told Reuters that Perez had spoken, apparently figuratively, of how a failure to reach an agreement in San Francisco might require attempts to move the talks to the nation’s capital.

“He did make some mention of that fact that if they couldn’t get a resolution here (in San Francisco), how they might be invited to D.C. to try to resolve their differences,” said one source who asked to remain anonymous. Another paraphrased Perez as saying: “We need to get it done here. Nobody wants to have to go back to Washington to get it done.”

Schaaf said that U.S. Commerce Secretary Penny Pritzker joined Perez for a second day at the negotiations on Thursday, along with Los Angeles Mayor Eric Garcetti.

Talks adjourned for the day at about 9:30 p.m. local time, and more sessions were planned for Friday, one source said.

Sources said that the chief remaining sticking point in the talks is a union demand for changes in the system of submitting workplace disputes under the contract to binding arbitration.

The PMA has said the union wants the right to remove unilaterally any of the four West Coast arbitrators at the end of each contract period, a move the companies fear could leave arbitrators vulnerable to intimidation.

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 through a court order sought by President George W. Bush under the 1947 Taft-Hartley Act.

Additional reporting by Curtis Skinner in San Francisco and Steve Gorman in Los Angeles; Editing by Eric Beech and David Goodman

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