There has been an extensive history of conflict between dockworkers and the associations that represent shipping companies and port terminal operators. In fact, as far back as the Great Depression, during a time when some striking dockworkers were actually slain, dockworkers and the opposing associations have had some big hurdles to overcome. The latest hurdle, which was preceded by some nine months of protracted negotiations, may finally be in the past.
A tentative agreement was reached last in late February 2015, which involves 29 ports on the West Coast from Seattle to San Diego. The agreement was not easy to come by however, as the Labor Secretary, Tom Perez, was sent by President Obama himself to ensure that negotiations came to a close. The aforementioned ports handle roughly ¼ of all U.S. international trade, so you can imagine the President’s dismay when the labor dispute lasted as long as it did. While the ports were never completely shut down, the size of the cargo that was backlogged would stretch some 579 miles if put in a line.
The backlog, which had retailers upset due to undelivered merchandise and produce left rotting, could take months to clear. Off of the Southern California coast is a fleet of ships packed with thousands of containers, themselves filled with perishable and nonperishable items that should have been on shelves months ago, and would have been if not for the disrupted international trade due to the labor dispute. And the dispute could have gone on longer.
If not for the President having sent Perez, the negotiations may still have been ongoing. The tentative agreement was reached as the Labor Secretary’s threat for both sides to have to go to Washington to beat out the remaining issues in the dispute loomed over the negotiating table. If that had happened, there was the very real possibility of President Obama invoking the Labor Management Relations Act of 1947 (also known as the Taft-Hartley Act), which awards presidents to get involved in labor disputes. President George W. Bush was the last president to invoke Taft-Hartley, when, in 2002, he forced West Coast ports to open after a 10 day lockout by port employers.
President Obama was surely preparing himself to be a part of the labor disputes, which one could confidently assume is why he sent Perez with the threat of moving the negotiations to Washington. Taking into account that the 29 ports bring in an estimated $1 trillion worth of cargo annually, it would have been foolish of him not to. But this may not be the last we here of this dispute. The tentative deal is only a five-year deal, so if the last major issue of contention, the arbitration system to resolve disagreements, isn’t handled appropriately now, we may be back in the same boat in 2020 – and we know wherever this debate goes, the shipping industry, the President, and scores of maritime lawyers are sure to follow.
