Longshoremen's concessions may slow spiraling shipping costs
Concessionary bargaining reached East Coast docks during the past week as waterfront employers and the International Longshoremen's Association worked out tentative agreements that could limit or freeze fringe benefits. The accords were a response to warnings that high shipping costs - particularly in New York - are diverting business to cheaper Canadian and American ports.Skip to next paragraph
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Dockworkers in 36 ports from Maine to Texas are covered by a master contract for wages, work conditions, and contributions to welfare and pension plans, as well as by local agreements. The master contract was negotiated early last fall but quickly ran into problems. It is now in effect on an interim basis, awaiting local settlements covering the ILA's 50,000 members. An original Sept. 30 strike deadline was extended to Feb. 8.
Last week port negotiators and the union reached a tentative agreement that would limit total fringe benefits to the amount paid in New York - which has the highest costs - or in some instances below that total.
Four days of hard but concessionary negotiations conducted in Florida brought an accord on Jan. 26 that should, if approved by the rank and file, ''certainly start us in the right direction toward containing costs,'' said Anthony J. Tozzoli, director of the port department of the Port Authority of New York and New Jersey.
Thomas W. Gleason, president of ILA, said, ''We have tried to be responsible in this and I think we were.''
The New York area agreement, the first major one on local issues, would limit eligibility of longshoremen for a guaranteed annual income program (GAI) which, since 1966, has compensated covered workers for time not worked under specified conditions. A longshoreman who worked at least 700 hours the year before the program began was assured 2,080 hours of work or equivalent pay annually while he remained on the dock roll.
Initially, the cost was $1.7 million a year but costs skyrocketed due to dock automation and the use of containers. Last year, the cost of the New York GAI was an estimated $70 million and, according to a study just released, was a major factor in costs ''jeopardizing the competitive position of the port.''
The study by the Containerization and Intermodal Institute of New York cited fringe benefit costs of $249 on each container that passes through New York and New Jersey ports, compared with fringe and benefit costs ranging from as little as $11.46 a container in southern Florida to $57.44 in Montreal.
New York shippers had wanted a flat limit on GAI payments. When the union balked, negotiators compromised by an agreement that would cut off payments at age 70, for those employed full time elsewhere or for those collecting social security. Pension benefits would rise up to $200 a month - to $950 - for longshoremen 62 or older with 40 years of credited service on the docks.
Extended welfare coverage and life insurance would also be offered as an inducement for retiring.
Although both sides in the New York-New Jersey agreement are optimistic, there is no certainty that the rank and file will approve the agreement - or that a walkout can be averted Feb. 8.