SAN FRANCISCO (REUTERS) — West Coast port employers reached a tentative deal with union longshoremen Friday regarding technology, the key issue blocking a new contract agreement for dock workers who handle more than half of U.S. trade.
Federal mediator Peter Hurtgen said that although there was no final agreement yet, the tentative deal between the International Longshore and Warehouse Union and the Pacific Maritime Association addressed the issue of who will control new jobs created by technology.
“The parties have worked long and hard,” Hurtgen said in a statement.
He added that no other details on the technology deal would be released until the two sides agree on a final contract, which would end a dispute that sparked a 10-day lockout in September and October, paralyzed billions of dollars worth of U.S. trade and forced the Bush administration to invoke the 1947 Taft-Hartley Act to get the ports back in business.
Both sides said the technology agreement marked a major step forward in their negotiations.
A PMA spokesman called the deal a possible turning point but declined to comment further, citing the federal mediator’s request for a media blackout on the talks.
ILWU spokesman Jeremy Prillwitz called Friday’s deal a victory and a major breakthrough for the powerful 10,500-member union, although he noted other important issues, like pensions, remained unresolved.
“We had some bottom-line issues, and those issues were addressed by this agreement,” Prillwitz said. “This is an important accomplishment, and we are ready to move on to the next issue now.”
The longshoremen’s contract negotiations with the PMA have stalled largely on the issue of technology, and continued tensions on the docks have raised fears of more major disruptions in port facilities that handle $300 billion worth of goods each year.
Port employers have maintained that new technology — such as computerized cargo-handling machinery — is needed to keep operations competitive, but labor leaders feared the changes could undermine union control of the docks.
Analysts said the technology deal was a positive sign for negotiations and could decrease tensions that continue to slow cargo traffic through the ports.
“If there’s an agreement in principal, it changes the contentious situation, it will generate some goodwill, and maybe we’ll see some return to normal work patterns,” said Ross DeVol, an economist with the Milken Institute in Los Angeles.
The West Coast port crisis, which has hit port facilities stretching from San Diego to Seattle, has fueled fears of more disruptions in the fragile U.S. economy.
News of Friday’s breakthrough helped boost stocks in after-hours trading, and analysts said the agreement came at a critical time, as retailers look to stock their shelves with goods for the holiday season.
“If they had a settlement, it could be a significant benefit for the economy, for corporate profits and therefore for stocks,” said Philip Orlando, chief investment officer at Value Line Asset Management. “That will further ensure that there will be goods in the stores for consumers to buy for holiday shopping.”
Following the recent lockout, West Coast docks were reopened Oct. 9 after the Bush administration took the rare step of invoking the Taft-Hartley Act to put the ports back in business under a court order.
Since then, the union and the Pacific Maritime Association, which represents shipping lines and terminal operators, have traded blame for an appreciable slowdown in cargo traffic as the two sides continue talks with the federal mediator.
The bad blood between the two sides spurred the union to ask the Justice Department Friday to investigate its charges that West Coast port employers had colluded with the federal government to weaken the longshoremen’s bargaining position in the contract talks.
The union has long accused the PMA and the federal government of orchestrating the port crisis to break the union’s control over the docks.
While most analysts agreed that Friday’s announcement marked a big step forward, some warned that that it was still too early to say that the port crisis was over.
“There’s many steps to go here before we see a final agreement, but it’s certainly a positive sign if indeed they have an agreement on technology,” said Peter Olney, a former ILWU organizer who is associate director of the University of California Institute for Labor and Employment.