Bitter shipping battle continues at Oakland port

Bitter shipping battle continues at Oakland port
By Peter FimriteFebruary 7, 2015 Updated: February 7, 2015 4:38pm
Justin Sullivan/Getty Images
OAKLAND, CA - FEBRUARY 06: A Maersk Line container ship sits idle in the San Francisco Bay just outside of the Port of Oakland on February 6, 2015 in Oakland, California. Pacific Maritime Association announced today that terminal operators at 29 West Coast ports will be shutting down cargo operations amidst long labor negotiations with the International Longshore and Warehouse Union. (Photo by Justin Sullivan/Getty Images)
The sniping and backbiting between dockworkers and shipping officials intensified this weekend at the Port of Oakland as the long-running contract dispute at 29 ports on the West Coast dragged on, causing crippling delays and devastating economic losses.

The Pacific Maritime Association, which represents shipping lines and terminal operators, and the International Longshore and Warehouse Union, which represents 20,000 dockworkers, have been at an impasse since July 1, when the union contract ran out.

Work delays and stoppages over the past three months have caused mounting problems for Bay Area importers and small-business owners, who say they are losing money as trucks line up daily outside the Port of Oakland waiting for container ships anchored in San Francisco Bay to unload.

The Maritime Association suspended vessel loading and unloading operations over the weekend at all West Coast ports, including Oakland. The move, which essentially eliminated weekend overtime work for thousands of longshoremen, was in retaliation for what association officials called vindictive work slowdowns and stoppages.


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“The member companies concluded that they will no longer pay premium pay for diminished productivity,” said Wade Gates, the association spokesman, adding that shipping lines pay time-and-a-half on the weekends.

Craig Merrilees, spokesman for the union, called the decision “irresponsible and damaging to people who need their containers.” The merchants, he said, “are being held hostage by these foreign-owned companies that are committing economic terrorism against workers and business owners.”

James McKenna, the maritime association president, denied rumors he was considering a lockout, but urged the union to accept what amounted to 3 percent raises over five years, employer-paid health care and an 11 percent increase in pensions. The association said the average dockworker currently makes $147,000 a year in salary.

But money isn’t the primary issue, Merrilees said. Job security and improved worker safety are the real concerns, he said, especially since dock workers are servicing larger ships, handling more cargo and dealing with increasing pressure to speed things up.

“The industry has been showing a willingness to outsource and destroy good jobs,” said Merrilees. “Our goal is to make sure the good-paying blue-collar jobs that 30 communities up and down the coast depend on today are there tomorrow.”

The steadily deteriorating situation also has affected the 28 other ports between Seattle and San Diego, delaying merchandise deliveries up and down the coast. It is so bad that McKenna said last week that a “coast-wide meltdown” is imminent if a settlement isn’t reached.

Michael Zampa, communications director for the Port of Oakland, said anywhere from a half-dozen to a dozen ships are anchored in the bay every day, waiting for a spot at the Oakland marine terminal. An equal number are stuck outside the Golden Gate because there is no room for them to even anchor in the bay. Union workers have cut production from an average of about 32 containers moved per hour in October to about 24 per hour in February, he added.

“There has been a noticeable decline in productivity and there have been disruptions,” Zampa said. “At various times, labor has walked off the job, claiming health or safety concerns, and there has often been less than the full complement of labor deployed to terminals.”

The Port of Oakland is the third-largest port in California and the fifth-biggest in the United States. Port officials lease the facilities to marine terminal operators and are not involved in the contract negotiations. Still, the impasse has had a major impact on operations.

The port employs only about 500 people, but there are at least 73,000 ancillary jobs, including crane operators, cargo handlers, warehouse crews, railroad workers, customs officials and importers, all the way down to the taco stand operator, Zampa said.

Between 7,000 and 9,000 truckers pick up or drop off cargo at the port, and many of them have had to wait as long as eight hours to get into the terminal. That’s not to mention all the merchants who purchased the goods sitting in the containers.

“Businesses both big and small are affected if this port shuts down,” he said, “and you've got the same scenario magnified in Los Angeles, Long Beach, and also in Seattle and Tacoma.”

One Bay Area importer of European antiques, who asked not to be named because of fear of retribution, recently had to wait almost a month past the scheduled arrival date for the shipping container holding goods he purchased from France. He ended up paying $5,100 more than normal because of inspection and storage fees, even though the container was not available to be picked up.

“I couldn’t get it, but they were charging me for storage, and they wouldn't let me pick it up myself until they could move it to where it could be picked up. It was a perfect catch-22,” said the importer, who owns a small store that he said barely provides him with a living. “They're sticking it to everybody. Maybe the bigger companies can absorb this, but it was hard for us.”

Pavel Hanousek, co-founder of SkLO, a glass product design and manufacturing firm in Healdsburg, told The Chronicle that his monthly container of glass from the Czech Republic was delayed for more than three weeks. While he waited, orders worth $100,000 were canceled and most of his 12 employees had to be sent home. He said he is now looking to use other ports, including Houston and those on the East Coast.

The Port of Oakland set a record for the number of freight containers it handled in 2014, in part because of diversions from Los Angeles and Long Beach. The two Southern California ports handle more imports from Asia than any others in the United States, but much of their traffic has had to be diverted because of the same shipping congestion problems that have hit Oakland.

Union officials insist that the back-ups already existed, and worsened only because the maritime association has refused to approve safety measures and make planning and infrastructure improvements that would help workers deal with the increased amount of cargo from super-size container ships.

Federal mediators are in San Francisco trying to help settle the dispute.

Peter Fimrite is a San Francisco Chronicle staff writer. E-mail: Twitter: @pfimrite.