What is the ILWU Contract?
The term "ILWU" stands for the "International Longshore and Warehouse Union." The parties to the ILWU contract are the union and the Pacific Maritime Association ("PMA"). The ILWU contract is a collective bargaining agreement for longshoremen, including: stevedores, gate personnel, clerks, and watchmen. It is not a contract with the International Longshoreman and Warehouse Workers Union itself. The PMA and the ILWU enter into the ILWU contract jointly , but sometimes at different times. The ILWU contract is a master contract covering all employers in the jurisdiction. The contract has regional appendices that either supplement the master contract or replace certain sections of the master contract. The contract is a four-year agreement, "up" only once every four years.
A Brief History of the ILWU Contract Negotiations
The history of the ILWU contract is a telling story, both about how the ILWU became such an important force on the waterfront and how the ILWU contract impacts 20% of the U.S. Trade. The genesis of the modern ILWU contract goes back to the San Francisco General Strike in 1934, when dock workers shut down the entire San Francisco Bay Area shipping industry, effectively crippling the shipments of cargo that was so vital to the influx of supplies for World War II. During the strike a group called the Waterfront Employers Association (WEA) hired professional mediators and conciliators to settle the dispute. After several months of negotiations, compromise, and back and forth the WEA and ILWU reached an acceptable general strike settlement agreement in San Francisco in July of 1934, even though some workers were still striking. Unfortunately violence erupted that June when nine striking longshoremen were killed by police and sailors, with dozens more injured during the strike which later became known as the San Francisco General Strike. Compounding the difficulties of attracting new waterfront workers was the multi-union atmosphere on the San Francisco waterfront at that time. Many different unions represented individual workers, each one vying for a piece of the pie. The multiple unions created confusion over the application of conflicting collective bargaining contracts. So, in 1937 the Coast Longshoremen’s Union #10 and the Pacific Coast Lumber Handlers’ and Hire Hand’s Protective and Benefit Association’s #7 (also known as the Woodworkers) formed the United Maritime Workers of the Pacific Coast, an amalgamated union. The ILWU was thus formed by the addition of various local unions along the West Coast with the San Francisco locals leading the way. Major ILWU contract negotiations go back to the end of World War II. As I mentioned above, every three years the ILWU convenes to negotiate a new contract. In 1943, the United States used its power to issue the Smith-Connally Labor Disputes Act that allowed for the seizure of a company’s property by the federal government. The result for the shipping industry was the seizure of West Coast docks by the U.S. Government during World War II. The ILWU emerged from the War with a strong presence. By 1948 the ILWU covered 29,000 longshoreman and professional employees, approximately 16,000 of them union members. It wasn’t until the 1950s when the ILWU signed their first agreement covering all 29,000 members in the United States. In 1971 the ILWU negotiated its first coastwide contract covering both the West Coast and Hawaii, a feat that required them to negotiate with employers in Seattle, San Francisco, Los Angeles and Honolulu. It set wage standards and clarified the union’s jurisdiction in cases of overlapping work, it also established the Coast Longshore Conference Committee, a multi-employer bargaining unit. Over the years the ILWU has made several attempts to negotiate the work rules built into the contract. Rogue waves threatening shipboard computers have challenged the contract. Labor contracts like the ILWU’s are difficult to establish in the best of economies let alone during the ups and downs of global trade and the devastating impact a tsunami has on a port.
Main Aspects of the ILWU Contract
As already noted, there are a multitude of provisions within the ILWU contract that an ILWU member must be aware of before proceeding to arbitration. These provisions concern areas such as wages, work conditions, benefits, job security, and the grievance process itself. Simply understanding how these provisions are structured and executed can be a daunting task for a new member of the shipyard unions.
For instance, the wage provision in the ILWU contract is generally a standard provision that outlines how pay increases are handled. For example, the provision may provide that annual increases are based on COLAs or cost of living allowances and include automatic step bump-ups in pay based on seniority. This provision governs raises, additional special wages, and the bonuses paid for work during holiday periods. The wage provision also governs the terms of unemployment and disability payments as well (although a member may be outside of this provision’s purview if they do not qualify for unemployment benefits).
The work conditions provision of the ILWU contract is, as its name denotes, a provision that provides for what constitutes a suitable work environment under the agreement (i.e. safe work practices, hours of work, break periods, and rest periods). Together with this provision is the provisions that govern overtime and premium pay (such as for FMAP/work on holidays or funerals), as well as the severance package for workers who are involuntarily terminated.
The benefits of the contract are governed by the health, retirement, and insurance provisions of the ILWU contract. These provisions will normally establish what costs employers must bear and what costs are to be borne by workers. A worker’s personal responsibility for premiums, etc. should all be outlined in the ILWU contract as well, with information and procedures for obtaining benefits included.
The job security provision of the ILWU contract will govern what constitutes non-discriminatory job security for all members, the right of ILWU members to be upgraded based on seniority, how pension and insurance contributions can be made, and how members can secure lost wages as a result of station closures. This provision also details how a member can contest a termination or reassignment that they believe is motivated by an illegal motivation such as age, gender, etc.
Finally, the grievance provision governs how an ILWU member may file a grievance and how a grievance may be contested by the employer. Moreover, it should detail the result of the grievance in case it is successful (i.e. reinstatement, back wages, etc.).
ILWU Contract’s Effect on the US Shipping Industry
The ILWU contract has significant implications for the U.S. shipping industry, ranging from how labor relations issues are settled to the efficiency of how ports operate and what the costs are. Companies that depend on access to a West Coast port need to be aware of what the ILWU agreement is with the employers that rely on their work, and how those agreements might change.
ILWU labor relations issues are set through a process established by the Taft-Hartley Act of 1947. Under Taft-Hartley, if any ILWU labor relations issue is not settled in 30 days of a strike or a lock-out on the waterfront or on any waterfront facility, any party can petition U.S. District Court to appoint a panel of seven members to mediate an agreement. At least three of the panel are drawn from a list of individuals the parties have selected, at least two of the panel members are public members who don’t work on the waterfront, and the remainder of the panel consists of a union representative and an employer representative. Any party can challenge the selection of a union representative or an employer representative based on neutrality and knowledge, but otherwise the process for the selection of the members is done without litigation. The federal court appoints the mediator panel, which convenes in Washington D.C. The panel can schedule hearings anywhere in the United States and its decision is binding ten days after it is made. However, the decision can be rejected by any party if they give notice to the court within those ten days — although this has not happened in recent strikes . While this process exists, strikes on the West Coast have been short and rare. The last West Coast longshore strike on a major coastwide basis occurred in 1971. While strikes have been exceedingly rare in recent decades, strikes and lock-outs still occur, albeit on a local basis. Local strikes and lock-outs can either be resolved through arbitration or by using Taft-Hartley as described above.
Some shippers have indicated that they view the ILWU as an impediment to port efficiency. They have suggested that the ILWU’s work rules and work stoppages have made the ports less efficient. In 2014, container vessel giants Maersk and Evergreen indicated that they were re-routing their vessels away from the West Coast and haven’t fully returned their routes back to the West Coast. Shippers believe that vessel calls in Long Beach and Los Angeles can be delayed by ILWU stoppages or by quirky ILWU work rules, incentivizing shippers to route their vessels to Houston or the eastern United States. Maersk has indicated that it has other options in the South Atlantic, such as the Port of Santos in Brazil.
Employers, importers, exporters and other stakeholders must be cognizant of the impact of this contract on productive capacity. They should factor this knowledge into their logistics planning. The current ILWU contract is to expire in July 2019, a full 10 months before the start of the peak season for many importers.
Latest Updates on ILWU Contracts
Recent developments in the ILWU contracts have seen a mix of negotiations, disputes, and changes. One of the most notable recent developments was in May of 2023, when ILWU Locals 4 and 40 reached a tentative agreement over safety issues and other terms. The tentative agreement covered the areas of pay, training, medical service access, and an upgrade to existing shore cranes, among other issues.
While that agreement has yet to be signed, it’s a notable step toward improved labor-management relations in the Pacific Northwest. Additional reports have indicated that the tentative agreement may also have an impact on the 2024 negotiation season for the ILWU and its industry employers.
Most recently, the ILWU and the Employers’ Association have been engaged in negotiations over the latest multi-employer contract. These negotiations began in March of 2022 and were later put on pause from June through mid-August, with both sides agreeing to extended deadlines until the latter half of 2022. The ILWU’s primary remaining concerns at this time appear to be over pension contributions for retirees and the associated funding of the plan, which is likely slated to be an ongoing issue through the remainder of these negotiations.
Late last month (October 2022), the ILWU and the Employers Association reached a tentative deal over a contract that would remain in effect until July 2025. The deal was offered to the Pacific Maritime Association membership to be ratified; however, the Employers Association rejected the terms, citing concerns over the ILWU’s demands and the potential disruption to American businesses.
The ILWU has emphasized that its contract demand have remained consistent throughout the course of these negotiations. ILWU’s current contract is set to expire on July 1, 2022, while the last multi-employer contract was set to expire in July 2024.
While no ILWU contract or dispute exists in isolation, neither do they affect all associated companies. In other words, not every ILWU contract dispute is "lit" across the board, so to speak. For example, ILWU contracts have a direct effect on employers like the PMA, who operates a longshore and marine clerical contract. In turn, that contract affects various related employers as well as the membership of ILWU Local 63, which covers longshore and marine clerical workers.
My understanding is that the current dispute between the PMA and the ILWU Local 63 centers on completely unrelated issues to those found in the ILWU Local 94 dispute.
Future ILWU Contracts
The potential change and, in particular, decline in the health of terminals could impact future ILWU labor negotiations with regard to terms such as wages and working conditions. If lost productivity is not addressed by terminals and cargo volumes continue to decline, it will be difficult for the ILWU to demand higher wages, in the face of declining margins, from employers. That said, increased automation at terminals, which could include privately held terminals, may become part of future ILWU labor negotiations as well, and not just with the employers that make up the PMA. The full extent of the impacts of automation on ILWU jobs in the future is unclear, but in the present we are in the midst of a massive move towards automation in the transportation of cargo. From these changes, new ILWU contracts may potentially become part of a public service wage and benefits structure that would apply across the board so that no terminal, rail, or trucking employer could "poach" local labor from other employers with a superior wage, salaries, and benefits package . This is seen as inevitable, due to automation, "right-sizing" in the industry, and changing cargo volumes across California’s ports as shipping companies align vessel sizes with available cargo. As more companies make shifts to automate their cargo operations, the possibility of a cargo industry that is devoid of all person-held positions, and thus a need for traditional ILWU labor contracts, become real and arguably feasible. If California ports continue to suffer because of international trade trends, and ILWU labor members become increasingly marginalized in the cargo supply chain, then ultimately the ILWU labor contracts will need to be reexamined so that they are at the forefront of meeting the ever-changing needs of the modern transportation industry.