U.S. Labor Secretary Joins West Coast Port Talks

U.S. Labor Secretary Tom Perez on Tuesday urged shipping company executives and union leaders for 20,000 dockworkers to settle a contract dispute that has led to months of clogged cargo traffic and other disruptions at 29 West Coast ports.

Perez was sent to join the talks in San Francisco by President Barack Obama, who has come under mounting pressure to intervene in the labor conflict that has rippled through the commercial supply chain across the Pacific and by some estimates could ultimately cost the U.S. economy billions of dollars.

His arrival came as several of the busiest West Coast ports, closed to incoming cargo freighters during the three-day holiday weekend, reopened in full for about nine hours on Tuesday, then suspended vessel loading and unloading again for the night.

Perez met separately with each party, then met briefly with both sides together, and further sessions were expected on Wednesday, sources familiar with the situation told Reuters.

"Secretary Perez made clear that the dispute has led to a very negative impact on the U.S. economy, and further delay risks tens of thousands of jobs and will cost American businesses hundreds of millions of dollars," Labor Department spokeswoman Xochitl Hinojosa said in a statement at day's end.

Perez urged the parties "to come to an immediate agreement to prevent further damage to our economy," she said.

The International Longshore and Warehouse Union, representing 20,000 dockworkers, and the bargaining agent for shippers and terminal operators, the Pacific Maritime Association, have declined public comment since agreeing last Friday to honor a news blackout requested by a federal mediator.

The PMA previously said negotiations hit a snag over a union demand for changes in the system of binding arbitration of contract disputes. The union has insisted an accord is near.

Labor law experts said Obama has few other options at his disposal to spur a breakthrough in talks, which have dragged on for nine months amid worsening cargo backups and curtailed port operations that the two sides have blamed on each other.

And it was not clear what Perez could bring to the table besides the symbolic weight of Cabinet-level involvement.

DISRUPTIONS CONTINUE

Operations to load and unload cargo vessels at West Coast ports, which handle nearly half of all U.S. maritime trade and more than 70 percent of imports from Asia, were halted through the holiday weekend, before resuming during the day on Tuesday.

It was the longest such disruption to date in the labor dispute. Vessel operations were likewise ceased through last weekend, and again last Thursday, a union holiday.

At the ports of Los Angeles and Long Beach, night vessel operations were suspended again late Tuesday, as they have been nightly since the companies started canceling late shifts on Jan. 12 to focus on daytime work.

The same has been true since December at the ports of Oakland, California, and Seattle and Tacoma in Washington state.

Daytime work has continued throughout in the dockyards, rail yards and terminal gates. Some smaller ports remained open to night-time vessel operations as well.

A domino effect has cascaded through the U.S. economy, extending to agriculture, manufacturing, retail and transportation.

California farmers have been especially hard hit, with port disruptions posing a major barrier to perishable goods headed to Asian markets and export losses estimated to be running at hundreds of millions of dollars a week.

Japan's Honda Motor Co said on Sunday it would slow production for a week at three North American plants due to delays in parts shipments from Asia. Other automakers say they are switching to higher-cost air freight to minimize slowdowns.

The union has denied orchestrating work slowdowns, as the companies have charged. Union officials fault changes in shipping practices the carriers themselves have instituted and say that curtailing port operations has only worsened matters.

The last time contract talks led to a full shutdown of the West Coast ports was in 2002, when the companies imposed a lockout that was lifted 10 days later under a court order sought by President George W. Bush under the 1947 Taft-Hartley Act.

Retail and manufacturing executives have projected that a full, extended shutdown of the ports now could cost the U.S. economy some $2 billion a day.

Invoking Taft-Hartley would be a long shot under current circumstances, said Daniel Mitchell, professor emeritus for management and public policy at the University of California, Los Angeles.

Obama would need to convince a federal judge that there was a work stoppage - not just a slowdown - stemming from a labor dispute and that it posed a national emergency, rather than an inconvenience to industry, Mitchell said.

 

Reporting by Steve Gorman