PortMiami administrators are on edge as the nation’s 14,650 longshoremen threaten to shut down the giant gantry cranes used to ship containers at 15 major East Coast ports at midnight Saturday. The job action portends a potential blow of tens of millions of dollars a day to Miami-Dade County’s economy.
PortMiami, the nation’s 11th-largest shipper of containers, does almost $20 billion a year in container business. Any shutdown is not expected to affect cruise ships.
“It’s not a good thing,” said PortMiami Director Bill Johnson, who gathered with staff Friday to discuss the looming shut down. “Ninety-percent of what Americans consume arrives by water. Within a few days it could mean a major disruption throughout the entire U.S.”
At Fort Lauderdale’s Port Everglades, spokeswoman Ellen Kennedy said the department is stepping up security and preparing First Amendment zones in anticipation of picket lines.
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“We’re very concerned about it,” she said. “We want to make sure operations continue for those not affected.”
A strike would have far less impact in Broward, which has only two container transport companies that employ longshoremen. Miami has several more, including world leader Maersk. All together, they employ “hundreds of workers” — though local International Longshoremen’s Association offices and PortMiami officials could not give an exact figure.
Johnson said a strike would affect far more than the 6,000 workers at the port, putting a virtual halt to one of the largest economic engines in the county. His office has little in the way of a contingency plan should the longshoremen walk out Saturday night.
“To work the gantry cranes takes an incredible amount of skill and years of experience,” he said. “There’s potential loss of life and property. A strike is not something we want.”
Late Friday, Gov. Rick Scott got involved, sending a three-page letter to President Barack Obama asking that he invoke the Taft-Hartley Act if a strike occurs, which would mandate an 80-day cooling off period, and force mediation. “The predicted effects of a strike on the state of Florida would be devastating,’’ wrote Scott. “Cargo-related activity at Florida seaports curently generates more than 550,000 direct and indirect jobs in Florida, and contributes approximately $66 billion in economic value to Florida’s economy.’’
Johnson said cargo operations are about 40 percent of PortMiami’s business. Kennedy said cargo makes up almost a third of Port Everglades’ business, but as only the two container shipping companies use the longshoreman’s union, the amount of business affected would be much lower.
The ILA and shipping company representative the U.S. Maritime Alliance have been trying to bang out a contract since March.
A recording at the New Jersey headquarters for the Maritime Alliance said CEO James Capo was recovering from surgery Friday.
Also Friday, the Wall Street Journal reported that Capo refused comment but had earlier stated he was “disappointed” at how inflexible the unions were acting. The paper also quoted ILA union spokesman Jim McNamara saying there was still time to reach a settlement, “but obviously, it’s very, very short.”
The National Retail Federation, meanwhile, sent a letter to the White House warning of the possible devastation a strike could yield. According to the Journal, the trade group has asked the president to use all means necessary to resolve the standoff, including ordering an 80-day cooling off period and ordering mediation if the sides don’t come to an agreement.
In some cities, container operators were making contingency plans. In Philadelphia, customers were being asked to ship as many goods out as soon as possible. The companies are also extending shipping hours. Representatives of the local offices of PortMiami’s two largest container companies, Maersk and Mediterranean Shipping Company, did not return calls.
A man who answered the phone at Miami’s ILA Local No. 1416 declined to answer a reporter’s questions and hung up the phone. Calls to the union headquarters in Bergen County, N.J., went unanswered.
According to a memo issued last week by the president of the ILA, items likely to be affected by the strike are nonperishable and frozen goods like clothing and some types of fish that have a shelf life in a container. If ordered to do so, the memo reads, union members must handle and ship perishable commodities like fresh fish and flowers, military cargo and mail. Items like cars that don’t go in containers will also be shipped.
The major remaining sticking point in the contract dispute: royalties, or bonuses, paid to longshoremen for every container loaded onto a cargo ship.
The longshoremen say the bonuses are essential and in some cases supplement their income by up to $50,000 a year. Longshoremen typically earn between $50,000 and $100,000 a year, depending on overtime. Major shippers like Maersk argue the skyrocketing royalties are greatly hindering profit margins.
Royalties were first introduced to ILA members in the late 1960s as a way to protect union workers after the introduction of automated cargo. The two sides have exchanged proposals on a new six-year contract, but they appear stymied over the royalty issue.
As landlords of the property, the port authorities across the nation don’t actually have a seat at the negotiating table. But there is local representation from container companies that lease space at the port.
Representatives of two container companies — PortMiami Terminal Operation Co. general manager Carlos Arocha, and Mark Baker, who manages South Florida Container Terminal — are taking part in the negotiations. They referred questions to the U.S. Maritime Alliance for comment.