Key ILA local at port OKs buyout agreement

August 20, 1994|By Suzanne Wooton | Suzanne Wooton,Sun Staff Writer

Employers at the port of Baltimore have reached a historic buyout agreement with a key group of longshoremen to end the longstanding program that pays them when they are not working.

Although yesterday's $3.2 million agreement covers only about a fifth of the port's 1,600 longshoremen, it could signal a first step

in scrapping a program long considered a stumbling block in the port's efforts to regain business.

"This agreement will improve the port's ability to compete with other ports up and down the East Coast," said Michael P. Angelos, executive director of the Maryland Port Administration, which operates the state's five public marine terminals.

Under the plan -- announced jointly by the Steamship Trade Association and Local 953 of the International Longshoremen's Association -- up to 50 members will retire Oct. 1 and receive $65,000 each.

In exchange, members of Local 953, representing 350 clerks and checkers who process cargo, will give up their rights to draw any money from the Guaranteed Annual Income (GAI) fund, long considered a sacred cow by labor.

Maurice C. Byan, president of the steamship trade association, called the agreement "another milestone in the rebuilding of labor-management relations in the port of Baltimore." The association, which represents steamship lines and stevedore firms, has been trying for more than a decade to eliminate the GAI.

Thus far, none of the port's 1,250 other longshoremen, represented by four other ILA locals, have agreed to negotiate with the employers group on the GAI issue.

The majority of Baltimore longshoremen drawing GAI benefits are cargo handlers, who are members of Local 333. Mr. Byan said yesterday other longshoremen had refused to consider a "similar" deal.

"We're hopeful that they will agree to negotiate with us," he said. Representatives of the other locals could not be reached for comment yesterday.

What makes the agreement all the more symbolic of changing labor relations at the port is that it was negotiated with Local 953 President Richard P. Hughes Jr., a one-time firebrand who led several bitter strikes at the port in the early 1990s.

But, in the more conciliatory tone he has used lately, Mr. Hughes said yesterday:

"In order to stay competitive, the port has to reduce its overall costs. Sooner or later we'd be out of work."

Mr. Hughes said the retirement of 50 workers would free up jobs so that almost all members of his local will be employed. "It increases seniority for everyone," he said. "It's a win-win situation for everybody in the local."

In recent years, as labor-management relations have improved, more steamship lines and cargo have been coming to the port of Baltimore, providing more work for longshoremen. And Mr. Hughes said the combination of the increased work and the attractive buyout offer prompted his members to embrace what once would have been unthinkable.

"The opportunity presented itself and we seized upon it. I believe we made the right decision," he said. "I didn't think it [the GAI] was going into infinity."

Members of Local 953 voted 257-to-31 on Thursday to accept the deal.

For the checkers and clerks, the danger lies in the possibility that work will fall off significantly, leaving them with fewer jobs.

"That always scares you," Mr. Hughes said. "That's the chance we're taking here."

Adopted more than two decades ago, the GAI program is intended to compensate eligible workers for jobs and wages lost because of automation. Since the 1970s, the number of longshoremen jobs has dwindled from 5,000 to 1,600.

Payments from the fund ensure that each eligible worker will make $30,000 a year, about half of what a dockworker with top seniority could earn by working full time. Some 500 workers are currently receiving at least some GAI benefits.

The plan is financed through a $4-per-man-hour assessment on steamship and stevedore companies -- costing them roughly $10 million a year.

Because those costs have been passed along to customers using the port of Baltimore, the program has been criticized for making the port of Baltimore less competitive.

"This ultimately will result in a savings to the customers of the port," Mr. Byan said.

The subsidy programs, adopted during the 1960s and 1970s at most Atlantic and Gulf of Mexico ports, have been phased out at most ports. Most recently, the ILA leadership in Philadelphia agreed to suspend the GAI program for a year at that port, which was losing work to Wilmington, Del.

Only the ports of Baltimore, New York and Boston are paying GAI benefits.

The agreement announced yesterday in Baltimore is a one-time offer by the employers association and applies only to the 50 eligible union members.

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