Ports dispute could be just beginning

a commercially devastating stalemate looms

As the bitter employer versus employee dispute on Auckland’s waterfront enters its seventh month there are echoes of the infamous 1951 waterfront battle.

The 1951 lockout lasted for 151 days and came about when the Arbitration Court awarded a 15% wage increase to all workers covered by the industrial arbitration system.

It did not apply to waterfront workers, who were offered 9% by the shipping companies. In protest, the watersiders refused to work overtime and were promptly locked out. At its height more than 20,000 workers went on strike in support of the watersiders.

The current Maritime Union and Ports of Auckland (PoAL) dispute pits employers’ desires for increased commercial productivity against a unions’ fights to guarantee members’ job security under a collective employment agreement (CEA).

Central to the dispute is the 12% return target demanded from PoAL by the Auckland Council. PoAL is wholly owned by Auckland Council Investments, which in turn is a wholly owned subsidiary of the Auckland Council.

To achieve its target PoAL says it needs a more flexible workforce, but the union rejected an offer for a 10% wage increase with a fully flexible workforce.

After unsuccessful negotiations, during which the union rejected a 2.5% wage increase with a rollover of the existing CEA and no changes to the terms and conditions, PoAL made 292 jobs redundant - including 235 union members - and introduced competitive stevedoring at its Bledisloe and Fergusson container terminals.

The contracting out process has since ground to a halt after several injunction hearings at the Employment Court, the latest of which stayed the process until a five-day substantive hearing set for May 16.

Employment Court judge Barry Travis determined this week the union has a seriously arguable case that the PoAL decision to contract out has undermined collective bargaining.

The union’s biggest gripe has been PoAL’s reluctance to guarantee work hours for its members.

On March 9, PoAL signed contracts with labour hire firms Allied Work Force and Drake New Zealand as two of three companies to introduce competitive stevedoring. These arrangements are now on hold.

The cost to PoAL of the redundancies is said to be $11.5 million. 

Strikes began on December 1, since then industrial action has been ongoing. The final and most recent strike ran for several weeks as hostilities peaked.

Union members blocked the ports main entrance and accosted employees of nearby restaurant Mikanos, banging on a car roof and hurling abuse at one female employee.

At a March 21 judicial settlement conference at the Employment Court. PoAL agreed to halt the contracting out process for four weeks and return to mediation.

The day after, the union lifted its strike expressed a desire to return to work but PoAL issued a lockout effective on April 6 and told the union any return to work would have to wait at least a week because shifts were scheduled a week in advance.

Accusations of bad faith bargaining have flown back and forth between the two parties.

The union hotly contested details released by PoAL of workers pay audited by Ernst & Young.

The figures show the average stevedore earned $91,000 a year and the highest paid stevedore earned $122,000 a year. The figures also showed for every 40 hours paid only 26 were worked.

Union national president Garry Parsloe says for a worker to earn $91,000 a year they would be required to work an extra 1337 hours a year on top of a 40-hour week.

But NBR Online revealed a number of allowances were paid to PoAL stevedores. Some sstevedores receiving up to 20 allowances could add $40,000 a year to a base wage of more than $60,000.

Allowances included $42.40 for each night shift, $8.53 a shift for meals as well as production bonuses and briefing time- time taken at the start of a shift to brief workers on the shift ahead.

Relations between the two parties soured further when employee details were leaked to blogsite Whaleoil and NBR Online revealed details of union members disciplined by PoAL during the bargaining process.

PoAL in turn have accused the union of breaching Employment Court orders by releasing media statements detailing what happened inside the courtrooms.

Trade disruptions have also hit the port as a result of the strikes with the loss of Fonterra exports and shipping company Maersk's Southern Star line.

The combined annual revenue loss to PoAL was $25 million and the total annual revenue loss was more than $32.7 million and growing mid-way through March.

The loss of the Southern Star line to Tauranga in December meant PoAL lost 52 ships and 123,600 twenty-foot equivalent units and the annual revenue loss was estimated to be between $20 million and $22 million.

Fonterra moved its exports to Napier and Tauranga in January and the port estimated the annual loss $3 million.

The combined revenue loss caused strikes up to March 23 was $7.7 million.

PoAL ceo Tony Gibson says the moves were a direct result of the union's ongoing industrial action at the port.

Supporting pickets appeared in Tauranga, Wellington and Lyttleton as union members refused to work ships serviced by non-union employees at Auckland.

Port bosses quickly sought inunctions ordering workers to service the ships. Support on the ground began to thin when it become clear conditions being offered to the union workers were nearly identical to those at other ports across the country.

Costs to the wider economy have been harder to quantify but are becoming apparent as trade statistics are released.

Merchandise trade statistics for February show exports fell by $267 million from February 2011 and Statistics says it was likely a direct result of the stoush between PoAL and the union.

National Road Carriers chairman Chris Carr says there have been significant productivity losses within the industry.

John Albertson, chief executive of New Zealand Retailers Association, says inevitably increased costs would be passed onto the consumer.

“My understanding is that so far, most retailers, be it food or clothing, have been able to keep the shelves stocked. They are running thin on some lines at the major distribution centres,” Mr Albertson says.

The Council of Trade Unions also weighed in and its president Helen Kelly says she could not rule out a return to the days of employer militancy of the 1990’s when employees had their rights stripped from them.

Another branch of the dispute has been central and local government standing on the sidelines. Calls for the involvement of Auckland Mayor Len Brown have been ignored and a number of statements from the council have shovelled responsibility from the council.

In one statement Mr Brown says his power to intervene is severely limited by legislation surrounding the port but Auckland Council wholly owns the port.

Labour Minister Kate Wilkinson says the government had watched from the sideline and has not been asked to intervene.

Ms Wilkinson told an industrial and employment relations conference in Auckland the government had appointed the Department of Labours chief mediator to work with the parties and it was disappointing a resolution had not been reached.

NBR Online readers have called for employment law to be changed, saying unions could effectively hi-jack a business and created a gravy train for lawyers.

Some say employment law is embedded in the 19th century and needs to be brought up to date. Readers accuse both sides of holding the economy to ransom.

In a desperate attention-grab, union members who support the Breakers basketball team said they were happy the arrival of "thundersticks" were not affected by the strike.

It is clear the wharfies dispute will not be resolved easily.

It has all the hallmarks of a turning tide in generally peaceful labour relations as unions signal their determination to return to worker domination of essential industries.

And while claiming not to be on strike the union’s picket remains in place as a commercially devastating stalemate looms.  [UPDATE: For the latest developments, read Ports of Auckland lifts lock-out amid board rift]

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21 Comments & Questions

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Perhaps employers want workers to wear cloth caps and doth them while paying the boss 50 cents for the 'privilege' of allowing them to work.

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no one owes anyone a job, and no employee owes an employer 8 hours of their life - resign and leave, life is too short and unfulfilled if you are forever forcing people to act and do things they don't want to

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1951 - Go do some reading about that whole terrible event. Ordinary people, families had their homes raided by police because they had some union literature.1951 strikes were was caused by shipping the shipping companies of the day. Go read about it.
So until you do your homework don't discuss such events

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Mathew 12:25
Mark 3:24-25
"A house divided against itself cannot stand"
Snap out of it Auckland. This cat fight is just entertainment for most people.You are making fools of yourself. The truth hurts.
What is Poverty?

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you are living in a dream world , you are so disconnected from reality that it is any wonder that are able to think for yourself. United Nations wrote a harshly critical analysis of current NZ living standards and the fact that poverty has increased like never before under National led coalition - has this escaped your attention? John Key even admitted the widening gap between the haves and have nots under his party. Wake up.

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Mr. Key should lead by example if he wishes to comment. He suffers corprate greed, so you have destroyed your case. Personal criticism does not enhance your image either. "Checkmate"

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you expect demanding an employer to pay you more is going to work in the long term? you are kidding yourself! Get the entire population of NZ to pay more for everything and then wages will increase, more jobs for all but the sad truth is people want bargains ( The Warehouse, Bunnings etc ) The country is eating itself, but everyone complains?? Read Economics for dummies before you make retard comments

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Yes read about the Lockout in 1951,no mention of the waste of Ratepayers money to fight the workers,or the pay that Gibson and Pearson earn,go read the Bill of Human Rights while you are at it.I challenge you to put the facts that,most of the workers of this Country are underpaid,Not the Wharfies "overpaid"

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Envy is deep. There will always be someone better off than you. The grass is always greener on the other side of the fence. If you were paid $700,000/yr, do you think you would be happy? The people constantly complaining should try God's Peace. It is something different, deeper, life long. Make the people around you happy. Consider other people. Have the courage to Be different. Christ died on the cross for you.

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Damned sick of hearing government bleat on about taxpayers tightening their belts when government (local and central) think that taxes are for their private and exclusive use. Ports of Auckland executives are no better - lame. Perhaps holistic job performance based pays should be enforced. Make it standard that executive wages are dependent upon practicable sustainability which includes worker stability (job safety, low staff turnover, regular hours, decent income and longterm employment) alongside profit. A happy worker is a productive worker - a happy executive is usually an overpaid one.

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"It is clear the wharfies dispute will not be resolved easily."

WHARFIES dispute?

Sorry, was there only one party to this dispute??

I suggest a fairer term might be "Port Dispute" - as there are two parties to this issue, not just the workers.

By the way, the recent Employment Court judgement suggests that suggest that Port workers have an "arguable case". POAL have been less than good-faith negotiators in this dispute.

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The battle here does of course go much deeper; it is the eternal battle between right and left that has been raging for a long time.
Thank goodness Helen Klark is not the prime minister; at least with John Key there is some hope of a fair outcome.
WG

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On the other hand 12% for a port seems high; it could help if the port company spelt out how they arrived at this figure.
WG

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Just remember national business review, a happy work force is a productive work force. Claw backs on NZ workers working conditions by employers will not be not helpful. I dont want to see another repeat of any of the waterfront disputes from the past, but if it happens again, it wont be hard to chose which side I will be on.

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This is based on corporate,local and central government greed.Enough is never enough for these people.We need to remove the greed driven people and replace them with shift workers,who appreciate a days work for what it is.A man putting in the hard work and hours to support his family.Its far past time the people of this country gave these greedy leaders a message they wont soon forget.A message that makes it very clear we have had enough.They need to start cutting their cloth to fit,if you cant afford a multi billion train set then dont turn around and demand outrageous greed driven returns from companies that are happy to screw their staff over to feed that greed before actually applying themselves to the problem and making real positive gains with a happy productive non hostile workforce.The hostility on this port will now carry on for years,perpetuated by a greedy council and an out of touch management who have no guts to stand up and do the right thing.As a ratepayer I am ashamed at what my council is doing on my behalf.

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WG @1:18;; it is the Auckland City Council -read Len Brown who told the Port Management that the Council requires a 12% return from the Port.
Len so badly wants his train set and tunnel.
The union stance, and media reporting in general, is about brainwashing the masses for the 2014 election. They so want a pliant weak Socialist got. with its bottomless trough of Welfare Handouts. Soetging that NZ can I'll afford, after the mismanagement of the Clark. Government.

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And whats wrong with paying a guy a little extra to work nights?.When his family is at home having dinner around the table he is out in the pouring rain unloading containers!!..And a meal allowance?.I dont have an issue with that either,youre asking people to work through at a time when most people,management included are at home around the family dining table,having some goof family time together over a feed.You cannot compensate for that with money,however you can acknowledge that the guy is doing a job out of normal working hours and in doing so pay some small token towards his gesture of being available to work,rather than just forcing people to work anti social hours for no acknowledgement at all.Some of you 9-5ers should walk a mile or two in a long term shift workers shoes.You have no idea the stresses imposed on shift workers!!..None at all.

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Sell the Port to the private sector and get the council/government the hell out of there in any way shape or form-the hidden costs to the tax payer are huge and the money from the sales and lease back to the private sector could go a long way to education , health and housing for the less fortunate

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What a bunch of weirdos.

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NBR could be investigating why the Chair /CEo despite their self accalimed experience still cannot negotiate intelligently and how much has this caused the shareholder?

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it seems the the union got theri people to start post comments. it is this obvious.

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