Del Monte Terminal Shift Threatens ILA Control

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

31 Aug 2010

In a sharp blow to the International Longshoremen's Association, Del Monte Fresh Produce is planning to shift its shipments of half a million tons of bananas on some 75 ships annually from the Port of Camden, N.J., farther down the river to Gloucester Terminals. Del Monte is one of the largest employers of union members in the ILA on the Delaware River. Gloucester Terminals does not use ILA labor.
The move, which was reported by the Philadelphia Inquirer on Saturday, is seen as a major blow to the ILA, which says it will lose 200 to 300 jobs, or 400,000 ILA labor hours a year.
Workers at Gloucester Terminals are members of the International Dock Workers Union No. 1, a Teamsters local, or the International Association of Machinists.
Del Monte’s move is likely to ignite a firestorm on the river, as the ILA, which controls most of the labor at terminals in New Jersey and in Philadelphia is certain to fight to maintain its control.
Although Del Monte's lease with the South Jersey Port Corp. in Camden does not expire until 2020, its labor agreement with Delaware River Stevedores, which employs ILA workers in Camden, expires at the end of this year.
Del Monte had asked DRS and the longshoremen's union to come up with about 25 percent, or roughly $5 million, in wage savings, Robert Palaima, president of Delaware River Stevedores, told the Inquirer.
Del Monte also asked South Jersey Port Corp., which runs the Broadway and Beckett Street Terminals in Camden, to come up with changes.
"Both South Jersey Port and the ILA delivered big-time with a concession package," said Palaima, who received formal notice Friday that Del Monte will move in October to Gloucester marine terminal, owned by Holt Logistics, a major operator of terminals on both sides of the river.
Leo Holt, whose family also runs Packer Avenue Marine Terminal in South Philadelphia, said Del Monte's move had "nothing to do with labor, and everything to do with having a facility that is up to the modern levels of capacity and abilities" Del Monte needs.
Vessels entering and departing the pier at Camden's Broadway Terminal must be accompanied by two tugboats, and they are restricted by the Coast Guard as to times they can go in and come out of the berth, Holt said.
"At Gloucester, they will use one tug to dock, and none to depart," he said. "This reduces expense 52 weeks a year as it relates to tugboats. It boils down to technology. It's about a modern facility and opportunity for growth."
James Paylor, an ILA vice president, told the Inquirer that Holt's labor rates are "inferior" to area and industry standards. "They have some employees at $16 or $17 an hour with some benefits, but others work for $12 an hour and have no benefits," Paylor said. "Unheard of in our industry."

Source: Journal of Commerce Online