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Dockworkers at Northwest ports reject pact offer

By Laura L. Myers

SEATTLE (Reuters) - Dockworkers at four U.S. Pacific Northwest ports moved closer to a possible labor clash with grain shippers on Monday, as parties in a larger, separate dispute at 15 East and Gulf coast ports agreed to mediation ahead of strike deadline set for December 30.

The International Longshore and Warehouse Union (ILWU) announced nearly 3,000 of its members had voted to reject a contract proposal that management called its "last, best and final" offer.

The proposed contract covers six of the nine grain terminals operating in Puget Sound and along the Columbia River that account for more than a quarter of all U.S. grain exports and nearly half of U.S. wheat exports.

The stalemate in contract talks in Oregon and Washington state and management's failure to win approval of its offer, fueled speculation that grain shippers might impose a lockout of union members in a bid to keep terminals operating with replacement workers.

The ILWU has not asked its members to authorize a strike, nor has it set a strike deadline or made mention of a walkout. The union urged the shippers to return to the bargaining table.

Talks have foundered over numerous work-rule changes sought by the companies to improve efficiency, but opposed by the ILWU as onerous give-backs ultimately designed to break the union.

The Pacific Northwest Grain Handlers Association, which represents the shipping companies and the grain terminals they own, said in response to rejection of their contract offer that employers were "reviewing their options."

The ILWU has said the shippers have hired a Delaware-based company that specializes in providing security and replacement workers in labor disputes.

The U.S. Coast Guard said last week it was preparing to establish buffer zones to keep union-related protests from interfering with navigation around two of the ports seen as most likely to be caught up in waterborne labor unrest.

The possibility of a labor showdown in the Northwest is just the latest in a series of union disputes to hit U.S. ports.

The U.S. Atlantic and Gulf coasts are bracing for a strike threatened for December 30 by nearly 15,000 union dockworkers unless shippers extend their contract.

Major sticking points to a settlement there include the future of so-called "container royalties" earned by union members based on tons of cargo moved through a port, and eight-hour workdays guaranteed under the current contract.

In a potential breakthrough on Monday, the U.S. Federal Mediation and Conciliation Service said the agency had called a meeting of the two sides in the East Coast dispute and both parties had agreed to attend.

Two days of federally mediated talks in the Northwest dockworkers dispute earlier this month failed to produce an accord. A counter offer presented by the union was rejected by management on December 17.

Only weeks ago, harbor clerks and union longshoremen staged an eight-day walkout in Southern California at the twin ports of Los Angeles and Long Beach, idling much of the nation's busiest cargo-shipping complex.

SHIPPERS SEEK WORK-RULE CHANGES

In the Northwest, the ILWU has accused management of bargaining in bad faith, citing 750 changes it said the companies were seeking to impose on labor contract terms that have stood for more than 80 years.

The shippers said the dispute centers on proposed work rule changes aimed at making their terminals more competitive, such as allowing fewer employees to load ships, allowing elevator workers to assist in ship loading and greater management discretion in hiring and staffing decisions.

"Regardless of the outcome, they (the companies) remain committed to operating" the terminals, the Grain Handlers Association said in its statement.

Votes management's latest offer were cast Friday and Saturday by union members in Portland, Oregon, and in Seattle, Tacoma and Vancouver, Washington. According to the final tally announced on Monday, 93.8 percent of those voting disapproved the proposal, as recommended by union leaders.

SWITCHING FROM BARGES TO TRAINS?

Waterfront labor strife in the Northwest would compound an existing slowdown in U.S. grain exports caused by the low water on the Mississippi River by making it harder for shippers to meet expectations set by the U.S. Agriculture Department, said Bob Utterback, of Utterback Marketing Services, a brokerage for farmers.

Pendleton Grain Growers, for example, the largest cooperative grain dealer in Oregon, will likely overhaul its shipping plans to send more wheat, corn and soybeans to ports via railroad instead of barges, said Jason Middleton, director of grain operations for the cooperative.

Such a switch could slow shipments, most of which normally are sent up the Columbia River en route to Asia.

Utterback said the soybean market already is on edge over weakening demand following recent cancellations of purchases by China, a top importer. Other grain dealers said they saw little effect on prices absent a prolonged labor clash, lasting at least two or three weeks.

The old contract for dockworkers at the six terminals expired on September 30, but under terms that remain in effect for the time being, regular work shifts for ILUW members ended at 3 p.m. local time Monday, and union workers have the day off on Tuesday for the Christmas holiday.

The shipping companies say they are seeking the same workplace rules and terms the union had agreed to after lengthy and contentious labor talks with EGT, an exporter that opened a new terminal last year in Longview, Washington.

(Reporting by Laura L. Myers in Seattle; Additional reporting by Christine Stebbins and Tom Polansek in Chicago, and Teresa Carson in Portland, Ore, Sam Forgione in New York.; Writing by Steve Gorman; Editing by Bob Burgdorfer, Leslie Adler and Michael Perry)

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