Trudeau's Labour minister gives mediator '24 hours' for terms to end B.C. port strike

Ottawa has given a federal mediator 24 hours to find terms to resolve the B.C. port strike and simmer the supply chain chaos.

Since July 1, about 7,400 members of the International Longshore and Warehouse Union (ILWU) Canada have halted critical shipments at about 30 ports along the west coast.

Economist Jim Stanford, director of Vancouver's Centre for Future Work, rejected claims that longshore workers "are greedy and resistant to change." 

However, federal Labour Minister Seamus O'Regan clarified that the gap between employers and port workers is "not sufficient to justify a continued work stoppage."

"It is in the interest of everyone — the employer, the union, and all Canadians — that they agree to that deal as soon as possible," he said.

The on-job action by workers stems from concerns about outsourcing and automation and what that means for their job security. Additionally, they want higher wages.

While the hourly wages for the 7,400 longshore workers are similar to wages for other skilled industrial jobs, their wages lagged behind B.C.'s rising cost of living. Stanford claimed longshore wages had fallen 2.5% since 2017.

However, the B.C. Maritime Employers Association says the median salary for a union longshore worker is $136,000 a year, plus benefits. It notes there has been a 10% wage increase over the last three years since the start of the pandemic.

"The greed of shippers and terminal operators, who took advantage of an economic and health emergency to fatten their bottom lines, is the source of the problem," said Stanford in a study commissioned by ILWU Canada.

He contends that six shipping companies control 70% of world shipping, giving them considerable influence over prices and practices. 

Per publicly available financial information for five companies, they earned over $100 billion in profit last year.

John Coray with the Freight Management Association of Canada concurred that supply chain disruptions could increase consumer prices.

He maintains the port yards will be packed in the coming days. "Then, the next step is they're going to have to shut down plants, whether it's a sawmill or a mine," he said.

"This is terrible for those companies because they are shut down; second, workers who work there are essentially laid off — they're not going to pay them while that's happening."

"Clearly, labour is not the source of rising costs in marine shipping and the resulting inflation," added Stanford.

The provinces of Alberta and B.C. also commented on the chaos caused by the strike, with B.C. Premier David Eby called the ongoing situation a concern for all provinces.

"All of us are unified in the goal that this gets resolved as quickly as possible, as knock-on impacts on the cost of living for people across the country as goods get more expensive because imports are unavailable," he said Tuesday at a meeting of provincial leaders in Manitoba.

Alberta Premier Danielle Smith said her province appreciates the efforts of Minister Seamus O'Regan to "advance his authority under the Canada Labour Code." She is hopeful this action will produce a settlement in the next 48 hours. 

"Alberta is a land-locked province that relies on the safe, dependable movement of goods to and from British Columbia ports," added Devin Dreeshen, Alberta's economic corridor minister.

"Each day this labour disruption continues will have an increasingly severe impact on the livelihoods of Albertans, Canadians and Canadian businesses who rely on the safe and efficient flow of the supply chain."

Canada ships about $800 million daily through west coast ports, representing a quarter of the country's exports. "Although it's not good for consumers and importers, it's even worse for exporters," explained Coray.

According to the Canadian Federation of Independent Business (CFIB), 53% of business owners believe the strike will impact their operations. Three-quarters of businesses want the feds to pass back-to-work legislation to end the strike promptly.

CFIB president Dan Kelly articulated the latest supply chain disruption is hitting businesses "extra hard" after beginning to recover from the COVID pandemic.

"We're hearing from members across the country who are worried about missing critical sales, delayed production or orders or an inability to get their products to export markets because of the strike," he said, urging Ottawa to act "as quickly as possible."

O'Regan said Tuesday evening that both sides "have worked long and hard to negotiate a deal." Upon receiving the terms from the mediator, he will forward them to both sides, who will have another 24 hours to accept the deal. 

Coray said that every day the strike continues costs another week of recovery time for port supply chains. If the strike ends today, they will take until October to return to normal.

"The scale of this disruption shows how important the relationship between the BCMEA and the ILWU is to our national interest," added O'Regan. "We cannot allow this work stoppage to persist and risk further damage to the relationship between these parties."

"Even with the anticipation of a strike, there's disruption because shippers don't want to be caught up when the strike happens," explained Coray.

"These goods are not going to the destination they were promised to, so we now have a reputation problem for Canadian producers where people around the world start thinking this is an unreliable source, and they start looking for other ways to fill their demand."

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