The longshoremen’s union has struck a deal over healthcare with container terminal operators as part of broader negotiations over a labor contract.

Agricultural exporters are watching the talks closely because disruptions at container terminals would affect their competitiveness in overseas markets.

While the tentative agreement over health benefits resolves an important point of contention, it doesn’t necessarily mean that the overall labor contract discussion is going smoothly, experts say.

A previous contract between the International Longshore and Warehouse Union and the Pacific Maritime Association, which represents terminals at 29 West Coast ports, expired at the end of June.

Longshoremen have agreed to abide by that agreement while negotiations continue.

The recent deal over healthcare is a sign that ILWU and PMA are taking a “building block approach” to negotiations, in which an element of the contract is settled separately from the overall deal, said Michael LeRoy, a law professor specializing in labor relations at the University of Illinois.

“This is a fairly common practice that parties use to gain momentum toward a larger agreement,” LeRoy said. “It sort of breaks the negative inertia of saying no to each other.”

Mediators often use the technique during an impasse in negotiations, so it may be a sign that the longshoremen’s union was having difficulties in talks with the terminal operators, he said.

The terms of the health benefit arrangement were not disclosed, but it won’t be effective until an agreement is reached on the overall contract.

The question of healthcare was expected to be a major point of debate, as “Obamacare” reforms placed new taxes on premium health plans such as those enjoyed by unions.

The ILWU and PMA may have arrived at a substantive agreement on the matter of paying those taxes, or they may have elected to keep the status quo until the taxes take effect in 2018, said Peter Friedmann, executive director of the Agriculture Transportation Coalition.

“It’s unclear exactly what they agreed to,” he said. “They could have kicked the can down the road.”

While it’s good news that longshoremen continue to work without a contract — rather than disrupt port functions — it’s unusual that the situation has continued for more than two months, Friedmann said.

The lack of a contract is worrisome, however, due to the lack of a contractual dispute mechanism that can resolve conflicts between longshoremen and terminal operators, he said.

Usually, an arbitrator can settle disputes and prohibit local ILWU organizations from walking off the job, but without a contract that process is null, Friedmann said. “There’s no mechanism to return people to work.”


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