SUP BULLETIN: PENSION SET TO INCREASE ON JULY 1, 2020
See details below and in the June and July issues of the West Coast Sailors
PRESIDENT/SECRETARY-TREASURER'S REPORT – JUNE 2020
The first wave of COVID-19 reached a hoped-for turning point and states and cities began to re-open -- despite a serious spike in cases -- and just as a massive wave of both peaceful protest and violence followed George Floyd's terrible death in the custody of police. The SUP began a phased-in approach to a return to limited normal operations while progress on maritime labor's virus response agenda was made almost across the board. There were COVID testing improvements, a relaxation of restrictions on the U.S. West Coast and in Diego Garcia, Matson restriction claims filed, and the hard fought relief demands for shuttle and military ships were finally recognized. At the same time, there were both proposed and actual improvements to pension benefits, credential expirations were extended again, we recognized the 100th birthday of the Jones Act, and the Union took steps to protect itself financially.
The SUP was born to fight oppression...
Read much more from the President's Report for June 2020.
PENSION UPDATE: Benefit Improvement beginning July 1, 2020
As was reported at the meeting and in the June President's Report, the Trustees of the SIUPD Pension Plan on May 4, 2020 received the annual report of Greg Pastino, the Plan actuary. The report is a snapshot of the Plan status as of August 1, 2019 for the plan year beginning August 1, 2019 and ending July 31, 2020. Under Section 30(e) of the General Rules of the offshore collective bargaining agreements with Matson and APL, the Unions (SUP, MFOW and SIU) met to discuss the options. Given that there is a small surplus of the “net actuarial gain” as outlined in 30(e), and noting that the Plan was certified by the actuary as being in “Green Zone” under the Pension Protection Act of 2006 with a funded ratio of 105.73% and a positive credit balance for the next seven years, the Union trustees viewed and an increase appropriate and referred it to the parties. On June 3, 2020, consistent with the conservative history and prudent management of the Plan, the Unions proposed to the Employers a modest increase to the pension benefit of two-hundred dollars ($200.00) per month for qualifying participants, as well as a cost of living adjustment increase of three percent (3%) for all qualifying retirees, effective on or after July 1, 2020.
Benefit improvement: On June 18th, after hours of debate, expert testimony and negotiations, the parties agreed to a ninety dollars ($90.00) increase for future retirees who have earned the maximum benefit and retiring on or after July 1, 2020 who are at least age 60 with 25 years of qualifying time; pro-rata increases will apply for those with less time. The parties also agreed to a two percent (2%) cost of living adjustment for existing retirees with 20 or more years of qualifying time. Current eligible retirees will see the first 2% COLA adjustment in the September benefit payments retroactive to July 1. The full proration schedule is on page 4 and more will be available in the July President's Report, the July West Coast Sailors. Because the increase came as the June West Coast Sailors was headed to press, a short article and benefit schedule will be printed there as well.
There was another benefit improvement. The pension attorneys advised trustees that new legislation (SECURE Act) has created an option to increase the age at which a plan participant is required to begin receiving some benefits, a provision called the Required Minimum Distribution (RMD). Prior to the legislation, the rules governing qualified plans re-quired that participants begin receiving benefit distributions no later than April 1 of the calendar year following the year in which they reach age 70 and a half or retire. Now the required commencement date is delayed from age 70 and 1/2 to age 72 for participants who turn 70 and 1/2 after December 31, 2019. Participants who attained age 70 and 1/2 prior to December 31, 2019 continue to be subject to the old rule. For more on this see the Welfare Notes in the West Coast Sailors or contact the Plan. After questions and debate, the recommendation from Plan counsel was to adopt the new rules and the trustees agreed.
PRESIDENT/SECRETARY-TREASURER'S REPORT – MAY 2020
The lockdown continues even as local authorities deliberate the rules, timeline and extent of reopening. The Union continues the virus fight on many fronts, but in simple terms the membership will recall from previous reports our obvious priorities:
- Protect the health and safety of members, agents, and staff
- Maintain our work, our hiring halls, and our rotary system of shipping.
- Ensure compliance with our Agreements.
These are not theoretical considerations. Every day the crisis puts basic SUP operations to the practical test. Our halls remain open and our Shipping Rules in effect. To maintain the effectiveness of our hiring halls we have however had to balance safety and access, exposure risk and member services, emergency provisions and long-standing tradition. SUP Emergency Committees provided for under the SUP Constitution have met several times to assess and mitigate risk. They agreed that reducing congregational activities to the most necessary functions of the Halls, specifically job call and dispatch, would limit risk. That means that physical socializing, multi-person meetings, ship visits, and in person consultations have been temporarily curtailed. Branch agents are authorized to take appropriate steps for safety and have maintained steady virtual contact by phone and email with the ship crews and members ashore. Union and benefit plan staff are on a reduced schedule but getting the work done. Aside from most dispatching, the normal services of the Union are available to members on remote service basis. This includes grievance handling; registration; welfare, pension, supplemental benefits, and medical services processing; credential and training consultation and guidance; upgrade applications, and many other things.
More from the President's Report for May 2020
PRESIDENT/SECRETARY-TREASURER'S REPORT – APRIL 2020
SUP members at sea and ashore have all been deeply affected by the coronavirus. On ships and in the hiring halls there are new restrictions and protocols. In every workplace members struggle with new cautions and protections, and retirees were kept in forced isolation by the necessary cancellation of meetings. The Union itself stretched to maintain its operations and fulfill its obligations. A dark mood of dissatisfaction was borne with dogged perseverance and dedication to duty.
As states and localities deal with the consequences and rules of an emergence from the coronavirus lockdown, the nation continues to grapple with the effects, and some kind of co-existence with the virus now appears probable.
Looking back, the lockdown began in San Franciso on March 16 when, in a joint announcement, public health officials in the Bay Area put out the regional "shelter in place" until April 7 in an effort to slow the spread. Of course, April 7 came and went, but everyone stayed in as the order was extended to May 3. Now health officials have indicated that the order has been extended again in the ports of San Francisco Bay, at least until June although there is no date certain. There may be an easing of certain low-risk activities but as of April 27 there are no details.
Check back here for more information as it changes and as other jurisdictions declare their status. In the meantime, with specific regard to the Union response to the pandemic over the past month, please consider the following...
April 2020 COVD-19 Emergency Overview and Disaster Response
The grim statistics as of today’s report April 13, 2020 are unavoidable: there are more than 2 million cases of COVID-19 and over 160,000 deaths in 185 countries. There are more than 700,000 confirmed cases in the United States, far more than any other country, and more that 37,000 deaths. States of emergency and disaster declarations have been declared for all 50 states and there is no corner of American life that has not been affected by dual disasters of the health emergency and the associated economic contraction. The tragic human cost is incalculable.
The economic costs are beginning to be measured, but economists such as the those at the International Monetary Fund have begun to use outlier descriptions such as “greatest recession since the Great Depression.” By only one measure, the number of Americans filing for unemployment topped 25 million during the last month. As everyone stayed home to fight disease, the U.S. consumer economy abruptly stopped. The impact was pervasive and cut deep into every sector of the economy. In maritime transportation there was widespread devastation as cargoes all but disappeared and shipping companies struggled with dramatically reduced supply and demand. In commercial and defense sub-sectors, in bulkers, ro/ro’s, tankers and containerships, dozens of indicators are in the red and the question of duration looms.
Through it all, the health and safety of SUP members and their families remains our primary focus and principal concern. Both in the workplace and the Union Halls, we’ve moved quickly to manage the risk. These temporary protections for safety may change again but will stay fixed on keeping us all free of both hardship and disease.
More from the April 2020 President's Report...
Foss Maritime Company
Throughout February the rank-and-file members employed by Foss met and talked by various methods in preparation for bargaining a new contract that expired on February 29 2020. On February 14 this same group met again as the de facto SUP Negotiating Committee to discuss proposals and strategy before meeting with the Company at their Home Dock in Richmond, California.
Given the fresh uncertainties of the business environment including the impact of new low sulfur marine fuel rules promulgated first by California and then by the International Maritime Organization, and in the context of barge layup related to the Company’s short term agreement with its primary supplier, Chevron Corporation, the Committee understood a short-term agreement would best serve the interests of the members employed by Foss.
The Foss Negotiating Committee comprised of rank-and-file members and Foss employees Mike Higa, Tom Tynan, J.D. Rymel, Jason Chilbert, Karl Turner, Fernando Liencres, Don Nichols, Mike Potenti, Kelly Johnson, and SUP VP Matt Henning met to caucus on the issues before meeting with the Company on February 14, 2020 in Richmond, California.
Retaining the qualified labor pool despite a reduction in vessels and work related to new IMO regulations on the marine fuel business was a primary theme. Given customer Chevron’s release of a barge requirement and the severe limitation of call out work, the membership employed by Foss is aware of the business climate. In that light, the Committee believed that a short-term extension was in our best interests. The Company agreed, and late in the day subject to various terms and conditions, a tentative deal was reached.
Despite some pressure for structural change, there were no concessions and present conditions and work rules were maintained. Extension terms and improvements included
- One-year (1) extension of existing terms to February 28, 2021
- Three and a half percent (3.5%) increase on wages and wage related items including overtime rates beginning on March 1, 2020.
- Elimination of call out rates – parity achieved between lower call out rates and crewed rates for boat personnel such that all call-out employees will only be paid at the higher crewed rate of pay.
- Missed meal hour compensation will be compensated along the lines of the present practice and consistent with the law and the policy presently in effect (2 hours in a 12 hour shift).
- Foss-qualified tankermen eligible for engineer training – official opportunity, sanctioned now by the new Subchapter M rules promulgated by the Coast Guard, to train as engineers consistent with the seniority and assignment provisions of the Agreement.
About tank barge captain workload including new administrative duties and retention during the downturn, the Union proposed a new Tankerman Readiness Pool consistent with Work Rules already set forth in Agreement. Like the Weekly Available for Overtime List, the proposal came complete with call order, qualifications, and assignment rules. As part of the settlement, however, it was set aside for consideration at the next round of bargaining. The Committee was convinced that they had secured the best possible agreement and that nothing was left on the table for this extension. Accordingly, Mr. Chairman on their behalf I recommend ratification of the Foss short-term agreement to extend.
Ready Reserve Force
The U.S. Maritime Administration contracting officers, after long delay and discussion, accepted the total labor cost (TLC) pricing as previously proposed by a unified maritime labor (as presented by their contracted companies) to operate and maintain the nation’s Ready Reserve Force. That pricing was based on a TLC increase subject to the allocations of the individual unions for two option years, Year 5 and Year 6 at two and one-half (2.5%) percent. Except for minor allocation adjustments by company in benefit contributions amounts, the increase wages and benefits are identical for Matson and Patriot in both Full and Reduced Operating Status and are as follows:
Full Operating Status
Monthly Wage Wage OT Supp Wage Money Purchase Pension
Bosun 5413.82 180.46 41.53 3140.02 104.67 10.82 20.00
AB 4308.65 143.62 35.45 2499.02 83.30 10.82 20.00
OS 2966.25 98.88 21.19 1720.43 57.45 8.87 20.00
GVA 3478.56 115.95 21.19 2017.56 67.25 9.73 20.00
Reduced Operating Status
Daily Monthly/ Daily
Weekly Wage Wage OT Supp Wage Money Purchase Pension
Bosun 1679.69 239.96 41.12 111.98 16.00 10.77 20.00
GVU/ 1031.53 147.36 20.98 68.77 9.82 10.77 20.00
The Ready Reserve contract will continue Group II eligibility for SUP Welfare Benefits including full medical and dental coverage for members, spouses and legal dependents without changes. The Group II coverage period, also unchanged, remains six months of rolling eligibility based on the number of days worked, i.e., one hundred and twenty (120) days for initial eligibility and sixty (60) days for continuing eligibility. The pension contribution, already in place for over a year, maintains pension eligibility. Other contributions covering Training, the Joint Employment Committee, and the Seafarer’s Medical Center were also increased by 2.5% as allocated. The increases apply to wages and benefits of SUP crews in Patriot’s Admiral Callaghan, Cape Orlando, Cape Texas, Cape Trinity, Cape Taylor, Cape Vincent and Cape Victory as well as Matson’s Cape Hudson, Cape Horn, and Cape Henry. Crew composition remains the same in ROS and FOS except to note some preliminary discussion with MARAD about possible riding gangs in supplemental maintenance jobs. Finally, we have demanded and been given as yet unconfirmed indication that the proposed increases will be retroactive to January 27. 2020. Mr. Chairman, I recommend ratification of the 2.5% increase to Total Labor Cost in the Union’s Ready Reserve contracts in Option Year 5.
Further to the topic of government shipping, on February 11 a teleconference announcement to maritime labor and industry from Maritime Administrator Admiral Mark Buzby was held on President Trump’s fiscal year 2021 budget request for the Ready Reserve and the Maritime Security Program. The President’s budget calls for full MSP funding at $314 million, or 5.2 million per vessel. This is the second consecutive year that full funding has been requested after less than that in his first two budgets and following an all-out effort by maritime labor and industry to security the funding through Congress. The budget also calls for a $436 million for the RRF program, an increase of $84 million from the prior year. The budget request was notably entirely deficient however in funding for the US AID PL-480 Food for Peace program. The lack of support for Food for Peace program was expected and labor has already identified it as a priority for political action this year. In letters to the Chairs and Ranking members of the House Subcommittee on Agriculture, part of the House Committee on Appropriations, the SUP was signatory to the request to Congress to fully fund the food assistance programs that make up an important component the cargo preference aspect of maritime cabotage.
Coronavirus (COVID-19) update
As was reported in last month’s West Coast Sailors and throughout mainstream media, coronavirus continues to disrupt economies, travel, and shipping worldwide. With most new cases now occurring outside China, it continues to be a highly dynamic situation and exacerbated by a lack of verifiable information. Occurring as it often does with mild or no symptoms and becoming apparent or not over a long incubation period and where there is no testing available it is a malady that is for ripe for misunderstanding, bad information, and probably underreporting. Even if the information were more readily available and reliable there would still be room for alarm and concern, though it appears manageable even in scenarios of greater spread. President Trump has issued two Executive Orders on the topic, government agencies have followed with their own warnings and guidance and Congress has passed a 8 billion dollar emergency aid package. The Center for Disease Control has warned of widespread contagion in the U.S., and although it appears relatively mild so far, the states of California and Washington have declared emergencies due to the outbreak.
As of today’s meeting there are roughly 112,000 cases worldwide in 111 countries and one international conveyance with over 4,000 deaths. China still has the largest number of cases by far, followed by South Korea, Iran and Italy. Interestingly, the international conveyance was a single ship, the Diamond Princess, and accounted for the fifth highest concentration of cases at 696. In the United States, there are now nearly 566 known cases of COVID-19 in 33 states, 22 deaths. There are 114 cases in California including 21 new cases in a cruise ship that was held outside San Francisco and coming into Oakland today. There are roughly 70,000 recovered cases in total. Fierce outbreaks in Italy and Iran have spread into Europe, but new cases appear to have begun to decline in China and may be levelling off in Korea.
The human costs are still uncertain, but the economic damage is not. When it started in late December and January, SUP sailors were at the forefront of a worldwide supply shock that is only now becoming clear to the general public. If that supply shock is now accompanied by a corresponding decline in demand, then the global economy is at risk. Evidence pointing that way continues to pile up. Much business travel has been suspended, major conferences, concerts and other events have been cancelled. Business activity is suppressed, stock markets are rattled, and the Federal Reserve has imposed emergency interest rate cuts. Trucking and port activity in Asia is sharply diminished and port slowdowns in Los Angeles and other ports are evident. Blank sailings have reached multi-year record highs as container shipping volumes on both the import and export sides of the ledger have fallen by as much as one-third. Of course, the freight rates of tankers, bulkers and containers are plunging in response.
Matson management’s earnings announcement for the fourth quarter of 2019, which predated most of the trouble, was generally positive but officially warned of negative effects ahead in terms of lower volumes and rates across its businesses. CEO Matt Cox advised analysts to expect a 15 million dollar hit to operating income for the Ocean transportation component in first quarter of 2020 attributable to coronavirus impact. CMA-CGM has indicated a “challenging environment” and industry press has suggested that the Company, one of the largest container shipping companies in the world, may have difficulty servicing its debt.
Pursuant to Presidential proclamations (Executive Orders), as well as rules and policy by Department of State, Department of Homeland Security, Customs and Border Patrol, and the U.S. Coast Guard, all ships including U.S. flag ships seeking U.S. port entry are subject to 14 day at sea quarantine and clearance as well as isolation for any crew exhibiting symptoms.
There are several important operational considerations for the Union. First, a healthy and prepared membership is a precondition to our success and members are urged to take extra caution to stay well for their own sake but also as a function of Union readiness. Stay away from sick people, and take protective measures including frequent washing of hands, recognizing the symptoms (especially fever, cough, shortness of breath), monitoring self-care and seeking medical care if sickness progresses, disinfecting surfaces, avoiding hands to face contact. As always members must also maintain readiness in their credentials. Be mindful of expirations, renew with plenty of time, plan for possible processing delays, and remember that increased focus on immigration issues both here and overseas may uncover documentation problems.
Second, members who are sick or not feeling well should not be working at sea or ashore, and should stay away from the hiring halls. Members recently in Asian ports, or other known outbreak “hot spots” such as Iran and Italy, should a “self-quarantine” for a minimum of 14 days from departure with or without symptoms. Any member with symptoms independent of travel history should also “self-quarantine” (unless conditions worsen and then should seek immediate medical attention) and avoid visiting any hiring hall. Members in either category shall be allowed to register by phone by adoption of this rule under the emergency provisions of the shipping rules. The SIU and MFOW have taken similar action.
Third, the Union’s trust funds offices and medical clinics deserve the same consideration as our hiring halls. One clinic recently refused service to SUP and MFOW members based on misperceived exposure risk. Working with Seafarer’s Medical Center Administrator Michelle Chang, we successfully intervened first to initiate the backup clinic and then to restore and maintain service. Members should avoid any unnecessary visits to the SUP Welfare Plan offices and related trust offices, in any case, and any members who are subject to any exposure risk should “self-quarantine” and conduct business over the phone or by other means. Members departing ships and seeking to file claims for Supplemental Benefits should send copies of their discharges to Union Agents for processing and forwarding to Plan personnel. To maintain the viability of our rotary shipping system we must respect the health and safety of those that work within that system; doing so will be in part an exercise in self-management including self-imposed quarantine. The Union stands ready to assist in that effort.
Fourth, members have been advised, in this report last month and in dozens of emails, phone calls and meetings since then, restrictions to ship claims directly related to this crisis are not payable. Matson and APL management have in several cases shown uniform refusal to pay and the language of our collective bargaining agreement supports that position in the emergency exemption clause. Moreover, language to the contrary is preempted by the emergency life-and-death nature of the pandemic, effectively suspending the normal restriction requirements, especially the foreign government written order clause. The collective bargaining intent and purpose of that written order is to prevent arbitrary restriction that is so evidently not the case here. At the same time, we have insisted to management that they live up to the letter and the spirit of our agreements, despite the crisis. We reiterated our normal right to shore leave, and warned them that we will evaluate each restriction claim on the merits so that there are no arbitrary, retaliatory, or discriminatory denials of legitimate claims. If delegates conclude that despite all of the foregoing the restriction is still arbitrary, they are advised to record and collect the information, make the claim and submit documentation to SUP Headquarters for evaluation as per the grievance procedure.
Finally, members should be aware that the Union has taken steps to maintain the continuity of its hiring hall and other operations, in the present circumstances and in any eventuality. Those steps include staff briefings, distribution of educational materials, and various contingency planning.
Of the U.S. government we have demanded fairness and respect about quarantines and shore leave procedure, freedom to embark and disembark in U.S. ports, and exemption from a sweeping occupational discrimination that could easily arise against us given the migratory cross-borders nature of our work. Of the employers we have demanded a safe workplace, protective policies and gear, no arbitrary restrictions to ship, and policies that limit exposure to contagion, among other things. Remarkably, these demands have so far been met. The uncertainty of elements of the pandemic is compounded by a natural fear common to such situations, yet the best information still suggests low risk for most Americans, including American sailors. We are determined to be prepared such that come what may, in war and peace and pestilence, the SUP will withstand the crisis.
Cesar Chavez Day All SUP Halls on the West Coast will be closed on Tuesday, March 31, 2020, in observance of Cesar Chavez’s Birthday, which is an ILWU holiday and a recognized holiday under SUP agreements with the San Francisco Bar Pilots, as well as Matson and APL for their ships in West Coast ports. It is not a holiday at sea.
Harry Bridges Memorial Day: The Honolulu Hall will be closed on Monday, March 30, 2020 in observance of the ILWU Local 142 holiday. As an ILWU holiday it is also a recognized SUP holiday under the Matson Agreement for company ships in Honolulu on that day, the Paint and Rigging Gang working under the SUP/Matson Maintenance Agreement, and Honolulu standbys working under the Extra Maintenance Agreement. It is not a holiday in West Coast ports.
Good Friday: All SUP halls will be closed on Friday April 10, in observance of Good Friday. Under our Agreements with Matson and APL, unlicensed personnel shall be granted a three-hour holiday between noon and 3:00 PM and overtime will be paid if required to work during those hours. The Honolulu Branch will be closed all day on April 10, as it is an ILWU Local 142 holiday. Therefore, it is a holiday for Matson ships in port and for those working under the SUP/Matson Maintenance and Extra Maintenance Agreements.
March 6 1885
This month of March is the sailors’ month. This year the Union celebrates its 134rd anniversary of its founding at a meeting of sailors at the progenitor of today’s meeting on a lumber pile on a wharf at the foot of Folsom Street on San Francisco’s Embarcadero on March 6, 1885. March is also the birthday month of the two leaders of the SUP, Andrew Furuseth on March 5, 1854 and Harry Lundeberg on March 25, 1901, both luminaries of American labor history. It is also the month of the passage of the Seamen’s Act, signed into law by President Woodrow Wilson on March 4, 1915 after a 20-year struggle by Furuseth to free seamen from indentured servitude. Later this year we will also celebrate the 100th year of the Merchant Marine Act of 1920, also known as the Jones Act. As venerable and long lasting as the Jones Act is, it’s instructive to remember that the SUP was already 35 years old at that point, and had emerged from violent union-busting attacks, conducted several major strikes, coordinated hundreds of smaller job actions all the while successfully organizing dozens of companies and helping to enact three other major pieces of national legislation favorable to the U.S. merchant marine. All that is only part of an astonishing overall record of success, worthy of proud celebration. Happy Birthday to the SUP.