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Port truck licensing rollout gets rough ride

A suite of measures designed to fix troubled labour relations at Vancouver’s port has instead stirred up acrimony and threats of legal action
Container trucks awaiting loads at a Port Metro Vancouver container terminal. Photo: Chung Chow

A suite of measures designed to fix troubled labour relations at Vancouver’s port has instead stirred up acrimony and threats of legal action.

“This has clearly been a rushed process, and … that’s why they ran such a profoundly flawed process,” said Lisa Martz, a lawyer with Gundmundseth Mickelson who is representing several trucking companies.

On January 23, Port Metro Vancouver released the list of companies it had awarded licences to, according to its revamped truck licence system. The changes reduced the number of trucks in the fleet.

The measure was intended to reduce persistent undercutting in the industry, which has eroded trucker wages. In March 2014, truckers went on strike for a month to protest low wages and long wait times at terminals.

Under the new system, truck owner-operators would no longer hold their own licences to access port terminals. Those licences instead would be held by trucking companies who would sponsor owner-operators.

But many trucking companies were caught off guard when they learned they had received no licences, which meant they had effectively been put out of business. An estimated 600 people who work in the trucking industry could be out of job. 

Martz sent a letter to Port Metro Vancouver, the B.C. Ministry of Transportation and the federal Ministry of Transport outlining what she views as serious problems with the way the license reform was handled.

Those problems include the short time allocated to the companies to comply with new requirements and the lack of an appeals process.

“Our clients had a matter of less than five weeks over the Christmas vacation period in which to familiarize themselves with the new application process and submit their applications,” Martz wrote.

“On or about January 26, 2015, only five days prior to the expiry of their current licenses, our clients were notified that their applications had been denied and that their access to the port, and therefore their businesses, were at an end.”

Martz also questioned whether Port Metro Vancouver, a federal body, should have had authority over the new truck licensing system at all, given that there was a planned transfer to a provincial commissioner who will oversee the port trucking system.

That commissioner, Andy Smith, was named on February 3. Smith is currently the president and CEO of the B.C. Maritime Employers Association (BCMEA), which represents ship owners and terminal operators.

“The Port is a government decision maker and there are a number of things a government has to get right when they are denying legal rights to people,” Martz said.

Gavin McGarrigle, B.C. director for Unifor, questioned whether Smith was the right choice for the job given his current role. Unifor represents around 400 of the container truckers who work at the port.

"At first glance it appears to be a blatant conflict of interest … my understanding is he's going to continue to serve as the chair of the BCMEA," McGarrigle said. "This is the group that represents terminal operators."

Staff at the BCMEA confirmed that Smith would continue in his current role.

For instance, terminal operators have been unhappy with new fees they must pay if truckers have to wait too long to pick up their loads, McGarrigle said.

"Now you've got the head of the [association] that negotiates for that group in charge of issues to do with truckers. How can you represent the interests of those employers … you've got the fox in charge of the henhouse."

Smith has a lot of experience with the shipping industry, but should resign from his current position before taking on the trucking oversight role, McGarrigle said.

"Mr. Smith is giving consideration to how to conduct his role at the British Columbia Maritime Employers Association (BCMEA) to ensure he is not in a conflict or biased situation," wrote Ministry of Transportation staff in an email.

"This includes working with legal counsel with expertise in this area who can advise the Commissioner as to when he should remove himself from BCMEA business that could place him in a conflict situation. It will be up to Mr. Smith and his BCMEA board to make sure his BCMEA activities do not create a conflict for either role." 

Shippers have also raised concerns over the new truck licensing system and the rapidly escalating costs of shipping products via containers.

Prior to his retirement at the end of June last year, Western Canadian Shippers’ Coalition (WCSC) Chairman Ian May told Business in Vancouver that 100% of the coalition’s members were seeking break bulk and other container alternatives for shipping their cargo because of the added costs resulting from new pay rates for container truckers following the truckers’ strike.

Not much has changed on that front.

WCSC chairman David Montpetit said the same percentage of WCSC members, most of whom export wood products to the United States and Asia, are still pursuing alternatives to containers.

He estimated that over the past five years costs for shipping via containers has doubled.

Those rising costs will affect more than WCSC members and other exporters.

As Montpetit pointed out, the more his members divert product from containers to break bulk, the more serious the domino effect will be on importers who use containers because they’ll bear the extra costs of containers returning empty to Asia and the United States.

“Importer costs are going to start rising,” he said, “[because] they will not have two-way haul.”

Montpetit added that, while the intent of the new truck licensing system (TLS) is “noble,” its execution has been poor.

He said its biggest upside is the reduction in the number of licences for truckers accessing the port and a greater accountability in the system because licence ownership is in the hands of truck owners not drivers.

But Montpetit said there are still too many truckers for the amount of container business available to them.

“There are 4,000 daily gate transactions and 1,400 licences [now] compared with 1,850 previously. The number should be less than 1,000 [so] each truck should haul four to five loads per day.”

He added that his members are concerned that added costs of the new system will be downloaded to shippers and make transporting their goods via container even more expensive than it is now.

PMV spokesman John Parker-Jervis said the port will cover the cost of its transition program for independent truckers who no longer have access to the port and that overall TLS costs will be covered by licensing fees paid by trucking companies.

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