DP World strike may be felt by everyone

Professor Vinh Thai, logistics and supply chain management

Topics: supply chain, maritime logistics, economy, shipping delays  

“The current ongoing industrial actions at DP World container terminals around the country have been going for some time now.

“Elsewhere in the world, such actions may have a tremendous impact.  

“For example, during the 11-day closure at 29 major ports on the US West Coast from Sep–Oct 2002, port authorities estimated a loss of $19.4b. The Boston Consulting Group estimated that a 1-month disruption in US West Coast ports would reduce exports from Asia by about 0.4% of GDP, with the negative impacts on Hong Kong, Singapore and Malaysia being about 1.1% of GDP.

“Industrial actions leading to stoppage at ports may have direct, indirect and induced effects on supply chains, national economy and society at large such as:

• Delayed or no work on cargo loaded and discharged at wharfs, yards and gates. This can lead to longer time in ports for ships and cargoes, and higher costs, including the inventory carrying costs for shippers and shipping lines. 
• Delayed ships at Australian ports leading to shipping frequency being slowed down, creating a longer waiting time for import and export cargoes. 
• Longer time at ports for import cargoes meaning higher prices when they reach the end-users, while for export cargoes it implies the loss of export time-competitiveness. 
• Higher price of import cargoes may add to inflation and, of course, the rising cost of living, while loss of export competitiveness implies the negative impact on the nation’s balance of payment. All can contribute to social chaos. 
• Onflow delays in supply from the shore e.g. warehouses, distribution centres and retailers such as supermarkets.  

“While the Union has the right to enact industrial actions to protect the workers’ rights, the port operators also have their justifications as industrial actions can lead to disastrous impacts not only on their own business but also on supply chains, the national economy, and society.

“Given that DP World accounts for 40% of Australia’s port throughput, the issue has to be handled with care.”

Professor Vinh Thai is professor of logistics and supply chain management and founder of the Australian Maritime Logistics Research Network (AMLRN).

Distinguished Professor Anthony Forsyth 

Topics: workforce, industrial action, trade unions, Maritime Union of Australia, Fair Work Act

“The DP World dispute is being likened to the 1998 waterfront dispute.  

“While there is some potential for the current dispute to cause disruption to supply chains and the national economy, this is a regular form of industrial conflict over pay and conditions – nothing like the 1998 episode, in which the Howard Government and Patrick Stevedores sought to de-unionise the waterfront.

“DP World is lobbying the Federal Government to intervene, using a power in the Fair Work Act that enables the Employment Minister to terminate industrial action if it threatens to cause harm to the welfare of the community or damage to the Australian economy.  

“That ministerial power has never been exercised and it is unlikely we will see a Labor Government use it in this case.

“The company could instead seek an order from the Fair Work Commission, terminating the Maritime Union of Australia’s (MUA) industrial action on the same grounds – harm to the community or the economy.  

“DP World would have to provide evidence that the union’s work bans are having a crippling effect on stevedoring services and disrupting the supply chain of essential goods and products.  

“However the MUA’s strategy appears to be carefully calibrated to ensure that the work bans do not cross the threshold that would see them terminated by the Commission.

“As the dispute drags on, the Albanese Government will come under increasing pressure to steer the parties towards a resolution in the national interest.”

Distinguished Professor Anthony Forsyth specialises in collective bargaining, trade unions, union education, labour hire and the gig economy. His research traces the shifting legislative agendas of Coalition and Labor Governments in Australia and connects our national discourse on workplace regulation with international debates.

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