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[ ] R E P O R T P A G E 2 Advice on Softening the Economy's Impact on Labor Relations All at us, whether it be in our persol~al lives or our prx~fesslon al lives, have felt the mighty blow that has been delwered by s u c h a d Y a m a t i c i F fl p a c t o n o u r economy¸ Fourth quarter and year end results will not be available for another 3045 days, but all of us are anticipating some very bleak numbers¸ [n this report, I would like to offer a tew sugge~tiol~ that will help soften the blow in our everyday dealings with the Union during these difficult hines Contractual Obligations Whether/he economy is at an all time low or is star/rag to r~cover, we 0dSMX members) have a Contract with the Inten~atonal Longshoremen's Ass~ziafion that ~s in effect until September 30, 2010 The Contract does not preclude you from making changes to your opera hans to r~duce expense~, but it doe~ r~quire that the changes fall within the framework of the cun~nt Contract This is a period where all companies will be looking for ways to reduce costs and we at USMX are available to work with you and to provide advice that will en~ure compli ante with the Contract Maintenance I n m ~ t p e r i o d s o f e c o ~ o l ~ l C downturn, the first thing that Carrier~ do is to defer preventive m a i n t e n ~ r l c e p r o ~ a m s T h e e are prx~grams that do not have to be per forn/ed m 2008 or 2009 We must ensure, however, that when the progran~ are r~insttuted, that the work ~s per formed by ILA mechamcn Minor damage ~s also a very important item The Carrier has the right to decide if and when minor damage repairs are to be performed¸ The Contract, how ever, is perfectly clear: Artde IX, Section ~ states "When such marine terminal work is moved of[ ~e marine terminal by the terminal operator or b~ a stgnatory carrier to facilities in the port area, the ILA shall retain its work jurisdiction, where ~e work is ~e work ~at zaouId have been performed in the ~ l a r # l e t ~ r ~ l i n a l o r p o r ~ a ~ S e v e r a l i n s t a n c e s h a v e s u r f a c e d in the Port of Baltmore alleging that Corners are having minor damage repan ed m nonunion depots within the port area We ask that you review your opera tons to el~ure that you m~ in compliance USMX is available to answer any question~ you mzght have Conlmunicafion is the Key to Success There is no doubt that our member Carrier~ and Terminal Operators will have to intro duce change to then opera tons in order to survive this time of economic downturn Again, we at USMX m~ committed to providing expert advice and service to our member~ to ensure that the change~ are in compliance with our members' conb'actual obligations But, more lmpor tanL is the manner in which these change~ are communicated and implemented For instance, practice~ that have been in place tar several years should not just be changed on a Monday morn ing, even though the Contract indicates that you could do that A much better way, and one that would provide a seamless change, would be to communi cate your proposed changes to the Local ILA leadership Once you gain their understanding of the changes, it makes then job easier in dealing with complaints from the union wolMolce involved m your operation As with the other issues, USMX is available to assist you in the development of your c o r l ~ I / 3 U l / i c a t o n s Brian E Dugan Vice President, Labor Relations Report Distribution List Y o u c a n e x p e c t t o l ~ c e l v e ~ u t u l e issue~ of The USMX Report via The USMX Report, just send request to Editor Beth Monica at bmonlca@usmx cam

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