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Seafarers and shipowners fail to agree over minimum wage

Seafarers and shipowners fail to agree over minimum wage
Mark Dickinson

Talks to increase the minimum wage at the International Labour Organization (ILO) have broken down as seafarers call proposed 3% increase a “slap in the face”.

A three-year deal was put forward by ship-owners to provide a level of security to seafarers across the world “at a time when many workers on land are having pay freezes and losing their jobs”.

Natalie Shaw, director of employment affairs at the International Chamber of Shipping (ICS), said: “Unfortunately the seafarers’ representatives rejected a generous offer from the shipowners in these unprecedented times.

“We went further than anticipated but the offer was still rejected. However, our door is always open.”

According to the ILO process, rejecting this offer would mean that seafarers will now not be entitled to a rise in the minimum wage for two years.

The ICS noted that shipowners remain open to discussing the minimum wage with the unions in an effort to seek an early resolution.

Mark Dickinson, seafarers group spokesperson at the ILO and vice-chair of the seafarers’ section of the International Transport Workers’ Federation (ITF) stated: “For only the second time in the long history of these negotiations the shipowners and the seafarers have failed to agree a revised minimum wage for seafarers.

“And that’s wholly the fault of the shipowners, who have behaved with such an astounding lack of self-awareness and a lack of respect for the sacrifices of seafarers – especially these past 14 months.”

Failing to agree means that the ITF must now unilaterally determine the ILO minimum wage rate using the ILO formula.

The formula puts the minimum wage at US$683 per month with effect from January 1, 2022, a US$1.40 increase on the current rate of US$641, which was set following discussions at the ILO in 2018.

The wage rise represents less than the price of a cup of coffee in most countries.

New research from the ITF showed a quarter of seafarers were considering quitting the industry already due to the ongoing crew change crisis and another 23% of seafarers were unsure about their future, which suggests a seafarer supply crunch could be looming.

Dickinson added that COVID-era travel, transit and border restrictions meant a prospective seafarer might not see their family for years.

“Sadly the result of shipowners’ pay freeze is a pay cut in real terms – accelerating an industry labour shortage,” Dickinson said. “It’s hard enough for these companies to recruit seafarers with the crew change issue, I would have thought now would be the time to be investing in your people and making his industry more attractive to join – not less.”

Dickinson said that the shipowners’ arguments that the industry had suffered financially during the pandemic was not rooted in reality, especially compared to the strain and turmoil experienced by seafarers battling the pandemic, a lack of crew change and its impact.

“The shipowners cry crocodile tears,” he said. “They only pretend to care.”

He added that international shipping rates were at all-time highs and most shipowners had done well out of the pandemic, despite earlier predictions of falls in revenue and profitability.

Dickinson stated: “Seafarers are heroes of the pandemic. They have sacrificed time and time again. They have literally risked their lives so that these companies could survive COVID-19 and its economic effects.

“And now the thanks they get is a slap in the face from the shipowners who are essentially making them choose between pay cuts now or pay cuts later. It’s disgraceful.”