Responding to a 10 per cent pay offer with another strike notice is resulting in the Ports of Auckland openly talking about contracting out its labour.

The offer was presented to the Maritime Union of New Zealand during mediation on Thursday.

The 10 per cent offer was in exchange for full operational flexibility and productivity increases.

Ports of Auckland chief executive Tony Gibson says the offer is a last ditch bid to resolve the dispute.

It has already disrupted pre-Christmas trade worth $630 million and cost the company a $20 million customer.

Ports of Auckland has withdrawn its previous offer to roll-over the expired collective agreement.

'Maersk's decision to pull the Southern Star service out of Auckland – effective immediately – was a game-changer,” says Tony.

'Our earlier offer, including the promise to make no redundancies or undertake further out-sourcing for the term of the agreement, has been withdrawn.

'The Maersk decision has shown us that we're out of time – we need to lift our game, and lift it now.”

Maersk shifted its Southern Star service to the Port of Tauranga.

Tony says he will explore other contingency plans, including the possibility of contracting out work to other companies, if he is unable to achieve a collective agreement with the union.

If accepted, the port company's offer will modernise working practices at the Ports of Auckland container terminals, make productivity gains and provide reliable, flexible 24/7 service, says Tony.

Performance related bonuses included in the offer mean that a top performing stevedore could increase his or her hourly rate by as much as 20 per cent.

The offer provides the opportunity to plan rosters a month in advance and stevedores would keep all current benefits and entitlements, including superannuation contributions up to seven per cent, medical insurance and leave provisions.

'Our strong preference is to work with the union to achieve a settled collective agreement that will deliver the certainty and flexibility our customers need, while still providing fair terms and conditions, and respecting our employees' preferences about when they work,” says Tony.

'However, it is vitally important to us that we are open and truthful with our employees about the possibility of redundancies and our intention to explore alternative business models, including contracting out.”

He says the new 30-month proposal is in line with the pay rates and conditions agreed with non-union employees on individual employment agreements.

The union ended Thursday's discussion by serving a new 48 hour strike notice for Friday, December 30 from 7am until Sunday, January 1 at 7am.

The strike coincides with a KiwiRail shutdown for electrification works.

During the shutdown, the capacity of the key rail corridors between Auckland, Tauranga and the Waikato will be significantly reduced, says Tony.

'Extended delays and ongoing congestion in the supply chain are likely.

'These strikes promise to be even more disruptive for consumers, importers and exporters than those to date.”

The parties have agreed to meet for further mediation next week.

'We recognise an increase of 10 per cent in the current economic environment may surprise some,” says Tony.

'But it reinforces our commitment to fundamental improvements in workplace productivity and to settling the current industrial action as soon as possible.

'Our customers are demanding that we sort this out once and for all.”

He is repeating his call for the union to withdraw the two 24 hour Christmas strike notices it has issued for December 22-25.