The expiration date for the East and Gulf coast dockworkers is nearing and no resolution has been made. Why is this important?
Well, the International Longshoreman Association (ILA) has taken a strong stance on what they say they will do, if a contract is not reached by the September 30th deadline and have signaled that they will go on strike if a new contract is not reached.
Current Status
Key points of contention include wages and automation. The ILA is pushing for contract terms that protect union jobs from being replaced by semi-automation and full automation at marine terminals. While specific contract demands remain sealed, reports suggest that the ILA is seeking a 78% increase in the top wage rate, which translates to a $5 per hour raise each year over the six-year term, according to a JOC article. The ILA held a “wage scale” meeting on September 4th and 5th to discuss financial demands and prepare strike committees, as reported by Maritime-Executive.
On the other side, the United States Maritime Alliance (USMX) has offered an approximately 40% increase. However, as stated in their August 30th press release, they have been unable to secure a meeting with the ILA to continue negotiations. In their most recent press release, the USMX reiterated their commitment to resuming negotiations before the current agreement expires and avoiding a strike.
Many industry groups and stakeholders, including the Transportation Intermediaries Association (TIA), National Retail Federation (NRF) and the American Apparel and Footwear Association (AAFA) , to name a few, are stressing the importance for the parties to come to a resolution, and the federal government to monitor the situation and intervene if necessary.
Looking Ahead
As we don’t have a crystal ball, the situation remains uncertain. For U.S. shippers, it’s wise to discuss potential rerouting with their transportation providers in case the labor dispute escalates and to stay in communication, should worker stoppage occur.
Be prepared for various scenarios including but not limited to: the contract resolving before (or at) the deadline, negotiations stalling leading to a strike of indeterminate length, or the federal government intervening and invoking the Taft-Hartley Act, which would force workers to continue, but could lead to a worker slowdown.
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