Industry organizations call on the White House to work with the ILA and USMX to resume labor talks

A letter sent to President Biden today by 158 state and federal trade associations made the case for the White House to work with the International Longshoremen’s Association (ILA) and United States Maritime Alliance to get the parties to resume talks on a new labor agreement, with the current one set to expire on September 30, and following the ILA’s move to suspend talks until certain conditions, regarding port automation processes are met.

The letter from organizations representing manufacturers, farmers and agribusinesses, wholesalers, retailers, importers, exporters, distributors, transportation and logistics providers, and other supply chain stakeholders asked the White House to immediately work with both parties to resume contract negotiations and ensure there is no disruption to port operations and cargo fluidity.

Freight transportation- and logistics-related organizations signing the letter included: the National Retail Federation; the Council of Supply Chain Management Professionals; the American Trucking Associations; the Coalition of New England Companies for Trade; International Warehouse Logistics Association; and the Transportation Intermediaries Association, among others.

“One of the key priorities for the administration has been supply chain resiliency and addressing ongoing supply chain challenges,” the letter stated. “We continue to see maritime supply chain challenges from the ongoing Houthi attacks on vessels transiting the Red Sea. This has led to other supply chain issues: congestion and lack of equipment at overseas ports, carrier capacity issues as they continue to divert vessels away from the Red Sea, and increased freight rates. With all these existing challenges, the last thing the supply chain, companies and employees—all of which rely on the movement of goods, both imports and exports, through our East Coast and Gulf Coast ports—need is a strike or other disruptions because of an ongoing labor negotiation. As this administration has seen, even the threat of a strike or disruption can have a negative impact on the supply chain.”

What’s more, the letter added that there are recent examples these disruptions and their negative economic impact, as recently as last year, during West Coast port labor negotiations between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA), which saw what the letter described as a significant shift of cargo from the West Coast to the East Coast and Gulf Coast ports because of the challenges and uncertainty during the last West Coast port labor negotiations.

“While much of that business has remained at the East Coast and Gulf Coast ports, we are starting to see a shift back to West Coast gateways, where a long-term contract is in place, especially as we enter the busy peak shipping season,” the letter said. “We know there are a number of issues for the ILA and USMX to negotiate as part of the contract. However, the only way to resolve these issues is for the parties to come back to the bargaining table and actually negotiate the new contract. We encourage the administration to provide any and all support to the parties in their negotiations so they can reach a final agreement before the current contract expires.”

The ILA is the largest union of maritime workers in North America, representing workers at 36 ports from Maine to Texas. And the USMX is an alliance of container carriers, direct employers, and port associations serving United States-based East and Gulf Coasts.

The current six-year labor deal between the parties was completed in September 2018 and covers roughly 14,500 U.S. East and Gulf Coast port workers. ILA said at the time of the deal’s completion that this six-year contract extension will bring generous pay increases, landmark protections against job-killing fully automated ports, and labor peace and stability through September 30, 2024.

ILA officials explained on June 10 that the organization cancelled Master Contract talks with the USMX upon learning that APM Terminals and Maersk Line are using an Auto Gate system that autonomously processes trucks without ILA labor, adding that this system, which was initially identified at the Port of Mobile, Alabama, is also being used at other ports, too.

An ILA spokesman called this another example of USMX members unilaterally circumventing the coast-wide Master Contract, calling it a “clear violation” of the agreement.

The following day, on June, 11 USMX issued a statement, saying that it met with the ILA for Local Contract negotiations over the previous two weeks.

“As is typical in our discussions, some issues will require further conversation between the local parties,” he said. “USMX looks forward to re-engaging with the ILA’s bargaining committee to jointly move local and Master Contract negotiations forward for the betterment of the USMX membership and the ILA rank-and-file.”

Melissa Atkins, a labor and employment lawyer, for Philadelphia-based Obermayer, a firm representing employers in all aspects of labor and employment law, including employment–related agreements, union negotiations, employee benefits, and employment litigation, recently told LM that it is likely the White House will help to resolve this current impasse. 

“What I think you are going to see is going to be similar to what we saw last year with the United Autoworkers (UAW),”  she said. “Everybody knows that the shipping industry, just like the car industry and the big three, has a tremendous effect on the GDP.  We're moving into back-to-school in September, and we're moving into the holiday season, and the White House, I believe, will absolutely get involved to make sure that they move forward with a contract and everything's not pushed back…and if we're revisiting 2021 when it when it comes to and 2020 when it comes to packaging and shipping and delivery, that is not ideal. The shipping industry is just really getting back on track, and people are getting packages on time, but then if they strike, you're going to be right back in the same situation.”