Possible East Coast Port Strike Has West Coast Anxious
With longshore workers up and down the East and Gulf coasts threatening to strike if contract negotiations aren’t resolved by Sept. 30, retailers and apparel manufacturers were checking their contingency plans to be ready to send cargo to the West Coast.
Contract negotiations between the International Longshoremen’s Association and the waterfront employers, represented by the United States Maritime Alliance (USMX), broke down on Aug. 22, canceling three days of negotiations that were to have taken place in Delray Beach, Fla. The dockworkers rejected a request to discuss employers’ proposals for changes to work rules at marine terminals that included overtime pay and container royalties.
ILA President Harold Daggett said the breakdown in negotiations means a strike is likely. ILA officials said they walked away from negotiations after waterfront employers laid down a take-it-or-leave-it ultimatum.
The USMX said it was disappointed with the uncompromising stand the ILA leadership was taking in the negotiations. “The ILA’s posture is contrary to the history of cooperation that has characterized these negotiations in the past and, since 1977, has led to agreements without any disruption to the supply chain and port operations on the East and Gulf coasts,” James Capo, USMX chairman and chief executive, said in a statement. “Management’s primary goal in these negotiations is to maintain the competitive position and market share of the ports by improving productivity and removing the inefficiencies that threaten the economic viability of the ports. For example, they include antiquated work rules that have made the Port of New York and New Jersey, which employs more ILA members than any of the 13 other East and Gulf Coast ports, the most expensive in the world.
“Unfortunately, the ILA leadership has been unwilling to have a meaningful discussion about these archaic practices, among them ‘low-slow jobs’ that pay some ILA members for 24 hours of work even if they are only on the job for a few hours a day.”
On Aug. 28, the maintenance workers at the ports of New York and New Jersey authorized their president to call a strike if contract negotiations aren’t concluded by Sept. 30. Local 1804-1 has 700 workers and is headed by Dennis Daggett, who is Harold Daggett’s son.
In response to the labor upheaval, the National Retail Federation urged the two sides to return to the bargaining table and wrap negotiations up by the deadline.
The retail association said the strike would occur during one of the heaviest shipping seasons in the year, when holiday goods are making their way across the water. “Now that there is a real risk of disruption, most retailers using the East and Gulf Coast ports will be forced to execute contingency plans within the next week to meet in-store holiday deadlines,” said NRF President and Chief Executive Matthew Shay. “These plans carry great expense, but they are necessary to avoid disruptions that will add costly delays to our members’ supply chains.”
John Salvo, co-president at Carmichael International Service, a Los Angeles customs brokerage and freight forwarder, said he has not seen any diversions yet but anticipates a change in shipping plans as the negotiating deadline looms closer.—Deborah Belgum
