The International Longshoremen’s Association (ILA) has recently put a halt to its negotiations with the United States Maritime Alliance (USMX) concerning a new labor contract. This suspension elevates the risk of potential strikes at East Coast and Gulf Coast ports. The ILA, which represents approximately 85,000 union workers, ceased discussions upon discovering that APM Terminals (APMT) and Maersk employed automated technology for processing trucks at port terminals, circumventing union labor.
According to a CNBC report, the ILA pointed out the use of an ‘auto-gate’ system at the Port of Mobile, Alabama, and suggested that similar technologies are in operation at other ports. ILA President Harold J. Daggett condemned the implementation of automation, labeling it as a violation of their coast-wide Master Contract with USMX.
“This action clearly breaches our agreement with USMX, and we will not stand for it any longer,” stated Daggett. “There’s no value in negotiating a new agreement when one of its key members continues to violate our existing contract by pushing for automation that threatens ILA jobs.”
Contrary to the ILA’s assertions, a Maersk spokesperson claimed that APMT is “fully compliant with the ILA/USMX Master Contract” and expressed regret over the ILA’s selective public disclosure of negotiation details.
The ILA-USMX master contract, which encompasses terminal operators and ocean carriers, is scheduled to expire on September 30. The ILA had set a deadline of May 17 for local contracts to be resolved to streamline the overall contract negotiations. Nevertheless, the cessation of talks stems from unresolved matters related to “ongoing negotiations of local agreements under the coast-wide Master Contract.”
ILA President Daggett has consistently advocated for a favorable economic deal for union members, opposed port automation, and sought exclusive contracts for union workers. Despite a history of compromises and agreements between the ILA and USMX, the possibility of strikes is a growing concern, especially as cargo orders start to revert to West Coast ports in anticipation of the peak shipping season.
Past disruptions, like the 13-day strike at ILWU Canadian West Coast Ports, left over $12 billion in trade stalled and redirected cargo flows to East Coast ports. Port insiders suggest that the ILA is aiming for a pay raise exceeding the 32% secured by the ILWU in its recent six-year deal, as reported by CNBC.
The ILA’s firm stance and the suspension of negotiations highlight the precarious state of labor relations at key U.S. ports, posing significant ramifications for the shipping and logistics industry as the threat of strikes looms large.
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Young Chiu is a seasoned logistics expert with over 15 years of experience in international freight forwarding and supply chain management. As CEO of Dantful International Logistics, Young is dedicated to providing valuable insights and practical advice to businesses navigating the complexities of global shipping.
