Glenn Taylor
·4 min read
The International Longshoremen’s Association (ILA) has called off master contract talks with their maritime employers, the United States Maritime Alliance (USMX), in a potentially significant blow to U.S. businesses looking to ship goods into East and Gulf Coast ports in the second half of 2024. The negotiations were initially scheduled for Tuesday.
The current coast-wide master contract is set to expire on Sept. 30, with the union pledging to strike in October if a new deal is not finalized.
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According to the ILA, the decision was made amid ongoing negotiations of local port contract agreements. The local negotiations were initially anticipated to be complete by May 17, but the union has not detailed which of the talks were still in flux. The ILA had expected master contract negotiations to resume when the local contracts are completed.
Master contract negotiations for some 45,000 dockworkers across 36 ports from Maine to Texas began in February 2023, but largely fizzled out in October after the ILA and USMX reportedly failed to agree on wage increases. The local talks restarted in February, when the May deadline was set.
“There’s a lot of fear. Customers always worry about the threat of a strike,” said Joseph Firrincieli, a sales supervisor at freight forwarder OEC Group. “What we’ve seen is a lot of volumes been shifted to the West Coast. I’m recommending to customers that if they’re importing cargo that can be delayed, it’s not life or death, then continue on shipping to the East Coast. If they’re genuinely concerned because of the East Coast delays and because of the potential strike, just ship the volume to the West Coast.”
Firrincieli noted if that it may be a matter of affordability for many shippers, in that those looking to shift goods over to the West Coast ports would have to transload the cargo and long-haul it to the East Coast, “which is very, very, expensive,” he said.
“Most importantly, it’s about customers having all the information ahead of time,” Firrincieli told Sourcing Journal. “Hope for the best, but expect the worst.”
Automation stalls ILA-USMX negotiations as union puts blame on Maersk
The union is walking away from the table due to one of its recurring sticking points in negotiations—the use of automation in ports.
The ILA said it discovered that Maersk-owned APM Terminals and Maersk Line are using an “Auto Gate” system at the Port of Mobile, Ala. This system powers the gate that enables trucks to enter and exit a terminal and be autonomously processed without ILA labor. This system is reportedly being used in other ports as well, the union said.
“There’s no point trying to negotiate a new agreement with the USMX when one of its major companies continues to violate our current agreement with the sole aim of eliminating ILA jobs through automation,” said ILA international president Harold J. Daggett, who serves as chief negotiator for the union.
Sourcing Journal reached out to the USMX for comment.
The ILA will not meet with USMX until the Auto Gate issue is resolved, the union said in a statement.
Additionally, the union is still waiting on results from an audit for jobs created out of new technology, a report they have been anticipating for almost two contract periods.
The ILA has observed “an increasing number” of IT personnel on marine terminals, and has concerns that APM and Maersk’s IT departments in Charlotte, N.C., are encroaching on their jurisdiction.
The union accused APM Terminals and Maersk Line of “repeated attempts to circumvent the ILA-USMX Master Contract,” saying that the introduction of automation and semi-automation equipment has led to ILA job losses in various ports.
“Most of the problems the ILA is facing on the East and Gulf Coast all stem from APM Terminals and Maersk Line,” the ILA added. “Maersk Line, the second largest ocean carrier in the world, has a track record of pushing automation. They started semi-automation in the Port of Hampton Roads, and have full automation at Pier 400 in Los Angeles, California. The ILA lost tens of thousands of jobs in the 1970s due to containerization, and APM and Maersk seem to be leading the charge to eliminate good, family-sustaining jobs right here in the U.S.”
Daggett and the ILA have called on the Biden administration to “recognize the threat posed by foreign-owned companies attempting to undermine American jobs,” expressing criticism of the commander in chief and U.S. lawmakers on allegations that they are “turning a blind eye to automation” and its alleged impacts on American workers.
“How can this administration allow a foreign company like Maersk, and other foreign shipping companies, to get away with this?” Daggett said in remarks last July during the union’s quadrennial convention remarks. At the time, he warned foreign-owned container shipping firms and terminals of the consequences of their plans to automate. “Mark my words, there is going to be an explosion, and the ILA and dockers around the world are going to light the fuse.”
