News / East coast port strike looms larger as union takes a tough stance on wages

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The International Longshoremen Association (ILA), which represents some 85,000 port workers along the eastern seaboard and Gulf coast ports, is displaying a determined stance in its face-off with port employers over a new labour contract.

Having suspended contract negotiations with the US Maritime Alliance (USMX), which represents employers at east and Gulf coast ports, on Monday because of a dispute over automation, ILA leadership has signalled a hard line on the issue of remuneration in the new labour agreement due to begin on 1 October.

The union wants substantial wage increases for members, citing the high profits of container lines. In a Facebook post it stated: “USMX member-companies’ profits are enormous, amounting to billions of dollars, and the ILA will demand wage increase commensurate with these revenues.”

According to some reports, the ILA is seeking wage hikes in excess of the 32% rise the International Longshore and Warehouse Union secured for its members at US west coast ports last year, in its six-year agreement with waterfront employers. And last summer, the ILA indicated that its Great Lakes district had secured a 40% increase in wages and benefits.

The ILA declared on Monday it would not start contract negotiations before settling its dispute over terminal automation. It accused Maersk of violating labour agreements by deploying an autonomous gate system to process trucks at the port of Mobile. The shipping line dismissed the accusation, arguing that it has been operating in compliance with the ILA-USMX master contract.

However, the ILA leadership appears determined to take a stand on the issue. Its president, Harold  Daggett, said: “Companies like Maersk are repeatedly trying to eliminate ILA jobs with the introduction of automation while raking in billions of dollars. They are in for a rude awakening.”

He invoked the spectre of a shutdown that could paralyse operations across the 36 ports between Maine and Texas covered by the USMX-ILA agreement.

“The threat of a coast-wide strike on 1 October, is becoming more likely, as USMX and its member companies drag their feet,”said Mr Daggett.

The ILA’s stance suggests that, besides sending a message to USMX members, it is looking to cause cargo owners to reconsider routing their cargo to alternative gateways.

Cargo statistics from the port complex of Los Angeles and Long Beach in the first four months of this year show gains in traffic, but only a moderate shift in flows from ports in the east. Gene Seroka, executive director of the port of Los Angeles, recently estimated that 2% to 5% of cargo had moved back to the west coast gateway from ports in the east.

But he added that more shippers might migrate their inbound flows to west coast ports if the ILA-USMX contract negotiations were to break down.

Bob Imbriani, SVP international at forwarder Team Worldwide, thinks cargo owners have been too busy with current disruptions to spend much time thinking about the ILA-USMX dispute.

“A strike wouldn’t happen till October, so people feel a decision on that can wait,” he said.

Indeed shippers have not been swayed to make substantial changes in their routing arrangements so far. At LA, container throughput was down 3% year on year last month, while volumes at neighbouring Long Beach dropped 8.2%, with imports down 4.5%.