Coming in June, the ILWU contract will expire and need to be renewed, leaving shippers, importers, exporters, and forwarders with concerns about delays or work stoppages that could happen if the negotiations falter. After a year plus of port delays, bottlenecks, and record delays, the looming specter of further delays and disruption, everyone is paying close attention to the way negotiations unfold between the longshoremen and Pacific Maritime Association (PMA).
Possible sticking issues include compensation and automation, which are fairly typical for the situation. After a banner year, longshoremen are going to be looking for compensation to match the amount of work they’re doing and the new pandemic-related conditions from which that work stems. In response, the PMA will be looking for improvements in automation to boost productivity and meet the frantic demands of the moment – a move that doesn’t bring the longshoremen comfort as automation often leads to a reduction in the workforce.
The situation itself is being closely watched by organizations from both the consumer sector and unions on the east coast, which has negotiations of their own next year. According to an interview with Freightwaves, NRF President Matthew Shay said in a letter to the PMA and ILWU leaders. “Both parties should attempt to reach a contract well before expiration for the benefit of the national economy and to provide the needed certainty to all the stakeholders in the supply chain that rely on the U.S. West Coast ports. We would further ask that you issue a statement committing to the commencement of meaningful negotiations now and to commit to continuing negotiating and working without interruption, even if negotiations extend beyond the June 30 contract expiration.”
Truly, it’s not difficult to see why the NRF would be concerned with even the idea of a strike should negotiations break down. When talks start to break down, it costs millions of dollars in lost productivity and causes a build-up in cargo at the port and the cargo leaving the port, creating disruptions across the supply chain. We at Coppersmith Global Logistics will keep watching this story as it unfolds and promise to update our readers as we learn more about how the summer will develop between the ILWU and the PMA. Contact your Coppersmith representative today if you have any questions or want to look into contingencies for a worst-case scenario.
