Here’s the latest on the ongoing contract negotiations between the Pacific Maritime Association (PMA) and International Longshore & Warehouse Union (ILWU). We give you a timeline of what’s been happening since 2015, what is likely ahead, and our take on the whole situation.
What’s the situation?
The current contract between Pacific Maritime Association (PMA) and International Longshore & Warehouse Union (ILWU) expires on July 1, 2022. The PMA requested the ILWU extend its current labor contract for another year, to July 1, 2023. The PMA promoted the extension as a “necessary step to protect commerce and our economy during this recovery period.” The ILWU has rejected that proposal.
ILWU President Willie Adams said in a recent statement, “The employer is now asking for an extension to that extension. We’ve been waiting for seven years to address issues that are important to dockworkers.”
Wait, let’s back up and see some history:
In the past, negotiations were lengthy and contentious.
- In 2015, they finally reached a deal only after intervention by the Obama administration
- The 2014-15 contract negotiations resulted in crippling ILWU work slowdowns and a PMA response that included cessation of lucrative night and weekend work for longshoremen (West Coast ports went into gridlock for almost four months)
- Exporters, especially agricultural exporters who must ship their perishable cargo through the closest port, were hurting from the loss of business, some of which was lost indefinitely
- Loss of market share was a major concern for terminal operators after 2014-2015 contract resolutions
- In 2017, wanting to avoid the crippling effects of work slowdowns and stoppages that occurred with the 2014-2015 negotiations, the ILWU approved a three-year contract extension through July 2022.
What we think is going to happen:
- Despite contract language allowing automation and the three terminals that have implemented automation since 2008, the ILWU has increasingly come to see automation as an existential threat and a microcosm of the larger threat of robotics displacing human labor
- Some observers believe that employers will be unwilling to concede to any rollback of their rights to automate when the current agreement expires on July 1, 2022. The primary reason is that cargo handling costs on the West Coast are going up owing to regulation, and as the port range continues to lose market share to Canada and the US East and Gulf coasts. Automation, although expensive to implement, is an option terminal need in order to address rising costs.
- On top of this, there is the estimated $4 billion marine terminal operators will have to spend to install zero carbon cargo handling equipment at LA–Long Beach terminals in compliance with the 2030 Clean Air Action Plan
- This article gives a good a background on where both sides are coming from.
Wrapping it all up:
We believe negotiations are going to be intense and could drag on. The ILWU will feel they have leverage because of the supply chain issues caused by COVID-19, the current labor shortages, and the success of other recent strikes and contract negotiations.
While it is difficult to estimate the length of negotiations or a potential strike until we get closer to July 1, 2022 when the current agreement expires, our team is committed to keeping you informed of what’s going on legally that impacts our industry.
Until next time!