UPDATE: via The American Prospect
Negotiations loom between the dockworkers union and shipping companies making record profits.
In December 2021, the top ten publicly listed shipping companies were on track to earn a record $115 billion in profits. Maersk, the world’s second-largest shipping company, posted its most profitable quarter in 117 years in November 2021. Now, this profit bonanza is the backdrop of upcoming labor negotiations between dockworkers and shipping companies. Negotiations are set to begin in early 2022 between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) over a new contract before the current one expires on July 1st.
The PMA, which represents 70 ocean carriers operating terminals at 29 West Coast ports, has tried to delay negotiations by pointing to the ongoing supply chain crisis. In a November 2021 letter, PMA President Jim McKenna said he was concerned that negotiations could lead to further “disruption” of the supply chain. In a same-day response, ILWU President Willie Adams rejected the PMA’s request for an extension, which would have been the second delay in negotiations after a 2019 extension delayed talks for three years. Adams rebuked the idea that supply chain delays justified an extension, telling The Journal of Commerce online that collective bargaining should be welcomed “as fundamental to the wellbeing of our ports rather than prognosticating disaster.” The new contract will affect 22,400 dockworkers who staff ports from Washington state to Southern California.
While the details of union demands will be ironed out in the union caucus at the beginning of 2022, the COVID-19 pandemic has highlighted the urgency of issues like safety and pay that may be raised in negotiations. ILWU members have worked longer hours processing more cargo than usual during the pandemic. Workers at the Ports of Los Angeles and Long Beach moved a record equivalent of ten million 20-foot containers in the first half of 2021. Ports have remained open and operational throughout the pandemic, exposing longshore workers to health risks. At least 20 ILWU members have died of COVID-19.
Labor negotiations that could disrupt operations come at an inconvenient time for shipping companies reaping once-in-a-lifetime profits. In his response to McKenna, Adams highlighted that shipping companies have made “historic profits off the backs of ILWU dockworkers” and included three pages of headlines about shippers’ record profits.
In past negotiations, supply chain disruptions have resulted from management pressure tactics. During 2002 negotiations, the PMA locked out dockworkers for 11 days until President Bush invoked the Taft-Hartley Act to forcibly open the ports. In 2014, the PMA similarly ended night and weekend work shifts. But such tactics may not be politically feasible this time around due to the supply chain crisis. Passage of an ocean shipping bill that would regulate the major carriers and President Biden’s plan to run port operations 24/7 indicate that the administration and bipartisan members of Congress are prioritizing easing supply chain issues, even at the expense of shipping company profits.
One sticking point in negotiations could be terminal operators seeking to expand their use of automated technology, which union officials have opposed over job loss concerns. In previous negotiations, shipping companies have also tried to limit the jurisdiction of the ILWU by reducing the categories of work performed by union workers. With these contentious issues looming, ILWU President Adams has told members to gear up for a fight: “There may be a battle in 2022. Be prepared.”
What does this mean for Sunset customers?
International Longshore and Warehouse Union (ILWU) contracts expire July 1, 2022 for dockworkers from Washington state to Southern California. If negotiations do not proceed smoothly, we could see a union strike at one of the most congested ports in the nation, Los Angeles/Long Beach, California. A union strike or port lockout could further disrupt an already unstable supply chain, causing additional weeks of delays.
Sunset is here to help with the most basic or complex shipments. Email International@SunsetTrans.com to speak further about how to manage any International needs that arise.