The contract covering the International Longshore and Warehouse Union (ILWU), which is the union representing U.S. West Coast port workers, expired July 1, and will not be extended. However, the ILWU and management, the Pacific Maritime Association (PMA), shared a joint release stating they will continue negotiations without work disruptions until an agreement can be reached. Furthermore, their release stated both parties understand the “strategic importance of the ports to the local, regional, and U.S. economies.”
In previous contract years, the parties also failed to meet the contract expiration deadline, so these circumstances are not unusual. This year’s contract discussions are not as contentious as previous years, such as in 2002's talks that resulted in a 10-day employer lockout of longshoremen. Major issues being addressed are wages, safety, jurisdiction and medical insurance. Some trade professionals have predicted a three-year contract will be considered to allow talks to be tabled concerning the “Cadillac” tax included in the national Affordable Health Care Act.
Meanwhile, cargo volumes at the ports of Los Angeles and Long Beach have picked up over the last two months as shippers tried importing goods prior to the ILWU contract expiration. Due to the spike in traffic, the ports are experiencing extreme congestion especially affecting chassis availability and container freight stations (CFS) capacities.
CBP Provides Contingency Plans in Event of a Strike
U.S. Customs and Border Protection (CBP) has published proactive guidance regarding operating procedures in the event of a West Coast strike or disruption. The interim procedures address communications and entry processing under different possible scenarios, including vessels diverted to other U.S. or foreign ports and anchored vessels carrying cargo. These guidelines are only effective in the event of U.S. West Coast port disruptions.