ILA Threatens Coastwide Strike Over Wage, Automation Dispute

The International Longshoremen’s Association (ILA), the largest maritime workers’ union in North America, has issued a warning of a coastwide strike set to begin on Oct. 1 if its demands for wage increases are not met. Negotiations between the ILA and the United States Maritime Alliance (USMX) remain at an impasse, and the existing ILA contract, which covers workers across the East and Gulf Coasts, is set to expire on Sept. 30.

The ILA, which represents over 85,000 longshoremen and went on its last strike in 1977, is demanding higher wages, arguing that pay has not kept pace with the billion-dollar profits of the ocean carriers that employ them. According to Harold Daggett, President, ILA, wages have seen minimal growth over the past three decades, with an average annual increase of just 2.02%, while inflation continues to erode workers’ purchasing power. “Inflation has eaten into any wage increases,” Daggett says. “Everything is more expensive compared to six years ago.”

Daggett labeled the USMX’s wage increase offer as inadequate, stating: “The ILA longshore workers deserve it, and the companies have the money to pay it.” The union also remains adamant against the introduction of further automation at ports, particularly the use of Auto Gate systems, which allow trucks to be processed without human labor.

Failed Negotiations and Federal Intervention

Negotiations between the ILA and USMX have been ongoing since May. However, they intensified after the union canceled talks in July in protest of automation technologies introduced by USMX-represented APM Terminals and Maersk. The ILA has refused to meet with USMX until these automation issues are resolved and until the union receives long-awaited reports on the impact of new technology on jobs.

“We will not entertain any discussions about extending the current contract, nor are we interested in any help from outside agencies to interfere in our negotiations with USMX,” says Daggett. “This includes the Biden Administration and the Department of Labor.”

The USMX, which represents major carriers, marine terminal operators, and port associations, says that it remains open to bargaining. However, it says that “time is running out if the ILA is unwilling to return to the table.” 

According to Reuters, with time running out, the US Department of Labor has reached out to USMX, signaling that the federal government is prepared to intervene if necessary to avoid a work stoppage.

SSGA and Maersk’s Take

Gary Williams, Director of Transportation, Specialty Soya and Grains Alliance (SSGA), says that the strike may have significant consequences for the US economy, as the East and Gulf Coast ports handle about 60% of the country’s container volume, valued at US$588 billion annually. 

Williams adds that the USMX offered a 32% pay increase, which the ILA rejected and demanded a 78% raise, reflecting its desire to share in the record profits achieved by carriers during the pandemic. He says that the strike, if it occurs, would create widespread disruption across all US ports, not just those on the East Coast and Gulf.

As a response, Maersk is warning customers to expedite cargo movements before the strike, noting that delays, increased costs, and logistical challenges could severely disrupt supply chains. The Danish shipping company also shares that the potential strike is already causing significant concern across industries reliant on US ports and warns that a strike would disrupt supply chains, leading to increased costs, delays, and logistical challenges. The company advises customers to expedite bookings and retrieve cargo ahead of the strike to minimize disruptions, urging them to put contingency plans in place, including alternative cargo routing options.

Neither the ILA nor the USMX responded to requests for comment.