Following another month of fears that the US East Coast and Gulf ports could be hit by a widespread strike by longshoremen, the Federal Mediation and Conciliation Service (FMCS) has announced that a tentative agreement has been reached between the United States Maritime Alliance (USMX) and the International Longshoremen’s Association (ILA).

Discussions between the ILA and the USMX, which represents container carriers, direct employers and port associations, concerned overtime rules and container royalties, the payments made to union workers based on the weight of cargo received at each port. Those discussions broke down in September last year and the imminent possibility of 15,000 ILA union members stopping work threatened ports along the East Coast and Gulf Coast ports, include Baltimore, Brunswick and Jacksonville, as well as the port of New Jersey and New York, some of the busiest ports in North America (read more here). Collective bargaining extensions were made at the end of September and December.

While not a direct threat to vehicle terminals at the ports, all container throughput, as well as machinery, equipment and other project cargo in the high and heavy sector have been under threat. Carmakers have been making preparations in advance of any action for parts shipments to their assembly facilities, with contingency plans in place for shipments to move via other ports such as Halifax on the Canadian East Coast or through Vancouver port on the West Coast.

Stalemate in discussions
The deadlock between the two associations that has maintained the threat since last autumn has become vituperative at points, with the USMX arguing that the overtime rules and container royalties were “archaic and resulted in millions of dollars being paid for time not worked”. Chairman James Capo referred to inefficiencies that were causing many ports to become prohibitively expensive, harming their competitive ability and threatening the long-term viability of operations.
ILA president Harold J Daggett countered that USMX had called for the union to give up its eight-hour work guarantee and demanded that the ILA radically change the “hard-fought contractual rules” for the payment of overtime – issues that “should not even have been part of the master contract discussions.

The FMCS said that it would not disclose details of the “substantive provisions that have been reached” until the outstanding ratification procedures had been concluded but in a statement FMCS director George H. Cohen said: “I am extremely pleased to announce that the parties have reached a tentative agreement for a comprehensive successor Master Agreement.”

He noted that it was subject to ratification by both parties and to agreements being reached in a number of local union negotiations. “Those local negotiations are ongoing and will continue without interruption to any port operation,” said Cohen. He added, “collective bargaining has proven its worth by avoiding a potential work stoppage that would have had a severe negative impact on the nation’s economy.”