US East Coast Ports Union Discusses Wage Demands and Potential Strike, Reports Reuters

By Abhinav Parmar and Lisa Baertlein

The International Longshoremen’s Association (ILA) union, which represents 45,000 workers at major container ports from Texas to Maine, commenced two days of meetings on Wednesday to discuss wage demands and prepare for a possible strike on October 1.

Formal negotiations have reached a stalemate, as the union and the United States Maritime Alliance (USMX) employer group continue to debate issues related to pay, terminal automation, healthcare coverage, and retirement benefits.

According to a source familiar with the discussions, the ILA is seeking a 77% pay increase over the duration of the new contract. Experts believe the final pay raise is likely to surpass the 32% increase negotiated by the longshore union on the West Coast last year.

ILA International President Harold Daggett has warned that workers will strike if a new labor agreement is not finalized before the current six-year contract expires on September 30. Daggett, who serves as the union’s chief negotiator, stated in a video message, "The ILA most definitely will hit the streets on October 1 if we don’t get the kind of contract we deserve."

The USMX has previously expressed its desire to meet with the ILA to resume negotiations.

Any work slowdown or stoppage could impact key ports, including New York/New Jersey, Houston, and Charleston, South Carolina. This would likely lead to delays in the delivery of goods just ahead of the holiday season and U.S. presidential elections.

Such disruptions may have "serious ripple effects" on global supply chains already strained by Red Sea diversions, according to Vincent Clerc, CEO of A.P. Moller-Maersk, who spoke at an event in Los Angeles last week. Maersk is a member of USMX. When asked about the negotiations, Clerc reflected on previous instances where negotiators successfully reached agreements despite challenges.

In response to the uncertainty, shippers relying on the affected ports are taking precautions and bringing in goods earlier to minimize risk.

However, as each day passes without a resolution, concerns about a potential strike continue to grow.

The National Retail Federation (NRF) recently urged both parties to return to negotiations, joining similar calls from the Retail Industry Leaders Association and the American Apparel & Footwear Association. NRF CEO Matthew Shay emphasized that "a strike or other disruption would significantly impact retailers, consumers, and the economy," urging the administration to provide necessary support to facilitate a new contract agreement.