East Coast and Gulf Coast Labor Negotiations and Potential Supply Chain Impact
Last Updated: 6/26/2024
Current Status of Labor Negotiations
Labor negotiations are ongoing between the International Longshoremen’s Association (ILA), representing dock workers on the East Coast and Gulf Coast, and the United States Maritime Alliance (USMX), representing port terminal operators and ocean carriers on the East Coast. The negotiations impact 36 ports along the East Coast and Gulf Coast, from Maine to Texas.
Timeline of Significant Event in the Negotiations
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Early 2024: Beginning of contract negotiations
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May 17, 2024: Deadline for local contracts to be agreed upon to facilitate a master contract negotiation
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June 10, 2024: ILA suspends negotiations due to use of automation at multiple ports
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September 30, 2024: Expiration date of the current six-year contract between the ILA and USMX
Recent Development and Current Status
Both the ILA and USMX have committed to reaching a new agreement before the September 30 deadline. However, concerns remain about the potential for a disruption in port operations if negotiations do not result in a satisfactory contract. The last major disruption involving the ILA occurred in 1977 and lasted 44 days.
On June 10, 2024, the ILA suspended negotiations due to multiple ports using an auto gate system that autonomously processes trucks.
Relevant Links and References
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USMX press release on Master Contract negotiations beginning after 5/17/24 deadline for Local Ports Negotiations.
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March 2024 CNBC report on ILA and USMX negotiation.
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May 2024 Supply Chain Dive report on shipper contingency plans.
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May 2024 Retail Industrial Leader Association blog on the possibility of a port labor showdown in 20 weeks.
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June 11, 2024 Supply Chain Dive report on the ILA suspending negotiations.
Potential Impact on Supply Chains
A failure to reach an agreement could lead to a disruption in port operations starting as soon as October 2024. The uncertainty surrounding the negotiations has prompted some logistics managers to adjust their planning, pulling forward peak season freight orders to June. Shippers are also taking precautionary measures, such as shifting cargo to West Coast ports.
A disruption in operations at East Coast and Gulf Coast ports could delay shipment of raw materials used to produce chemicals used for water and wastewater treatment. It could also delay manufactured goods used by water and wastewater utilities, such as vehicles and equipment with computer chips.
How Water and Wastewater Utilities Can Prepare for Potential Supply Chain Disruptions
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Identify mutual aid and assistance opportunities. Join your Water and Wastewater Agency Response Network (WARN) and contact other mutual aid networks and nearby water/wastewater utilities directly to discuss arrangements for receiving assistance in the event of a supply chain disruption.
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Access EPA resources. Visit Water and Wastewater Sector Supply Chain Resilience to access resources your utility can use to prepare for, or respond to, a potential supply chain disruption.