Legal and Other Issues Being Resolved by Port Strike

Parties to the Dispute

The union and management teams reached a settlement agreement that was announced on October 4, 2024 to end the port strike. The settlement does not resolve the issues, but extends the master contract to Jan. 15, 2025, to allow the sides to negotiate outstanding issues. A final agreement must be ratified by union members. The 2024 U.S. port strike involved nearly 50,000 dockworkers from the International Longshoremen’s Association, AFL-CIO, (ILA), and affected 36 ports along the East and Gulf coasts, including New York/New Jersey, Houston, Savannah, and Miami. The ILA has a total membership of 85,000 longshore workers employed at ports on the Atlantic and Gulf Coasts; major U.S. rivers; Great Lakes region, Puerto Rico, Eastern Canada and the Bahamas. The ILA remains in contract negotiations with the United States Maritime Alliance, Ltd. (USMX), which represents employers of the maritime industry (in the ports from Maine to Texas) who are responsible for the transportation and handling of cargo shipped to and from the United States. It was the first longshoremen strike by the ILA since 1977, when a 100-day strike affected ports along the East and Gulf Coasts of the United States. Had it continued longer, the strike would have impacted between 43%-49% of all U.S. imports and billions of dollars in trade monthly that move through the U.S. East Coast and Gulf ports.

The Settlement and Ongoing Issues for Negotiation

The key issues at stake are job security, especially around automation of the ports and significant increases in wages and benefits. Under the Master Contract between ILA and USMX that expired September 30, the ILA sought increases to the wage ceiling for longshoremen from $39.00 per hour to match the ceiling for West Coast dockworkers, which is $55.00 per hour, with higher rates for skilled positions such as crane operators. The reported wage settlement provides a pay raise of 61%, or $4 per hour over each of the six years of the pact, resulting in a final wage ceiling for the highest paid workers of $63.00 per hour. The ILA is also seeking guarantees that the management alliance will negotiate automation guidelines that will protect jobs by defining the types of technologies used at ports, effects of staffing, whether jobs are eliminated or created by new technologies, training and related matters. The union foresees significant threats to its membership posed by automation that is much more common in Europe and even the U.S. West Coast where labor shortages are more common than on the U.S. East and Gulf Coasts. They seek increased operational efficiency coupled with job security as ports automate further. The U.S. Government Accountability Office (GAO), which provides fact-based, nonpartisan information to Congress, published a report, U.S. Ports Have Adopted Some Automation Technologies and Report Varied Effects, (GAO-24-106498) in March 2024, that studied the effects on automation at the 10 largest U.S. ports. According to the GAO, all ten of the ports use some form of automation to process and handle cargo with mixed results as to whether automation improved efficiency and whether jobs were threatened or eliminated. Clearly the ILA sees intensive automation at U.S. ports as a major threat to jobs, while the USMX members, many of whom are foreign, are familiar with shipping to and from ports like Rotterdam that are more automated than U.S. East and Gulf Coast ports.

CBP Position

According to International Trade Today (ITT), importers have significant questions about how they can comply with U.S. Customs and Border Protection (CBP) regulations. “CBP is still planning to uphold the 15-day rule for cargo unlading, according to Susan Thomas, executive director of Cargo and Conveyance Security in CBP’s Office of Field Operations. CBP is also advising that all necessary manifest updates, port of unlading adjustments and inbound movements must be promptly reported, with any changes to the port of entry updated in ACE, Thomas said on the call. Importers and carriers are also encouraged to submit entry documentation prior to cargo arrival to expedite processing; carriers are also encouraged to consider alternative routing vessels to non-impacted ports to minimize delays, according to CBP.” (ITT, October 1, 2024). An important technical question for importers is how CBP will define its position on date of arrival given the arrival date for vessels as defined in 19 CFR Part 4, “The phrase “arrival of a vessel” means that time when the vessel first comes to rest, whether at anchor or at a dock, in any harbor within the Customs territory of the U.S.” This definition is different than “entry” as defined by 19 CFR Part 141, ““Entry” means that documentation or data required by § 142.3 of this chapter to be filed with the appropriate CBP officer or submitted electronically to the Automated Commercial Environment (ACE) or any other CBP-authorized electronic data interchange system to secure the release of imported merchandise from CBP custody, or the act of filing that documentation.” In addition, the provisions of 19 CFR § 4.36, Delayed Discharge of Cargo, will clearly become important for carriers if the strike proceeds for more than 15 days, the period for unloading under 19 CFR § 4.37(a), General Order. The provisions of 19 CFR § 4.38, Release of Cargo, will clearly be important for importers as well. Other questions CBP will need to address revolve around how C-TPAT members will obtain their benefits as trusted partners in the fight against terrorism and whether entry summaries and duty payments would be due before release of the cargo if it is stuck awaiting unlading at the effected ports.

Taft-Hartley and the White House Position

The Labor Management Relations Act of 1947, commonly known as the Taft-Hartley Act, (29 U.S.C. §§ 141-197), regulates labor practices and collective bargaining in the U.S. It prohibits certain union activities and allows the President to intervene in strikes deemed to harm national health or safety. The President has the power under the law to suspend a strike for an 80-day “cooling off period” in such cases. Because of the brevity of the strike, the President is no longer under pressure to invoke Taft-Hartley.