The possible strike by 14,500 longshoremen at 14 major East Coast ports, which was set to begin on December 30, was averted last Friday. The main issue of contention between the International Longshoremen’s Association and the U.S. Maritime Alliance was container royalties–payments made to workers based on how much cargo they handle.
The two sides reached an agreement regarding the royalty payment on December 28, one day before the existing contract was set to expire and the day port workers threatened to walk off the job. The existing contract has been extended by 30 days through January 28, 2013 in an effort to negotiate the remaining issues in the negotiations.
George Cohen, director of the Federal Mediation and Conciliation Service (FMCS), which has been serving as mediator through out the talks said in a statement “Given that negotiations will be continuing and consistent with the agency’s commitment of confidentiality to the parties, FMCS shall not disclose the substance of the container royalty payment agreement. What I can report is that the agreement on this important subject represents a major positive step toward achieving an overall collective bargaining agreement. While some significant issues remain in contention, I am cautiously optimistic that they can be resolved in the upcoming 30-day extension period.”
The last time a strike of similar size occurred in the East and Gulf Coast, the U.S. economy lost some $1.0 billion a day, according to several reports. There has not been a strike in those ports in 35 years. The shipping industry has been hit hard this year, first by Hurricane Sandy and then an eight-day strike among the Longshoremen in Los Angeles.
