A tentative agreement reached on January 8, 2025 between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) has postponed a strike at over 40 ports, that was scheduled to begin on January 16.
While the six-year master contract averted immediate disruption, it must still be ratified by the ILA’s local wage-scale committees, keeping the threat of disruption alive, possibly until the Summer.
Timeline
The dispute began with the expiration of the previous labour contract in September 2024, triggering months of negotiations. A three-day strike in October briefly paralysed East and Gulf Coast ports, as dockworkers protested over unresolved issues of wages and automation. Although that strike was resolved with a significant wage increase and a temporary extension of the contract, automation remained a divisive issue.
Negotiations resumed in early January 2025, culminating in a tentative deal just days before the strike deadline. The agreement allows for limited semi-automation at ports, such as the use of rail-mounted gantry cranes, while guaranteeing union jobs directly tied to new technologies. “This agreement is a step forward in modernising our ports while protecting the livelihoods of our members,” said ILA President Harold Daggett in a statement following the announcement.
A breakthrough came on 20th December 2024, when President-elect Donald Trump met with Daggett in Florida. Trump publicly endorsed the ILA’s anti-automation stance, arguing that foreign-owned carriers should focus on investing in American workers rather than replacing them with fully automated systems. “American dockworkers are the backbone of our economy, and it’s time we protect their jobs,” Trump said. His intervention is widely credited with putting additional pressure on carriers to reach a compromise.
Mitigating risks
In anticipation of a possible strike, Global Forwarding implemented a range of contingency measures, including diverting shipments to West Coast ports, Canadian trans-loading, and expanding air freight capacity. These strategies remain in place, given that the ratification process could stretch into the summer of 2025 and the threat of renewed disruptions persists.
In advance of the threatened strikes carriers have imposed a range of surcharges such as “Port Congestion” and “Work Disruption”. Global Forwarding is urging carriers to rescind these fees now that a tentative agreement has been reached.
With ratification potentially extending into mid-2025, Global Forwarding’s expert team is here to provide strategic guidance, monitor developments, and offer customised solutions to optimise shipping routes, mitigate risks, and control costs.
To explore mitigation solutions for your business, EMAIL Adam Davies, Vice President.
