Striking longshoremen return to work on Friday as negotiators reach an agreement on wages

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CNN
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Striking members of the International Longshoremen's Association will return to work at the ports on Friday, the union announced Thursday evening, after the union and the management group representing shipping companies, terminal operators and port authorities reached a tentative agreement on wages.

The union agreed to extend its contract with the United States Maritime Alliance, the USMX management group that represents shipping companies, terminal operators and port authorities. That contract, which expired at the end of Monday, will now be extended until January 15th and will keep union members back in office while the final details are worked out in a full agreement and ratified by the rank and file.

Terms of the tentative wage agreement were not immediately available Thursday evening.

The union's 50,000 members, who work at ports from Maine to Texas, have been on strike since early Tuesday morning, halting the flow of most container imports into the United States as well as numerous exports, hurting American companies' sales abroad.

A provisional agreement would still have to be ratified by rank-and-file ILA members before it comes into force. But with ships stuck at sea unable to enter U.S. ports to unload and load goods, the union has agreed to allow workers to return to work on Friday.

However, if members vote against the deal, the strike could begin again. And such a rejection of a temporary employment agreement is not uncommon.

Just last month, the International Association of Machinists (IAM) and aircraft manufacturer Boeing reached a tentative agreement that union leaders recommended to their 33,000 members and even described as the best agreement they had ever negotiated with the company. But union members voted almost unanimously to reject it and continued to strike since September 13th.

Although the port strike was still in its early stages, it would have had far-reaching effects on the US economy as it continued.

Business groups have called on the Biden administration to ban strikers from returning to work. The work stoppage threatened supplies of everything from bananas to liquor to luxury European cars, all while the busy holiday shopping season is less than two months away. And these shortages could have put upward pressure on prices.

However, President Joe Biden had refused to use his powers under the Taft-Hartley Act to block or end the strike and said he would not interfere in the collective bargaining process. Biden, Vice President Kamala Harris and Transportation Secretary Pete Buttigieg had all called on the USMX to negotiate a deal with the ILA that would fairly divide record profits among members.

Shipping costs skyrocketed during and immediately after the pandemic as supply chains collapsed and demand increased. According to analyst John McCown, the industry's profits from 2020 to 2023 totaled over $400 billion, which is believed to be more than the industry had made as a whole since containerization began in 1957.

USMX said Monday that it had offered workers a pay increase of nearly 50% over the six-year term of the contract, an average increase of $3 an hour per year, in addition to the current top base hourly wage of $39 -Dollar. According to ILA President Harold Daggett, the union had demanded $5 an hour per year. This would have increased the hourly wage by approximately 77% over the life of the contract.

Daggett said shortly after the strike began Tuesday morning that the union had agreed to consider a recommendation from the Biden administration that both sides agree to a $4 an hour wage increase, But when USMX proposed the $3 increase, the union went back to its demand of $5 an hour.

This story has been updated with additional context and developments.