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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. The move comes as unions, governing bodies representing shipping companies, terminal operators and port authorities have reached a tentative agreement on wages.
A person familiar with the negotiations told CNN that the wage agreement calls for a $4-an-hour raise in each year of the six-year contract. This represents a first-year raise of just over 10% over the current contract's maximum wage of $39 an hour. Five subsequent raises will result in a 62% increase in wages over the life of the contract.
The union agreed to extend the contract it signed with the United States Maritime Union, a governing body known as USMX that represents shipping lines, terminal operators and port authorities. The agreement, which had expired at the end of Monday, has been extended to Jan. 15, allowing union members to return to work until final details are worked out on a full agreement and approved by rank-and-file labor. It turns out. .
President Joe Biden praised the interim wage agreement in a statement.
“Today's tentative agreement on record wages and an extension of the collective bargaining process marks important progress towards a strong contract,” he said in a statement. “I congratulate the ILA longshoremen who have made tremendous sacrifices to keep our ports open during the pandemic and deserve a strong contract. And I congratulate the port operators and carriers who are members of the US Maritime Alliance. We congratulate them on their hard work and strong proposals.”
50,000 union members working at ports from Maine to Texas have been on strike since early Tuesday morning, halting the flow of most containerized imports into the U.S., along with much of the exports, and disrupting U.S. companies' ability to sell overseas. is causing .
For the interim agreement to enter into force, it must be ratified by ordinary ILA members. But unions agreed on Friday to let workers return to work because ships stranded at sea cannot come to U.S. ports to load or unload goods.
Still, strikes could start again if member states vote against the deal. And such rejection of a temporary collective bargaining agreement is not unprecedented.
Just last month, the International Association of Machinists (IAM) and jet maker Boeing reached a tentative agreement, with union leaders and 33,000 members recommending that they accept the deal, the best deal they've ever negotiated with the company. He even said it was an agreement. However, union members rejected the proposal almost unanimously and have been on strike since September 13th.
The port strike was still in its early stages, but the longer it lasted, the more widespread it would have had on the U.S. economy.
Business groups are calling on the Biden administration to order the strikers to return to work. Work stoppages have threatened supplies of everything from bananas to alcohol to European luxury cars, with less than two months left for the busy holiday shopping season. And these shortages may have put upward pressure on prices.
But President Joe Biden declined to use his authority under the Taft-Hartley Act to stop or call off strikes and said he would not interfere with the collective bargaining process. Mr. Biden, Vice President Kamala Harris and Transportation Secretary Pete Buttigieg have all called on USMX to negotiate a deal with ILA that would fairly distribute the record profits to its members.
Shipping costs soared during and immediately after the pandemic as supply chains were disrupted and demand soared. According to analyst John McCown, industry profits from 2020 to 2023 will exceed $400 billion, more than the industry has ever earned since containerization began in 1957. It is thought that.
USMX announced Monday that it has offered workers nearly 50% raises over the six years of their contracts. This will be an average annual wage increase of $3 per hour on top of the current maximum hourly base salary of $39. ILA President Harold Daggett said the union had been demanding an annual wage of $5 an hour. That would mean hourly wages would increase by about 77% over the term of the contract.
Shortly after the strike began Tuesday morning, Daggett said the union was prepared to consider the Biden administration's recommendation that both sides agree to a $4 hourly wage increase, but USMX proposed a $3 hourly wage increase. At that time, the union said it did not respond. Demand is back to $5 an hour.
This story has been updated with additional context and development.
CNN's Sam Fossum contributed reporting.
