Joseph Bonney, Senior Editor | Aug 27, 2012 12:54PM EDT
The National Retail Federation urged the International Longshoremen’s Association and waterfront employers to resume negotiations and avoid a work stoppage when the current East and Gulf Coast labor contract expires Sept. 30.
The ILA and United States Maritime Alliance broke off negotiations Wednesday, canceling three days of scheduled negotiations after the union rejected USMX’s request to discuss employers’ proposals for changes to work rules at marine terminals.
ILA President Harold Daggett said the breakdown in negotiations means a strike is likely.
The retail federation said a work stoppage during the peak season for holiday imports would be disastrous.
“We understand and recognize that there are tough issues that need to be resolved,” NRF President and CEO Matthew Shay said. “The issue will only be resolved, however, by agreeing to stay at the negotiating table until a final deal is reached. Failure to reach agreement will lead to supply chain disruptions which could seriously harm the U.S. economy.”
Shay noted that some retailers have already implemented contingency plans. “Now that there is a real risk of disruption, most retailers using the East and Gulf Coast ports will be forced to execute contingency plans within the next week to meet in-store holiday deadlines. These plans carry great expense, but they are necessary to avoid disruptions that will add costly delays to our members’ supply chains,” he said.
Shay’s comments came in a letter to Daggett and USMX Chairman and CEO James Capo.
The two parties were scheduled to hold three days of negotiations last week to replace the contract that expires Sept. 30, but the ILA walked away on Wednesday over USMX’s insistence to negotiate on terminal efficiency improvements.
Shay said the lack of a contract could drive shippers away from East and Gulf Coast ports in the same way that a 2002 West Coast port lockout caused shipping to shift in their favor.
“Having a secure, long-term longshore labor contract in place is critical to ensure that the East and Gulf Coast ports continue to benefit from growing labor volumes,” Shay said. “Without such certainty, retailers and others will surely re-evaluate their supply chains and the short-term and long-term reliance on these ports.”
The International Longshore and Warehouse Union’s contract for West Coast dockworkers doesn’t expire until mid-2014.
The ILA said it has seen “an explosion of support” from other labor organizations, including the ILWU, the International Transport Workers Federation and the International Dockworkers Council, with which the ILA affiliated last month.
Paddy Crumlin, president of the ITF and head of the Maritime Union of Australia, plans to meet with Daggett in early September to coordinate support from other ITF-affiliated unions, the ILA said.
Contact Joseph Bonney at jbonney@joc.com. Follow him on Twitter at @JosephBonney.