Dive Brief:

• The United States Maritime Alliance (USMX), which represents the port associations, carriers, and direct employers of the U.S. East and Gulf Coasts, issued a statement Wednesday claiming a strike by the International Longshoremen's Association (ILA) would violate the two sides' Master Contract.
• The USMX notes the contract "forbids any unilateral work stoppage by the ILA for any reason." The employers also added that if the ILA does in fact engage in a walkout, the USMX will act on behalf of its members and fully enforce their contractual rights. 
• Roughly 15,000 are expected to protest within a month, but doubt exists as to whether the events are officially sanctioned by the ILA. American Shipper reports that the strike announcement was issued, not by the ILA, but by a PR firm, although the members cited in the statement assure the strike is legitimate.  

Dive Insight:

Earlier this week, a press release seemingly issued by the ILA called for a shutdown of ports along the U.S. East and Gulf Coasts and a day-long march on Washington, D.C. The statement cited a loss of jobs due to automation and over-regulation at the ports of New York and New Jersey and South Carolina. While a date will not be set until next week, an ILA leader noted the protest would occur within the next 30 days. 

However, the USMX statement makes it clear such a strike could endanger not just relations, but violate the Master Contract's "no strike" clause, which was agreed upon by both parties in 2016. According to this clause, "the ILA agrees that there shall be no strikes or work stoppages by the employees, except as permitted in the Containerization Agreement and in Article XIV, Section 6(g)" of the contract. 

In other words, despite the USMX's claim that the ILA cannot unilaterally stop work for any reason, there appears to be two procedures by which such actions may proceed. While the ILA has not made its process clear, given the decentralized nature of its announcement, the language in the press release suggests its actions may fall under these two categories.

The first course of action involves the Containerization Agreement within the contract. The agreement assures that ILA employees will perform all "container work which historically been performed by longshoremen." The second clause adds, "the direct employers and their agents shall not contract out any work covered by this agreement. Any violations of this provision shall be considered a breach of contract." While the agreement does not explicitly permit a strike, it does note the union has a "right to insist" upon compensation for such violations.

The ILA press release announcing the protest points out the case of South Carolina, which "uses non-ILA members to operate cranes, receive and deliver cargo, and perform other terminal work," per the union. While it does not explicitly refer to this as a violation of the agreement, the implications of a breach is clear. In fact, last month, ILA workers in Charleston forced a port slowdown, protesting this issue.

Meanwhile, the ILA could also pursue a second option to skirt the no-strike clause: an official dispute and arbitration. 

Under Article XIV, Section 6(g) of the Master Contract, either party could submit a grievance to a Local Industry Grievance Committee and, if denied, appeal to the Industry Appellate Committee. If either committee grants the dispute, arbitration would ensue and, if enforcement fails, it could be considered a breach of contract. The two-step process would take a maximum of 10 days for the first stage and 20 days in the second stage before arbitration. The ILA's 30-day timeline appears feasible within these constraints.

In either case, the ILA appears to be flexing its muscles ahead of the 2018 contract negotiations, where issues of automation and retraining, and contracting processes are sure to prevail.