Another potential supply chain disruption has been averted as the promotional products industry prepares for the holiday season – its busiest time of the year.

The International Longshore and Warehouse Union (ILWU), which represents more than 22,000 longshore workers at 29 ports across the West Coast, has announced that 75% of its members have voted to ratify a hotly contested, six-year contract agreement with the Pacific Maritime Association (PMA), which represents port operators.

“The negotiations for this contract were protracted and challenging,” says ILWU International President Willie Adams. “I’m grateful to our rank and file for their strength, to our Negotiating Committee for their vision and tenacity, and to those that supported giving the ILWU and PMA the space that we needed to get to this result.”

The contract, which was tentatively agreed upon in June, became retroactive on July 1, 2022, and will expire on July 1, 2028, according to the PMA.

“This contract provides an important framework for the hard work ahead to overcome new competitive challenges and to continue to position the West Coast ports as destinations of choice for shippers worldwide,” says Jim McKenna, president and CEO of the PMA. “From San Diego to Bellingham, these ports have long been the primary gateways for cargo coming into and leaving the United States, and our interests are aligned in ensuring they can effectively, and efficiently, handle the capacity growth that drives economies and jobs.”

Worst Case Scenarios Had Looked Possible

As PPAI Media previously reported, the tensions and labor disruptions had reached a point of concern between West Coast port workers and their employers over the negotiations for a new labor contract.

  • The U.S. Chamber of Commerce sent an official letter to President Biden urging the White House to appoint an independent mediator.
  • Likewise, PPAI joined with the National Retail Federation and 236 state, local and national trade associations in a letter to President Biden encouraging the administration to provide both the ILWU and the PMA any and all support to end the negotiations and reach an agreement quickly to ensure no disruptions in port operations and cargo traffic.

Negotiations between the dockworkers’ union and their employers had been ongoing since May 2022, with some 22,000 workers at 29 West Coast ports technically working without a contract for over 11 months.

This led to work stoppages or slowdowns in a number of ports up and down the West Coast.

  • The Port of Oakland completely shut down in early June.
  • Terminals in Long Beach remained closed for multiple days.
  • All of this led to what was being referred to as “slow and go” conditions at the West Coast ports with more than $5.2 billion of cargo having been stuck in truck and container bottlenecks.

Striking A Deal

Despite the various letters to President Biden, it was acting Labor Secretary Julie Su who reportedly played a “key” role in helping both sides come to an agreement. Su said the deal delivered “important stability for workers, for employers and for our country’s supply chain.”

President Biden used the opportunity to praise the effectiveness of collective bargaining, even when it can lead to “acrimonious” negotiations.

“As I have always said, collective bargaining works,” Biden says. “Above all I congratulate the port workers, who have served heroically through the pandemic and the countless challenges it brought and will finally get the pay, benefits and quality of life they deserve.”

  • Details and specifics of the contract haven’t been disclosed at this time.

Promo Perspective

The contract was high stakes for many in the promo industry.

For example, although alphabroderpromo’s third leading supplier in this year’s PPAI 100 – doesn’t ship volume through the West Coast, the Pennsylvania-based company still operates with the understanding that a pivot to the West Coast could be necessary at any point.

According to Cheron Coleman, vice president of private brand product development and global supply chain at the supplier, who had been keeping a close eye on the labor negotiations, assurance that such a pivot is possible without enormous risk is an important part of operations.

“The West Coast ports contract agreement between the ILU and PMA finally brings peace of mind to the entire import community,” Coleman said. “Being a significant first point of entry into the U.S. market, it’s great to hear that, after more than a year of negotiations and work disruptions, the West Coast ports will soon return to some sort of normalcy.”