The National Retail Federation claims long-running contract negotiations between US west coast dockworkers and their employers are causing port congestion and supply chain chaos.
The previous labour contract between members of the International Longshore and Warehouse Union and employers represented by the Pacific Maritime Association ended on July 1.
But even though the two parties have been locked in talks for months, there has been little indication in recent weeks that a new contract is close to being agreed.
The National Retail Federation claims long-running contract negotiations between US west coast dockworkers and their employers are causing port congestion and supply chain chaos.
The previous labour contract between members of the International Longshore and Warehouse Union and employers represented by the Pacific Maritime Association ended on July 1.
But even though the two parties have been locked in talks for months, there has been little indication in recent weeks that a new contract is close to being agreed.
In a letter to both parties, the NRF commended them for continuing to negotiate but said the failure to reach an agreement “is now having a significant impact on port operations and contributing to port congestion in significant and damaging ways”.
Urging the parties to quickly conclude a new labour agreement, the NRF said this would help resolve the ongoing congestion issues impacting west coast ports. “At a minimum, we ask that the parties extend the expired contract through November in order to reinstate arbitration agreements, which are preventing many issues at the ports from being addressed,” said the letter.
The dispute has affected trade flows to the US for much of the year. Fearing industrial action, many retailers started restocking for the critical holiday season prior to the July 1 deadline while others moved cargo via east coast ports.
But the NRF said that despite the costly contingency plans implemented by retailers in early 2014, recent congestion at west coast ports had “eviscerated” preparations and could cause merchandisers to miss target on-sale dates.
“Retailers are now in the midst of their heaviest shipping season of the year preparing for the upcoming holidays, which are a ‘make it or break it’ time for retailers and merchants,” said the letter.
“Finalizing a new labour contract is an absolutely critical component to working through the backlog of shipping containers now piling up at west coast ports.
“We strongly urge both of your organizations to quickly resolve the remaining issues under negotiation in order to arrive at a new contract as soon as possible.”
And the NRF warned that failure to reach a new agreement soon could have a long-term impact on shipping via west coast ports. “Shippers look for certainty when making strategic long-term supply chain investments, or for placing transportation orders for discretionary cargo,” said the letter. “The ongoing negotiations and the degradation of operating efficiency, specifically at the Ports of Los Angeles and Long Beach, is making the region unattractive for future investment and will lead to a permanent shift of cargo.”
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