Port of Los Angeles

Delegates from the International Longshore and Warehouse Union convened today to consider beginning talks early on extending the current labor contract.

The meeting is seen as an important move in ensuring stability at the West Coast ports following the congestion and cargo diversions that erupted in late 2014 and continued on into the following year. The dispute arose after the dockworkers union and Pacific Maritime Association, which represents shippers, were unable to come to an agreement on a new contract after the previous one’s expiration in June 2014. Shippers and dockworkers eventually agreed on terms of a new contract in February 2015 that’s good through July 1, 2019.

The meeting that began today and is expected to run through Friday could push that expiration date further out thus giving companies a greater sense of security. The port slowdown that occurred between late 2014 and early 2015 wreaked havoc on companies’ supply chains causing many to rack up losses in the process. It took months, even after both sides agreed on a contract last year, to finally clear the backlog of containers at the ports.

A number of industry groups representing retailers, distributors, agriculture, importers, exporters and others sent a letter on Monday to Pacific Maritime Association chair and chief executive officer James McKenna and ILWU president Robert McEllrath urging early discussions on extending the contract. Among those who signed off on the letter, a follow-up to one sent in March, was the National Retail Federation and California Retailers Association.

“We strongly believe a contract extension is critical to ensure stability and predictability at West Coast ports,” Monday’s letter said. “You have both recognized the negative economic impact of disruptions and slowdowns that occurred during the last negotiations. We believe starting negotiations early will help avoid a repeat of that experience.”