East Coast port shutdown looms as talks collapse

Home Textiles Today Staff -- Home Textiles Today, 12/21/2012 11:12:01 AM

Newark, N.J. - Contract talks between East Coast port operators and unionized dockworkers collapsed this week, a move that could lead to the shutdown of 14 ports on Dec. 30.

Each side blamed the other for the breakdown in negotiations, and no new talks have been scheduled. The International Longshoreman's Assn. contract with the United States Maritime Alliance (USMX) expires at midnight Dec. 29, and the union has approved a strike if a new contract agreement isn't in place.

The strike would involve dockworkers at East Coast and Gulf Coast ports, and could create major headaches for furniture importers who are trying to build up inventories in advance of the Chinese New Year, which begins Feb. 10.

The original contract expired in late September, but the two sides agreed to a three-month extension while they continued to negotiate with the help of a federal mediator.

A major issue appears to be supplemental wage payments known as container royalties. The USMX wants to eliminate the payments for new employees and phase them out for current employees over a 25-year period. The union, however, says container royalties are "untouchable."