The Breakdown

Explaining Southern California's economy

Dockworkers and shipping companies reach tentative deal on health care

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Negotiators of a labor contract covering 20,000 dockworkers at West Coast ports have made progress on a key issue: health care.

Late Tuesday, the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) announced they'd reached a tentative agreement on terms for health benefits. A joint statement announcing the agreement said it's contingent on agreement on the other issues still being negotiated. Both sides also said they'd agreed not to discuss the terms of the tentative agreement publicly. 

West Coast dockworkers, including 10,000 at the Ports of Los Angeles and Long Beach have been working without a contract since the last one expired on July 1st.  Both sides vowed to keep negotiating, and neither has raised the possibility of a strike or lock-out.

The mere possibility of a work stoppage at the 29 West Coast ports the contract covers made retailers and other port watchers nervous.  In June, the Ports of Los Angeles and Long Beach saw increases in cargo volumes, but many attributed the increase to anxiety and preparation as the contract's expiration neared. 

A tentative agreement on health benefits has the editorial staff at Supply Chain Digest cautiously optimistic.   

"Since healthcare was viewed by many as the most challenging issue in the negotiations, this would seem to auger well for a full agreement  before too long," the staff writes in a blog post. But it acknowledges that little is really known about the status of negotiations and that "some shippers and importers are concerned that eight weeks without a deal may mean the issues are serious enough that a strike may yet be a real possibility."


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