PORTS Act aims to grant state governors access to Taft Hartley in event of future port labor issues

As West Coast ports get back to a sense of normalcy on the heels of a nine-month labor disruption that that had a major impact of port throughput and operations, the inbound supply chain, and the economy, new legislation introduced this week aims to ensure that the situation that led to that predicament does not happen again in the future.

The legislation, entitled the Protecting Orderly and Responsible Transit of Shipments (PORTS) Act, was introduced by Senators Cory Gardner (R-CO) and co-sponsored by Lamar Alexander (R-TN), with the objective to “safeguard the American economy from the threat of labor shutdowns and slowdowns at seaports.”

As for how the legislation would achieve this, the Senators said that it would expand the Taft-Hartley Act, a federal law that restricts the activities and power of labor unions, with the Ports Act, in turn, discouraging disruptions at U.S. ports and incentivize quick resolution of disputes.

That would be done by granting state governors Taft Hartley powers that only the President can typically use and includes the ability to convene a board of inquiry and start the Taft Hartley process whenever a port labor dispute is causing economic harm. And when that board reports, the legislation states that governors could petition federal courts to enjoin slowdowns, strikes, or lockouts at ports in their states, with the PORTS Act also including port slowdowns as a “trigger” for Taft Hartley powers.

“This year’s slowdown at West Coast ports demonstrated the disastrous consequences that labor disputes at our ports can have on businesses, consumers, and the entire economy,” Gardner said in a statement. “Labor union bosses should not be allowed to hold the economy hostage, nor should they be allowed to use the livelihoods and jobs of millions of Americans as bargaining chips. This Act would empower local leaders, who are most affected by these port disruptions, to apply pressure to their state governments to bring these damaging disputes to an end.”

A letter to Senator Gardner from several shipper groups voiced their collective support for the bill, citing how the West Coast port labor dispute and negotiations had a significant and costly effect on the U.S. economy, with companies still dealing with the impacts to their businesses across various sectors. Some of the challenges they highlighted included retailers having long delays getting goods to store shelves, manufacturers slowing and even stopping production lines due to unavailable components delayed at ports, and all segments of agriculture missing shipments to global markets and potentially closing those markets to future sales, among others.

The shipper groups stated that while the West Coast ports have finally cleared through the backlog created by the congestion and slowdowns during the negotiations, the economic damage has been done and served as a major driver to low first quarter GDP output.

National Retail Federation Senior Vice President for Government Relations David French endorsed the PORTS Act.

“The nation’s ports and the cargo that flows through them are the lifeblood of our economy said French. “Our ports need to function and operate before, during and after any port labor contract negotiation, and this bill would make it easier to be sure that remains the case. The supply chain needs predictability to work and should remain free from any man-made disasters — be it delays, disruptions, slowdowns, shutdown or strikes.”

The West Coast port labor dispute stemmed from contractual issues between the Pacific Maritime Association and the International Longshore & Warehouse Union (ILWU) that represents 20,000 port employees at 29 West Coast ports. As previously reported, the two parties, and, by extension, many supply chain stakeholders dealt with many stops and starts and acrimonious negotiations until the parties recently agreed to a new five-year deal that runs into 2019. The impasse between the parties goes back to July 2014, when their existing contract expired. Among the issues that led to a tense negotiating environment between the pair were differences on several issues, including wages, pensions, health-care benefits, arbitration process rules and operations.

These differences led to nine months of labor unrest and uncertainty that impacted freight flows and port operations in the form of terminal congestion and related supply chain challenges until PMA and ILWU reached their tentative agreement. During this time, emotions on each side ran high, and when prospects of a new deal were at its bleakest point, the sides turned to the U.S. Federal Mediation and Conciliation Service in hopes of helping the sides find a way to come to an agreement.