New York
CNN
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Striking members of the International Longshoremen’s Association will return to work at the ports on Friday, the union announced Thursday evening, after the union and the management group representing shipping companies, terminal operators and port authorities reached a tentative agreement on wages.

The agreement on wages amounts to an increase of four dollars an hour for each year of the six-year contract, a source with knowledge of the negotiations told CNN.

The union agreed to renew the contract it had with the United States Maritime Alliance, the management group known as USMX that represents shipping lines, terminal operators and port authorities. That deal, which expired at the end of Monday, has now been extended until January 15 and will allow union members to return to work while the final details are worked out in a full agreement and ratified by the grassroots. .

The union’s 50,000 members who work at ports from Maine to Texas have been on strike since early Tuesday morning, halting the flow of most containerized imports into the United States, along with much of its exports has come, disrupting American companies’ sales abroad. .

A preliminary agreement would still need to be ratified by ILA regular members before it would come into effect. But because ships stuck at sea can’t get to U.S. ports to unload and load goods, the union agreed to let workers return to work on Friday.

However, if members vote against the agreement, the strike could start again. And such a rejection of a provisional employment contract is not unheard of.

Just last month, the International Association of Machinists (IAM) and aircraft manufacturer Boeing reached a tentative agreement that union leaders recommended their 33,000 members accept and even described as the best deal they had ever negotiated with the company. But union members voted almost unanimously to reject the proposal and have remained on strike since September 13.

The port strike was still in its infancy, but would have had major consequences for the American economy the longer it had lasted.

Business groups have called on the Biden administration to put strikers back to work. The work stoppage threatened the supply of everything from bananas to liquor to European luxury cars, all with the busy holiday shopping season less than two months away. And those shortages could have led to upward pressure on prices.

But President Joe Biden had declined to use the powers he has under the Taft-Hartley Act to block or end the strike, saying he would not interfere with the collective bargaining process. Biden, Vice President Kamala Harris and Secretary of Transportation Pete Buttigieg had all called on the USMX to strike a deal with the ILA that would see record profits distributed fairly among members.

Shipping costs soared during and immediately after the pandemic, as supply chains contracted and demand soared. According to analyst John McCown, the industry’s profits exceeded $400 billion during 2020-2023, which is expected to be more than the industry had previously made in total since containerization began in 1957.

The USMX said Monday it had offered workers a nearly 50% pay increase over the six-year term of the contract, representing an average increase of $3 per hour per year on top of the current top hourly wage of $39. According to ILA President Harold Daggett, the union demanded five dollars per hour per year. That would have increased hourly wages by about 77% over the life of the deal.

Daggett said shortly after the strike began Tuesday morning that the union was willing to consider a recommendation from the Biden administration that both parties agree to a $4 hourly wage increase., but that when USMX had proposed the $3 increase, the union had gone back to the $5 per hour demand.

This story has been updated with additional context and developments.