LOS ANGELES—After an 11-month battle and nearly a port shutdown, the West Coast ports have voted in favor of a new labor agreement for dockworkers. The final provisions of the agreement were laid out in February and ratified this week. The new contract is retroactive to July 1, 2014 and runs through June 30, 2019.

“The new labor agreement primarily bolsters health benefits and streamlines the arbitration process for dockworkers,” Kevin Young, procurement research analyst at IBISWorld, tells GlobeSt.com. “Other stipulations of the deal limit the ability of port operators to outsource jobs as well as increases wages and pensions. In regards to port operations, the new agreement is not expected to significantly affect the volume of shipments at West Coast ports in the next five years.”

The agreement was struck between the Pacific Maritime Association and the International Longshore and Warehouse Union, which have been negotiating a new labor agreement since late 2014. The disagreement has led activity away from the ports to alternative locations, like the East Coast and Gulf Coast ports, which experienced a 7% increase in April while the West Coast ports saw a 6% decline.

The new agreement also includes an improved arbitration process to, hopefully, avoid such a lengthy negotiation process in the future. However, there is a cost to this new agreement. According to Young, importers and exports should expect increased fees. “Per new labor stipulations in the agreement, port operators will face additional wage and compliance costs in the three years to 2019,” he says. “They will likely raise shipping prices to compensate, leading to slight increases in transportation costs for importers and exporters.”

This is only the most recent dispute in the ports' history. There were also disagreements over labor contracts in 2002 and 2008 when the contracts came up for renewal. Those resulted in full port shutdowns. Because of the likelihood that we will face another dispute in 2019, when this contract expires, Young says that some importers and exporters may seek alternative shipping routes permanently to avoid future service disruptions.