A recent protest by truckers over the California gig labor laws have stopped the flow of trade at the Port of Oakland, California. The ongoing protest, which began Monday, has prompted shippers to change ports and reroute to avoid protracted delays—many ecommerce businesses are affected, including one of EcomCrew’s own brands.
Strikers Are Protesting CA’s Gig Labor Law
The protest is over the California Assembly Bill 5 (AB5) or the gig worker law, which essentially requires companies who hire independent contractors to classify such workers as employees. While the bill is aimed at making gig workers entitled to minimum wage and other employee benefits, the truckers fear a potential loss of flexibility, as being independent contractors means they can choose when to work and when not to.
Strikers say the bill will negatively affect around 70,000 truckers, who account for two-thirds of all port truckers in California. The California Trucking Association (CTA) cites potentially severe negative impacts on the trucking sector, including a possible exodus of trucking firms from California, which could make the already strained supply chain situation worse.
Earlier this year, a similar trucker protest in Canada over cross-border vaccine requirements disrupted major trade routes between Canada and the US.
Ecommerce Supply Chains Are Affected
Most ecommerce sellers import from China, and many shipments come into the US via the Port of Oakland and neighboring ports.
Many import containers have sat in the port for more than two weeks, and the number of shipments waiting to get into port at anchor has tripled, according to port personnel. Some shipping companies have also begun to skip Oakland and began rerouting to other ports in the USA, necessitating costs and delays for ecommerce shipments.
One of Our Brands Took a Hit
EcomCrew’s baby brand is among the ecommerce businesses affected—one of our incoming shipments from China bound for the Port of Oakland has been delayed, while a few others are still in-transit and could face potential delay if the protest continues. The delayed shipment includes our brand’s best selling products, of which we’ve had little stock since mid-May. Our freight forwarder failed to pre-pull the shipment because terminals were shut down, while our partner 3PL mentions things have gone crazy because of the protest.
Amazon Global Logistics is equally affected. In an email, AGL informs sellers of potential delays for shipments into US West Coast Ports and has rerouted shipments to mitigate the impact of the ongoing labor negotiations.
Stay tuned for our next Monthly Brand Report where we break down this challenge further.
Resolved for Now…
As of July 25, the protest has since been transferred to a “Free Speech Zone” to alleviate the cost and delays caused by the blockade, and a working group has been convened where port officials promise to liaison with California Governor Gavin Newsom with the aim of a full resolution to the matter. Despite being threatened with arrests, truckers and freight companies say they will “all come back” to blockade again if they don't come up with an acceptable resolution.