The leader of the largest union at Boeing today slammed the company's best-and-final offer on a new labor agreement and urged his members to launch a potentially crippling strike.
The leader of the largest union at Boeing today slammed the company’s best-and-final offer on a new labor agreement and urged his members to launch a potentially crippling strike against the aerospace giant when they vote on the proposal tomorrow.
“We’re recommending our members reject it,” said Mark Blondin, president of International Association of Machinists, District 751, in an interview. “It’s a totally unacceptable contract. Boeing wants to take us on, and we’re up for it.”
The Machinists’ current contract expires just after midnight Friday. If more than 50 percent of the union’s 18,300 members reject the contract and more than two-thirds approve a strike, a walkout could begin as early as Friday.
Alan Mulally, chief executive of Boeing Commercial Airplanes, said the compensation package that resulted from two weeks of round-the-clock talks with the union was the best in the industry, befitting workers who are the “heart and soul” of Boeing.
He warned that a strike would stunt Boeing’s recent progress against Airbus, damage Boeing’s relationships with its customers and harm all Commercial Airplanes employees.
“Our contingency plan is we would go into an orderly shutdown of the Boeing Company” if there is a strike, Mulally said. “That would be devastating for all of us.”
The Machinists have said for weeks their top three contract issues were pensions, health care and job security.
Blondin said Boeing’s proposal, unveiled late Tuesday afternoon, falls short on all fronts, despite the company’s decision to increase the pension offer in the final proposal after refusing to budge in three earlier versions.
“Boeing offered the smallest percentage increase in the 50 years that our pension has been in existence,” Blondin said.
Boeing offered to increase pension payments to $66 per month for each year of service at the company, up 10 percent from $60 under the current contract.
In previous proposals Friday, Sunday and Monday, Boeing had offered to increase pensions to $64 per month.
Mulally encouraged employees to look beyond pensions and keep in mind other ways Boeing is trying to help them save for retirement.
He noted the proposal includes two $3,000 cash bonuses in the first two years of the deal. The total could increase to $9,000 if workers roll the entire amount into Boeing’s Voluntary Investment Plan (VIP), which works much like a 401(k) retirement plan.
“Between that and Social Security and the pensions, you can just about replace your salary when you retire,” Mulally said.
On health care, Blondin said the company was asking Machinists to bear too much of the burden of rising costs.
“They doubled and tripled the monthly premiums, [and] increased co-pays,” Blondin said. Chaz Bickers, a Boeing spokesman, countered that the company has preserved health-care options for workers with widely varying premiums, including one that would have zero premiums if workers receive new “wellness credits” by taking part in health-management programs.
Blondin was especially upset with what he called Boeing’s “failure to partner” with the union on job security.
“There were no improvements on job security,” he said. “Boeing actually came to the table with more takeaways.”
In the 2002 contract, Boeing instituted new language that allows it to select company team leaders based solely on skills and aptitude. The Machinists wanted to insert language that would make seniority part of the criteria, an especially sensitive issue because the average age of union members is over 50. Boeing declined.
Mulally said the current method for choosing team leaders is working well.
“The results have been outstanding,” he said. “Everbody has been pleased with the quality of the people” chosen.
Throughout the past week, Boeing steadily increased the amount of cash available to Machinists if they ratify the contract on the first vote: $3,000 the first year; $3,000 the second year; a potential company match of $3,000 if the bonuses are rolled into the VIP plan; a 5.5 percent wage increase over the life of the contract; and a new incentive plan that could give each worker 5 to 15 days’ additional pay if Boeing hits its annual earnings’ target each year.
“It has money in every year” of the contract, Mulally said. “It’s a nice little balance over the three years. For the first time, we have an incentive plan that has a lot of upside potential.”
Blondin said the cash was a ploy by Boeing to persuade union members to abandon their priorities.
“They offered an economic package of lump sums to try to buy off our membership,” Blondin said. “That won’t work.”
Now it is up to 18,300 workers in the Puget Sound area, Portland and Wichita, Kan. to decide whether to follow Blondin’s advice and walk off the job for the first time since 1995. That strike lasted 69 days.
David Bowermaster: 206-464-2724 or email@example.com