The Machinists union has negotiated an unusual mid-contract pay raise for about 16,000 of its members at Boeing, winning a $4 per hour increase of minimum pay rates. The agreement comes after Boeing, facing a worker shortage in the region's tight labor market, raised pay rates for new hires.
Boeing’s Machinists union has negotiated an unusual mid-contract pay raise for thousands of its members, winning a $4-per-hour increase of minimum pay rates.
The Machinists’ current contract, ratified five years ago, set pay rates through 2024. However, last year, after years of layoffs and attrition, management responded to an acute labor shortage in some areas by offering new hires wages that were higher than stipulated in the contract.
That meant some new hires were earning more than their colleagues in the same job, so the union successfully argued that management needed to fix the disparity by raising minimum pay rates in the contract.
In a bulletin issued to its members, the International Association of Machinists (IAM), District 751, explained that the union has the legal right to demand to negotiate over the impact whenever management unilaterally changes “working conditions or company policies.”
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“When an employer changes our working conditions, we have choices to make to protect our members,” the bulletin said. “You all understand the morale issue this caused in the shop.”
For Boeing, the agreement will make it easier to hire people in the region’s tight labor market, where minimum-wage laws in cities including Seattle mean even many fast-food franchises are offering starting wages of $15 per hour.
In a statement, the company said it is committed to offering competitive pay.
“We want to ensure we are compensating employees for their valuable work and enhancing our ability to attract, retain, and engage employees,” Boeing said.
District 751 president Jon Holden said about 16,000 Machinists, more than half of his members, will get a pay raise as a result.
Those who are higher up the pay scale for their grade will not. The union said that, prior to this agreement, average pay for all IAM-represented workers was $35.06 an hour – or nearly $73,000 a year before overtime.
“It’s a substantial increase for our folks, but some aren’t receiving anything,” Holden said. “It’s positive when we get anything. But there was leverage only to address the lower wage rates.”
The agreement provides a $4-per-hour increase to the minimum pay rate for all grades of mechanics, retroactive to Jan. 1. That means most newly hired mechanics will start at $19 per hour.
The deal separately sets a minimum wage of $15 per hour for janitors who clean company facilities. And it offers small bumps in hourly rates for promotions and for working late shifts.
To avoid similar pay disparities emerging again in future, Boeing also agreed to review the pay of previous hires when it offers higher rates to new hires “to ensure their current pay rate aligns with equivalent experience factors.”
Management agreed to make such pay adjustments retroactive to the date at which it starts to bring in new employees at the higher rates.
The wage-increase agreement was first reported Monday by Leeham.net, the Bainbridge Island-based aviation consulting and news service.