Boeing Machinists Consider New Contract Amid Ongoing Strike

SEATTLE — Unionized factory workers at Boeing voted on Monday to decide whether to accept a contract offer or continue their strike, which has already lasted more than seven weeks, resulting in the halt of production of most Boeing passenger planes.

A ratification of the contract on the eve of Election Day would allow this major U.S. manufacturer and government contractor to resume airplane production. If members of the International Association of Machinists and Aerospace Workers reject Boeing’s offer for the third time, the company would be thrown into more financial trouble and uncertainty.

Boeing's latest contract proposal includes pay raises of 38% over four years, along with bonuses for ratification and productivity. The IAM District 751, representing Boeing workers in the Pacific Northwest, has backed this proposal, which is slightly better than a previous offer that was turned down nearly two weeks ago.

Union representatives noted that they have maximized what they could achieve through negotiations and the strike. They cautioned that if the current proposal is rejected, Boeing's future offers could be less favorable. Results of the vote are expected to be announced late Monday.

Boeing claims that the average annual pay for machinists is currently $75,608, which would rise to $119,309 in four years if the contract is ratified.

A significant issue for workers has been pensions, which were a major reason for rejecting Boeing’s previous offers in September and October. The current proposal still does not offer to restore a pension plan that was frozen nearly 10 years ago.

If the machinists ratify the current contract, they would ideally return to work by November 12, according to the union’s statement.

Workers received their last paychecks in mid-September, shortly after the strike began, leading to increasing financial pressures for many. Bernadeth Jimenez, a quality assurance worker at the Boeing plant in Everett, Washington, expressed her support for the new offer. Having previously voted against the company’s proposals, she stated that she appreciates the increase in wages and does not expect a pension, as she has invested in her 401(k) plan.

“This offer is good, and I’m eager to return to work,” she said. “This time we’re prepared.”

Conversely, Theresa Pound, who has worked at Boeing for 16 years, voted against the contract just as she did for the two earlier offers. She expressed concerns about her future financial stability, stating, “Adding 3% doesn’t change anything for my future. I’m worried that I won’t have a comfortable life when I retire.”

Both Jimenez and Pound have husbands who work at Boeing, and both couples anticipated the strike by working extra hours beforehand. However, they are now facing financial strain.

“We’re getting by the best we can,” Pound mentioned. “While we’re starting to run low on funds, that won’t be my breaking point. I will find other ways to cope.”

The strike began on September 13 when an overwhelming 94.6% of machinists rejected Boeing’s initial offer of a 25% wage increase over four years, which fell short of the union's demand for 40% raises over three years.

The second offer of a 35% wage increase over four years also failed on October 23, the same day Boeing revealed a third-quarter loss exceeding $6 billion. However, this proposal attracted 36% support, a notable increase from just 5% support for the mid-September offer, leading Boeing leaders to believe a deal was within reach.

The rejections stemmed from a growing frustration with concessions and minimal pay increases over the past years.

This new contract proposal includes slightly larger pay hikes, a $12,000 ratification bonus (increased from $7,000), and higher company contributions to employee 401(k) accounts.

Furthermore, Boeing promises that its next airline aircraft will be manufactured in the Seattle area, although union leaders worry this commitment may be rescinded if workers reject the new offer.

The strike has gained attention from the Biden administration, with Acting Labor Secretary Julie Su intervening multiple times, including last week.

This labor dispute marks the first strike by Boeing machinists since an eight-week walkout in 2008, adding to a series of challenges faced by the company this year.

Boeing has been under scrutiny following an incident earlier this year when a door plug detached from a 737 Max aircraft during a flight. Regulatory agencies have enacted limits on Boeing's production until they can assure compliance with safety standards.

Concerns surrounding the 737 Max have been heightened after two crashes in 2018 and 2019 took the lives of 346 individuals. Following the ongoing troubles faced by the company, a previous CEO announced his resignation in March.

Recently, Boeing disclosed plans to lay off about 17,000 workers and raised funds through stock sales to prevent a potential credit downgrade. S&P and Fitch Ratings indicated that the $24.3 billion raised would help manage upcoming debt obligations and lower downgrade risks.

The strike has also created significant cash flow issues, preventing Boeing from getting revenue from aircraft deliveries to airlines. The walkout has halted the production of the 737 Max, Boeing's best-selling model, along with the triple-seven jet and cargo versions of its 767 aircraft.

Boeing's new CEO, Kelly Ortberg, acknowledged that public trust in the company has diminished, noting high debt levels and serious performance issues that disappointed airline customers. However, he emphasized that Boeing still has a substantial backlog of airplane orders valued at around half a trillion dollars.

Koenig reported from Dallas.

Boeing, contract, strike