Machinists approve four-year extension with Boeing


At the IBEW Local 48 union hall, a machinist at Boeing’s Portland facility votes whether to approve a four-year extension. The extension passed by a three-to-one margin.

In Wichita, Portland, and the Puget Sound, Boeing machinists voted by a 74 percent margin Dec. 7 to approve a four-year extension to their existing union contract. The agreement raises wages and it preserves and increases retiree benefits for 35,000 union members in three states, and it commits to locate some new assembly work at existing union facilities.

The deal was reached after months of high-drama political interference by Congressional Republicans in a federal court case over Boeing’s violation of U.S. labor law. International Association of Machinists and Aerospace Workers (IAM) filed charges March 26, 2011, alleging that Boeing decided to locate its second 787 Dreamliner assembly line in South Carolina in order to retaliate against its union-represented workers for striking. Under U.S. labor law, workers have the right to strike, and employers may not retaliate against workers for exercising that right.

The National Labor Relations Board (NLRB) — in charge of administering that law — investigated, and on April 20, NLRB regional director Rich Ahearn issued a formal complaint against Boeing. Normally, it can be hard to show that retaliation was an employer’s motive for shifting production, but in this case, Boeing’s top executives had said repeatedly that they were locating in South Carolina BECAUSE of past strikes. In the complaint, the NLRB asked the court to order that Boeing locate its second assembly 787 line in the state of Washington. It’s not clear that the judge would have agreed. The two sides were last in court Oct. 20, before administrative law judge Clifford Anderson. But Boeing management may have been concerned about other ramifications of the trial.

Bob Petroff, assistant directing business representative at Gladstone, Oregon, -headquartered IAM District Lodge W24, was one of the five IAM officials who took part in the secret talks over the contract extension. Petroff thinks the NLRB case was a big factor that led Boeing to seek a deal with the union.

“I think they were very fearful of having their CEO testify as to what their intent was,” Petroff told the Labor Press, “because it was not a financially prudent decision. It was based on retaliation.”

Machinists have struck the company four times over the past 20 years. The most recent was an eight-week walkout in 2008, which resulted in the four-year agreement they are currently working under. That pact wasn’t set to expire until September 2012.

After the NLRB targeted Boeing for enforcement, Republicans in Congress targeted the NLRB — threatening its budget, compelling the NLRB’s top prosecutor to testify at a Congressional hearing, even trying to use Congressional subpoena power to get the NLRB to reveal its legal strategy in the Boeing case to the Committee on Oversight and Government Reform.

As part of the accord with Boeing, the union asked the NLRB to drop the case, which it did two days after the ratification vote.

The four-year extension takes the contract through September 2016. Seattle-headquartered IAM District Lodge 751 called the accord “a historic moment” in changing the relationship between the union and Boeing, because for the first time, company executives are committing to keep work in the Puget Sound. Boeing commits in the contract to build a new airplane model — the 737 MAX — at its existing unionized facilities in the Puget Sound.

Other terms:

  • annual 2 percent across-the-board wage increases each September, plus quarterly cost-of-living increases equal to the increase in the Consumer Price Index [IAM says Boeing members currently average $59,000 a year];
  • an incentive program — with details to be worked out by a union-management committee — under which the entire membership would receive a bonus of 2 or 4 percent of annual gross pay if productivity, quality and safety benchmarks are met;
  • a $5,000 signing bonus which Boeing assures will be paid Dec. 15;
  • new cost-sharing provisions starting Jan. 1, 2013, which will require workers to pay a fixed dollar amount of the premium [the monthly amount ranges from $20 to $135 depending on health plan and family size, and the amount goes up 10 percent each year for the life of the contract.
  • improved dental and vision benefits;
  • a new “wellness” program, starting Jan. 1, 2013, in which workers fill out an online questionnaire — or else pay an additional $20 to $40 a month toward the health insurance premium [a joint union-management committee will determine what questions are acceptable];
  • continuation of traditional “defined benefit” pension plan for all members, including new hires, [The promised monthly pension benefit will increase by $2 each year of the contract, such that in 2016, the pension will guarantee a monthly retirement benefit of $91 per year of service.];
  • continuation of retiree medical coverage.

The negotiations took place at the Machinists District Lodge 751 union hall in Seattle. Taking part on the IAM side were general vice president Rich Michalski; aerospace coordinator Mark Blondin; District Lodge 751 (Puget Sound) president Tom Wroblewski; Petroff for District Lodge W24 (Portland); and District Lodge 70 (Wichita) president Steve Rooney. The negotiations were conducted in strict confidence to avoid media and political interference from the outside, a statement from the IAM bargaining team explained.

Boeing reported $1.1 billion in profit for the most recent quarter, and has a $332 billion backlog in orders. The company is currently hiring for union-represented positions in Portland and other locations, and expects to continue to add employees in 2012.


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