After a high-pressure campaign from pension-holding politicians, Boeing executives, and international union leaders, more than 32,000 rank-and-file union Machinists who work for Boeing in the Puget Sound area, in Gresham, Oregon, and in Wichita, Kansas, narrowly approved an eight-year contract extension that will eliminate their defined benefit pension plan starting in September 2016 — when the current contract expires.
The contract vote held Jan. 3 passed by roughly 600 votes — 51 percent to 49 percent.
It was the second contract Boeing presented to workers in less than two months — both under threat of moving production of its new 777X airliner out of Washington if not ratified. In exchange for keeping the jobs in-state, Boeing demanded that workers give up their traditional pension plan, pay more out-of-pocket for health insurance, and limit future wage growth.
Machinists rejected the first proposal by a 2-to-1 ratio. That vote was held Nov. 13 with a record turnout reported.
The second vote on Jan. 3 drew several thousand fewer voters and passed by a slim margin.
Connie Kelliher, communications director for District Lodge 751 in Everett, Washington, said Boeing was in its annual end-of-the-year holiday shutdown and many workers were on vacation when the announcement was made that a second vote would take place.
“There was about seven to eight thousand members that didn’t vote on it, and it was such a slim margin — 300 votes either way would have changed it,” Kelliher told Workers Independent News. “That means that about 37.5 percent of the members actually got to decide the fate for the next 10 years, which erases 78 years of collective bargaining history.”
Kelliher said “there’s been a huge outcry” from members and union leaders, questioning the timing of the second vote. She said several members have filed complaints with the National Labor Relations Board (NLRB), and petitions calling for a re-vote have been circulated to collect signatures to send to the international union. Rank-and-file workers held a “Re-Vote Rally” Jan. 9 at the Everett Union Hall.
According to documents obtained by the Labor Press, on Dec. 9, Boeing requested to meet with the union to talk about the Nov. 13 election. The sides met on Dec. 10 and again on Dec. 12, which resulted in a new contract proposal with amended terms. On top of a previously offered $10,000 ratification bonus, Boeing added a $5,000 bonus payable in 2020. The company tacked on additional dental benefits of $500 per person ($2,500 maximum) starting in 2020, and another $500 per person ($3,000 maximum) starting in 2024. Boeing also withdrew its demand to slow the wage progression for new hires. The offer reverted to the status quo, which is that new hires reach the top of the pay scale in six years.
“Every other item was exactly the same as the offer you rejected Nov. 13,” Tom Wroblewski, president and directing business representative of District Lodge 751, posted on the union’s website. Wroblewski and Lodge 751’s leadership team refused to present the offer to members, insisting there weren’t enough substantial changes to warrant another vote.
That prompted several Washington politicians — including Gov. Jay Inslee and U.S. Rep. Rick Larsen — to criticize the union for not voting the contract proposal.
On Dec. 20, International Association of Machinists and Aerospace President Thomas Buffenbarger stepped in. He ordered a new vote on the revised proposal and set the election for Jan. 3.
In a Dec. 26 letter to Boeing workers, Buffenbarger said he took the action based on the large number of members who contacted him requesting a vote on the revised offer. Buffenbarger wrote “… the membership deserves the final say … I have requested the voting process be conducted in a manner that enables the fullest participation of the membership.”
Buffenbarger didn’t take a position one way or the other on how to vote, though his letter emphasized that several states had tendered “serious offers and incentive packages to the company,” and “the timeline for the Puget Sound area is expiring.”
“Our international president forced this vote under the guise of he wanted the members to have the final say on it,” Kelliher told Workers Independent News. “Well, if you want the members to have the final say, don’t pick a day where you know 25 to 30 percent of them are not available.”
Wroblewski and the Lodge 751 staff unanimously recommended that members reject the offer, emphasizing that Boeing wasn’t a struggling company.
According to a Los Angeles Times report, Boeing delivered a record 648 planes last year and its shares traded at all-time highs on the New York Stock Exchange.
The eventual vote by union workers to surrender their defined pension plan spurred some media pundits to predict the end-times for all of organized labor. Kelliher disagreed, telling Bloomburg News that workers felt powerless because they were in the middle of a contract and, therefore, didn’t have their biggest weapon — the threat of a strike — to slow Boeing from its demands for concessions.
[Boeing Machinists are working under the terms of a contract that expires in September 2016. That contact was “extended” mid-term in 2011, also under threat of relocating jobs to another state if it wasn’t ratified. The last traditional collective bargaining took place in 2008. If allowed to stand, the newly extended contract won’t expire until September 2024.]
Just days before the Jan. 3 contract vote, Boeing unleashed a full-scale media campaign in support of the contract. Press conferences by politicians pushed Machinists to accept the deal or else bring financial ruin to Puget Sound.
“We faced tremendous pressure from every source imaginable in deciding how to vote,” Wroblewski wrote to members in a post-election letter. “Politicians, the media and others who had no right to get into our business, were aligned against us and did their best to influence your vote.”
Kelliher called Boeing’s actions “corporate extortion that squeezed both the workers and $8.7 billion in tax concessions from Washington state.”
In a three-day special session in November, Washington lawmakers granted Boeing the largest private corporate tax subsidy in the history of the United States.
And despite the portrayal of workers giving up their pensions in return for guaranteed jobs, Kelliher said there is no real iron-clad jobs guarantee in the contract.
“For a two-paragraph language giving us the airplane, the first sentence says we get the work and the next two paragraphs give them loopholes to move it,” she told Workers Independent News.
Wroblewski said the union’s goal in coming years will be to fight to ensure Boeing lives up to its commitment to its workforce and keeps jobs in Washington state.
“Our members have spoken, and this is the course we’ll take,” he said.
(Editor’s Note: Members of Gladstone-based Machinists Lodge 63 rejected the second proposal by roughly the same 2-to-1 margin they did in November, though approximately 200 fewer votes were cast. Lodge 63 represents 1,194 members at the Boeing parts plant in Gresham.
Boeing employs about 82,000 workers in Washington. Last spring its engineers and technical employees — represented by the Society of Professional Engineering Employees in Aerospace (SPEEA) — ratified contracts that ended defined benefit pension plans for new hires. In exchange they will have 401(k) style savings plans. Bargaining of those contracts was contentious, with proposals rejected, threats of a strike, and nearly a dozen unfair labor practice complaints filed by the union.)