Boeing Factory Workers Vote To Reject Latest Contract Offer And Continue Strike

Topline

Boeing’s striking factory workers voted to reject the company’s latest contract offer on Wednesday night and extend their work stoppage—which began six weeks ago—in a major blow to the plane maker, which reported a $6 billion quarterly loss on Wednesday.

Key Facts

The International Association of Machinists and Aerospace Workers (IAM)—the union representing the striking workers—said Boeing’s latest offer was rejected by 64% of its members who voted on it.

Jon Holden, the local president of the IAM union, said in a statement they had made “tremendous gains” in the latest tentative agreement in areas that were important to the workers but added they have not “achieved enough” to meet all their demands.

Holden said the union’s members would “continue to stand on the line, picketing for the contract they deserve…and we will work to get back to the bargaining table.”

According to the Seattle Times, Holden said the negotiators will attempt to push Boeing more on issues it had refused to budge on—including a 40% wage increase, additional vacation and sick leave and the reinstatement of a pension plan.

Boeing has not yet commented on the rejection of the contract by the striking workers.

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Crucial Quote

"This contract struggle began over ten years ago when the company overreached and created a wound that may never heal for many members…We have prepared for years to bring this membership back to a position of power and leverage, and we are there tonight. These negotiations, this strike, today’s vote - it’s a culmination of everything for many people, filled with emotions,” Holden said.

Key Background

Last week, Boeing and the union announced they had reached a tentative deal. The updated offer from the plane maker included a 35% raise over four years and a ratification bonus of $7,000——up from 30% and $6,000 respectively in the company’s last offer. The deal also offered increases to 401k contributions but did not restore the traditional pension plans, a key sticking point for the workers. The recent offer came a week after Boeing withdrew what it said was its last and final which the union had dismissed as a “non-negotiated deal.” The strike began six weeks ago and it has halted most commercial plane production at the company and prompted Boeing to furlough its executives, managers and other white-collar employees one week of every four for the duration of the strike.

Tangent

Earlier on Wednesday, Boeing announced its financial results for the third quarter and reported a more than $6.1 billion loss. While announcing the results, the company’s CEO Kelly Ortberg called for a “fundamental culture change in the company.” He then added: “Our leaders, from me on down, need to be closely integrated with our business and the people who are doing the design and production of our products. We need to be on the factory floors, in the back shops and in our engineering labs.”

Big Number

33,000. The total number of Boeing unionized factory workers from the Pacific Northwest region who are taking part in the strike.

Further Reading

Boeing Reaches Tentative Union Deal—Would End Five-Week Strike (Forbes)

New Boeing CEO sets sights on ‘leaner’ future as quarterly loss tops $6 billion (CNBC)