New Deal Covers Union Workers Through September 2016
In a move that's virtually unheard of in the arena of labor
negotiations, members of the International Association of
Machinists & Aerospace Workers (IAM) in Washington, Oregon and
Kansas have approved a four-year agreement extending their contract
to September 2016 nine months before the current contract was due
to expire. The contract, ratified by 74 percent of those casting
ballots, builds on a new spirit of cooperation between Boeing and
the IAM and places production of the 737 MAX in Renton. It also
continues fabrication work for the Next-Generation 737 and 737 MAX
in other Puget Sound facilities and Portland, OR.
To date, Boeing has received more than 700 commitments from
customers for the 737 MAX. The new airplane is expected to enter
service in 2017.
"This contract will help secure a better future for our employees,
our customers, our communities and our company," said Jim Albaugh,
president and CEO of Commercial Airplanes. "It reflects an effort
on the part of the company and the union to find a better way to
work together and achieve common ground. It's a balanced agreement
that makes us more competitive and ensures that the 737 --the best
single-aisle airplane in the world -- continues to be built by the
people who know how to do it best."
The contract calls for wage and pension increases in each of the
four years of the agreement, along with a one-time ratification
bonus of $5,000, which will be paid on Dec. 15, the last hourly
employee paycheck before the holiday break. It also introduces an
incentive pay plan for hourly employees. The plan tracks
performance on such things as safety, quality and productivity. The
individual scores of teams get rolled up into a single score for
all of the hourly employees, which determines the incentive payout.
Adjustments to health care plans include improvements in key
benefits balanced with modest cost increases that reflect a desire
to make benefits more comprehensive while moving toward a
market-based plan that shares costs between the company and
employees. The agreement also establishes a Joint Council for the
company and union to regularly discuss issues including workforce,
market, competition and performance.
For Boeing, the agreement reflects a new era in relations with
its largest labor union, as the company and the IAM work together
on issues of safety, quality and competitiveness. It also adds
stability as the company continues to ramp up its production rates
across all programs. "Commercial Airplanes has unprecedented
opportunities and challenges ahead as we deliver new airplanes to
our customers, increase production rates and meet a new generation
of competitors," said Albaugh (pictured). "With this vote, we
commit to work together for our mutual success."
“I’m confident we’ve turned an important corner
in the 76-year relationship between Boeing and the IAM,” said
IAM Vice President Rich Michalski. “Both sides are committed
to maintaining the high levels of communications and cooperation
that produced this agreement.”
A series of meetings earlier this year between Michalski and
senior Boeing executives were a prelude to the brief but intense
negotiations over job security, the 737 Max assembly location,
workers’ pensions and a program to allow members to share in
the success of the company.
While resolution of the National Labor Relations Board (NLRB)
case against the Boeing Company was not specifically addressed in
the terms of the new contract, the IAM declared it would consider
the matter settled once the contract was ratified and the new job
security provisions were in place. “I have contacted the NLRB
to advise them of the ratification results and requested they
initiate the appropriate steps to withdraw the complaint without
delay,” said Michalski. “Despite an unprecedented level
of harassment, intimidation and partisan political pressure, the
NLRB and its officers measured up to the highest standard of grace
under pressure. They deserve the thanks and admiration of every
law-abiding American.”