SEATTLE- Boeing faces mounting pressure as union workers vote decisively to reject the company’s latest contract proposal, extending a strike that has paralyzed production for over a month.
The International Association of Machinists and Aerospace Workers revealed that 64% of its 33,000 members voted against the offer on Wednesday (October 23, 2024), dealing a significant setback to both Boeing and the Biden administration’s mediation efforts.
Boeing Workers Vote, Strike Continues
Union leadership emphasized their determination to recover from a decade of concessions, stating their readiness to return to negotiations immediately.
IAM District 751 President Jon Holden addressed the vote’s significance, tracing the conflict’s origins to company decisions in 2014 that created lasting workforce impacts.
The union’s position strengthened through strategic preparation, despite challenges including the pandemic, Boeing’s safety crises, and escalating inflation.
The proposed agreement contained significant improvements in key areas, yet failed to meet comprehensive member demands. Holden emphasized the unprecedented unity displayed across the workforce, spanning veteran employees and recent hires from diverse backgrounds.
The strike continues as union leadership pursues renewed negotiations. Holden affirmed the membership’s resolve to maintain picket lines until securing appropriate contract terms, stating workers’ voices remain central to ongoing discussions.
The rejected proposal included a 35% wage increase over four years, incentive bonus reinstatement, enhanced 401k matching, and a $7,000 ratification bonus. Workers notably pushed for the restoration of pension benefits, which they surrendered in previous agreements.
A potential strike resolution emerged last weekend through acting US Labor Secretary Julie Su’s mediation efforts. The union’s bargaining committee endorsed presenting the proposal to members on October 19, citing meaningful progress in negotiations.
The latest rejection follows workers’ dismissal of an initial agreement in early September. Federal mediation resumed on October 7 after a two-week deadlock, but Boeing suspended talks and withdrew its 30% wage increase offer shortly after.
Boeing terminated striking workers’ healthcare benefits on October 1, prompting union members to seek temporary employment while receiving $250 weekly strike pay. The company simultaneously announced plans to reduce its commercial unit workforce by 10%, affecting 17,000 employees across union and non-union positions.
$6 Billion Q3 Losses
The Anderson Economic Group estimates the strike’s direct economic impact at $7.6 billion, with Boeing absorbing $4.35 billion in losses and suppliers facing nearly $2 billion in damages.
The strike’s continuation compounds Boeing’s financial troubles, as newly appointed CEO Kelly Ortberg disclosed quarterly (third-quarter) losses reaching nearly $6 billion.
Boeing CEO Kelly Ortberg unveiled a comprehensive transformation strategy to address the company’s prolonged financial downturn. Ortberg, who assumed leadership in August, emphasizes implementing fundamental cultural changes across Boeing’s operations.
The CEO mandates increased management presence on factory floors to identify and resolve issues promptly, addressing root causes of operational challenges. Ortberg prioritizes rebuilding labor relations, acknowledging the disconnect between management and workers during the ongoing strike.
Boeing confronts multiple challenges, including potential bankruptcy, necessitating workforce reductions, and urgent fundraising efforts. The company must also satisfy federal regulators regarding 737 MAX safety improvements while managing continuous losses since 2018.
Workers maintain firm positions on key demands. Larry Best, a Boeing customer-quality coordinator, advocates for pension reinstatement and 40% wage increases over three years. Best identifies the current climate as optimal for securing these improvements, urging continued strike action.
The walkout, which began September 13, continues to impact Boeing’s operations during a period of intense scrutiny over its manufacturing practices and financial performance.
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