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Boeing and its machinists’ union have agreed on a new negotiated offer to raise worker pay and potentially end a crippling strike that began seven weeks ago with a vote on the new proposal set for Monday.
Employees were urged to approve the contract by the union. Getting workers back into factories is urgent for Boeing as it faces mounting losses.
The International Association of Machinists and Aerospace Workers District 751 stated on Thursday that “there is a point in every negotiation and strike where we have extracted everything that we can in bargaining and by withholding our labour.” “We risk a regressive or lower offer in the future because we are at that point right now.”
Compared to a previous offer of 35%, the new proposal includes 38% general wage increases over four years, bringing the compounding pay increases to nearly 44%, the union said Thursday. Additionally, employees can choose to accept a prior offer of a $7,000 ratification bonus and a $5,000 401(k) contribution, or they can choose to receive a $12,000 one-time ratification bonus.
Asking its members to continue their strike “would not be right, as we have achieved so much success,” the union claims.
Boeing’s more than 32,000 machinists, mostly based in the Seattle area, walked off the job on Sept. 13 after turning down a tentative agreement. They rejected a second proposal earlier this month that would have extended the strike.
The average pay for machinists at the end of the contract will be $119,309, Boeing said Thursday.
“It is time we all come back together and focus on rebuilding the business and delivering the world’s best aeroplanes,” said Kelly Ortberg, the CEO of Boeing, in a letter to staff members on Friday. “A lot of people depend on us.”
Because “the outcome of the vote will impact all of us,” he urged staff members to vote.
The Biden administration has interfered in negotiations during the strike, which has halted most of Boeing’s aircraft production, a significant U.S. exporter. Julie Su, the acting labour secretary, met with the company and the union this week.
The Boeing strike took a bite out of U.S. employment numbers in October, according to Friday’s U.S. jobs report, the last before the Nov. 5 presidential election.
President Joe Biden congratulated the union and Boeing for the new contract proposal.
He said in a statement on Friday, shortly after the jobs report was released, “Boeing mechanics have made sacrifices over the years and deserve a strong contract.”
Ortberg said on his first earnings call last week since taking the top job in August that the company has been “feverishly working to find a solution that works for the company and meets our employees’ needs.” Hours later, the workers rejected a negotiated proposal.
Boeing machinists have repeatedly pushed for higher compensation as the cost of living in the Seattle area—where technology giants like Microsoft and Amazon have ramped up staffing—has surged in recent years.
As in earlier iterations, Boeing committed to building its next aircraft in the Puget Sound region under the terms of the new contract proposal. The fact that Boeing relocated the production of the 787 Dreamliner to a non-union plant in South Carolina is one issue that the workers are upset about.
Boeing executives’ plans to stabilise the aerospace giant, which is still reeling from production flaws and the fallout from safety issues, including a door plug that blew out midair from a Boeing 737 Max 9 at the beginning of the year, have been further delayed by the strike.
Boeing warned that it would continue to lose money through 2025 after suffering a loss of over $6 billion in the most recent quarter.