Boeing Machinists Voting on Contract Tied to 777X

Boeing Washington
Elaine Thompson/APMachinists union members and supporters hold their right hands over their hearts as they recite the Pledge of Allegiance ahead of a rally Thursday in Seattle.
By MIKE BAKER

Boeing machinists will decide Friday whether to accept a contract that would concede some pension and health care benefits in order to secure assembly of the company's new 777X airplane in Washington state.

The offer has fractured the union and drawn unusual pleas from politicians who say the deal is necessary to support the Puget Sound region's economic future. Boeing (BA) has been exploring the prospect of building the 777X elsewhere, a move that could trigger a steady exodus of aerospace jobs from a region where Boeing was founded.

Local union officials, meanwhile, are urging their 30,000 members to oppose the deal, arguing that the proposal surrenders too much at a time of company profitability. They have opposed taking a vote at all but were overruled by national leaders in the Machinists union.

Voting was scheduled for 5 a.m. to 6 p.m. Friday.
Results are expected to be announced later in the night.

A few hundred workers had lined up in front the union hall in Everett, located across from Boeing, Friday morning to obtain ballots. A steady stream of workers walked inside with light blue envelopes in hand.

Washington state has been the most natural place for Chicago-based Boeing to build the 777X, since most of the company's production is still done in the Puget Sound area. Boeing has offered to keep the 777X in the region but sought two big deals: An extension of tax breaks all the way to 2040 and a new contract with the Machinists union that would move workers out of a traditional pension and into a 401(k)-style retirement savings plan.

In November, state lawmakers swiftly approved the tax benefits -- valued at some $9 billion -- but the Machinists rejected a proposed contract shortly afterward. After the initial contract rejection, Boeing immediately began soliciting bids from other states. The company said it received submissions for 54 locations in 22 states.

Boeing has improved its offer since the last vote by machinists. An initial plan to slow the rate that workers move up the pay scale was tossed while the company also offered an additional $5,000 signing bonus and improved dental coverage.

Opponents of the contract oppose the idea of freezing the pension and moving workers to a defined-contribution savings plan. They also decry increased health care expenses and slower wage growth. However, some machinists would likely see their base salaries rise above $100,000 if the deal passes.

Boeing Co. began offering the 777X in May, and company officials have said they need to move swiftly to decide where the plane will be built.

Production of Boeing's 777X would likely bring thousands of well-paying jobs to whatever region wins the work. The plane is a new iteration of its strong-selling 777, and the company recently received orders for 225 new 777X planes from three airlines at the Dubai Airshow.

Boeing has said the 777X is expected to carry as many as 400 passengers and be more fuel efficient than the current 777.

-Associated Press photographer Elaine Thompson contributed to this report from Everett.



Increase your money and finance knowledge from home

Introduction to Value Investing

Are you the next Warren Buffett?

View Course »

Behavioral Finance

Why do investors make the decisions that they do?

View Course »

Add a Comment

*0 / 3000 Character Maximum

6 Comments

Filter by:
ksndra2

Unions can only exist where there is bad management. In right to work states, no one would pay union dues if they did not have to. Closed shop states came in because some people wanted the benefits of a union without paying the dues. As a former steward (collateral duty with my regular work), I never saw nonmembers turn down a benefit won by the union. I was sometimes asked to represent a nonmember who wanted the union's help with a management problem, but did not want to pay dues. Unions are not perfect, but many of the work rights we take for granted came about as the result of union actions.

January 03 2014 at 9:36 AM Report abuse -1 rate up rate down Reply
ricks1951f1

To me it seems a no brainier. Especially if Boeing is entertaining offers from other area's and I have no doubt they are. Take a good look around are there other jobs you can go to, here in LA the answer would be no. Could you make the same or equivalent salary or retirement? Think before you vote Union Reps often have their own interest at heart. It even says in this article the local reps were over ridden just for there to be a vote. Good luck!

January 03 2014 at 8:55 AM Report abuse rate up rate down Reply
vinceautopart

looks like they will be building airplane parts in China also.

January 03 2014 at 8:49 AM Report abuse rate up rate down Reply
mociambz

so once again democrats buy votes with out tax dollars , I hope they move to texas or somewhere they don't have to buy off union thugs to get a job

January 03 2014 at 8:41 AM Report abuse +1 rate up rate down Reply
1 reply to mociambz's comment
mociambz

our tax dollars

January 03 2014 at 8:42 AM Report abuse rate up rate down Reply
c2t2beau

I'm all for high salaries (if) your the only one who can make that screw....

January 03 2014 at 7:55 AM Report abuse -1 rate up rate down Reply
1 reply to c2t2beau's comment
pgile

If only the world was that simple.

January 03 2014 at 8:01 AM Report abuse rate up rate down Reply