Boeing faces the possibility of a strike by 33,000 employees after a union vote on a tentative contract agreement. The contract includes a pay increase of at least 25% over four years, but workers are upset over past concessions they made regarding pension plans and health insurance. The union previously agreed to these concessions when Boeing was reporting strong profits to prevent the shifting of jobs to non-union plants.
Worker anger has been fueled by a series of problems faced by Boeing in recent years, including fatal crashes, a grounding of their best-selling jet, and criminal charges for deceiving regulators. The company has been running at a loss since 2018, accumulating over $33 billion in core operating losses, which has led to a decrease in their credit rating. The strike could have a significant impact on Boeing’s cash flow and delivery delays for airlines.
The contract agreement between Boeing and the International Association of Machinists is described as the most lucrative reached with the union. Boeing’s CEO has promised to “reset their relationship” with the union, while the IAM local president predicts that members will reject the deal and vote to strike. Voting to ratify the deal will take place until 6 p.m. PT on Thursday, with the strike scheduled to begin at 11:59 p.m. PT.
Union members will cast two separate votes, one to ratify the deal and another to authorize a strike. The deal will be approved if more than 50% of members vote in favor, preventing a strike. However, a strike will only occur if at least two-thirds of members vote to authorize it. Unusual union rules mean that even if a majority votes against the contract, there may not be a strike if not enough members authorize it.
The tentative contract agreement includes raises of at least 25% over four years, cost-of-living adjustments, reduced healthcare costs, and improved retirement contributions. Additionally, Boeing has promised that the next commercial jet will be built at a unionized factory in Washington state. The threat of moving production to non-union plants had been a concern, with Boeing having built its first non-union plant in 2009 and shifting some production away from unionized plants in Washington.
The outcome of the union vote will greatly depend on the depth of anger among rank-and-file workers, as well as the voting rules that necessitate separate votes to ratify the deal and authorize a strike. The last time a split vote occurred at Boeing, the deal was ratified despite the majority voting against it. The union leadership recommends accepting the deal to avoid a strike, but the decision ultimately lies with the members.
