Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
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- Pontifications: Boeing “transparency”–not so much. April 9, 2024
- Airbus charges and write-offs since 1999: more than €33bn April 8, 2024
Negotiating in the Media
Certain Members of Congress close to Boeing, and the Governor, told the Seattle papers Boeing essentially issued an ultimatum to the IAM: adopt a no-strike clause or we’ll set up 787 Line 2 in another state.
As you might expect, not only did the message not go down well, neither did the choice of messengers. The IAM issued this response late Wednesday (July 8):
Labor News
FOR IMMEDIATE RELEASE: July 8, 2009
Letter below from IAM District 751 President Tom Wroblewski to members:
July 8, 2009
Dear Brothers and Sisters,
Many of you have seen the story in The Seattle Times where elected officials say they’ve been told by Boeing leadership that the company requires a no-strike clause from us as a condition for keeping a second 787 final assembly here in Western Washington.
I want you to know that:
1) Boeing has not approached us with any formal proposal on this;
2) We’re open to talking about anything that will bring more jobs for our membership, and if Boeing has proposals that would ensure we’ll be building Boeing airplanes here in Puget Sound for generations to come, we’ll certainly listen;
3) Today, we have a four-year agreement in place – one that members ratified and agreed to live by and the Company agreed to abide by, as well.
4) And this is most important of all, your Union leadership will never take such a step without consulting you. We are and always have been a democratic organization.
We are working to improve our relationship with Boeing, and the Machinists Union has made several overtures to that effect. Improving the relationship to bring about a different result in bargaining is a priority. We plan to dedicate a lot of time and resources to this effort.
To use politicians as microphones to deliver a message, creates problems and does nothing to improve the relationship. The two sides need to work without the outside influence of politicians, analysts and reporters. Many of Boeing’s problems with their employees have escalated because of this type of tactic.
Rather than re-create the labor laws that give workers the right to withhold their labor, we should all be working together to improve the relationship.
Several members have also asked questions on management Q&A’s regarding the Boeing/Vought deal – specifically on the answer that mentioned Boeing had negotiated several agreements with the IAM this year. The following are recent agreements we have made to help Boeing be more successful:
• Allowing partners (vendors) to come into the factories here in Puget Sound to perform warranty work in an effort to expedite first flight of 787 and correct many of the challenges facing that airplane.
• Allowed Boeing to bring in employees from St. Louis and Wichita to help on the 787, as long as they were still hiring employees here.
• Agreed to extended temporary promotions of Grade 3 to Grade 4, which mitigated WARN notices.
In addition, to assist members who are facing layoff, we signed a letter of understanding, which allows laid-off or terminated employees the option of continuing to make payments on their VIP loans after leaving the payroll.
Again, we have a 4-year agreement in place, and we are willing to listen to any proposals by the Company on any topic. To date, no proposals have been made by the Boeing Company. We believe everyone should remain focused on getting the 787 certified, which is critical to the future of all of us.
In Solidarity,
Tom
###
While not a huge “corporate” union fan, it is quite obvious that Boeing wants to “bust” the union in Seattle. The question is, how easy is it to achieve, when the method used is to move everything to a new location? Human nature being what it is, the employees in the new location will increasingly demand more and more, until the company will once again decide that it needs to lift anchor and move on again. Not the quickest, easiest or cheapest option. Ultimately I find neither side in this issue to be reasonable.
It’s really easy as far as I read the situation… The 57 day strike devastated both Boeing’s commitment schedule and credibility. They can not compete effectively under the threat of strikes every several years. If the IAM can not sign a long term no-strike pledge then, Boeing has no other choice but to set up a second 787 factory in South Carolina.
It’s really that simple.
Mabe the news below will settle the case much faster than threats & pressure from Boeing ever could do:
** Airbus leads Boeing vastly on Orders **
(Reuters, July 8th 2009)
Airbus has sold a net 68 planes this year vs Boeing’s 1.
Airbus sold 58 aircraft in June, the planemaker said on Wednesday. The larger-than-expected haul brought to 90 the number of planes Airbus has sold this year before cancellations.
Boeing sold 85 aircraft between January and June but airlines cancelled orders for 84 aircraft, leaving it with a positive first-half net order balance of only one aircraft.
Airbus delivered 49 planes including 38 single-aisle aircraft in June, bringing total first-half deliveries to 254 aircraft.
Boeing delivered 246 aircraft in the first half.
My advice to the Boeing people:
Do something, but do it right ! ! !
The traditional way to get a “no-strike” rule on unions is to put contract negotiations into some form of binding arbitration. Is Boeing willing to go that route, or do they just want to engage in pointless union busting? Because as much as they want to beat up the union with a second line, they still have to worry about their first line and a huge backlog of 737s that the IAM can screw with in the next couple of years. This isn’t the time to be picking fights. You really have to wonder about management over there.
Lest I forget:
Airbus/EADS have a strong commitment to
labor peace. If there arises a problem between
the company and its labor force, it will be
negotiated between the parties until a mutual agreement is found.
Binding interest arbitration might be a solution that meets the interests of both management and labor.
However, it’s rather silly to blame the problems of Boeing on the IAM. Poor labor relations are a symptom of a dysfunctional labor/management relationship not the cause.
What’s happening within Boeing corporate is a cultural shift. Employees are viewed by corporate as interchangeable parts of the corporate enterprise (like janitorial services vendors). Employees used to be valued for the intellectual capital they injected into the design and production process.
This shift in how corporate treats its employees has had a list of entirely predictable outcomes including production, communication, coordination and morale problems.