Update, Nov. 5, 11am PST: The Seattle Times has this update of the secret talks (well, not secret any more) between the IAM and Boeing over the site location for the 777X. Boeing wants health care and pension costs cut. These were key issues in the SPEEA contract negotiations (in the end, pensions were shifted from defined benefit to 401(k) for new employees but health care cuts were saved for another day).
When the health care and pension plans came under Boeing attack in the SPEEA negotiations, behind the scenes the IAM was said to be already planning to gear up to hold the line when the current contract expires in 2016.
The Seattle Times report also includes some reaction to the leaked terms.
The news that the International Association of Machinists has been engaged in secret talks to win Boeing’s site selection for the 777X for Everett (WA) carries implications beyond the obvious jobs, economic benefits and Washington vs South Carolina rivalry.
As readers of this column know, we’ve suggested that the Washington Legislature consider making the State a right-to-work state. Understandably, this suggestion hasn’t gone down well with IAM 751, the local here in Puget Sound, with SPEEA, the engineers’ union, or with Gov. Jay Inslee, a Democrat with close ties to the unions.
We have urged this consideration because Boeing has been moving SPEEA jobs out of state and has leveraged South Carolina (a right-to-work state) against Washington.
If the IAM and Boeing reach an agreement to extend the current contract from 2016 to the mid-2020s (we believe 10 years to 2026 seems to make sense), assuring Boeing steady production, many of the issues facing Boeing that enable it to leverage RTW over unionized Washington become moot.
RTW has been a sword wielded by Boeing over the IAM and Washington. It has been a sword of Damocles. The IAM, typically a highly militant union, took an enlightened approach two years ago when it extended a contract in place by four years in exchange for Boeing selecting the Renton (WA) plant for the final assembly line for the 737 MAX. This prospective 777X deal would carry this innovative approach further.
Secondly, we have heard–anecdotally to be sure–that customers are concerned over the prospect of Boeing Charleston being selected because of the history of quality control challenges from this 787 assembly site, preferring the proven history of Everett’s quality control.
Next up, SPEEA is now faced with coming to a peace agreement. After a highly contentious contract negotiation last year, culminating in an odd set of ratification votes early this year, Boeing has systematically moved SPEEA jobs out of state. As the weaker of the two unions, SPEEA needs to use the example of the IAM to tone down the rhetoric. We know conversations are underway. We don’t know what direction they are taking, however. But if SPEEA can follow IAM’s example, aerospace in Washington State will be able to look at the future with more confidence.
The trick will be for Washington politicians to avoid becoming complacent, as it has time and time and time again.