IAM 751’s president issues message to members: here’s why you can’t vote

Update, 11 am PST: Boeing’s Doug Alder just sent us this statement:

The union leadership rejected Boeing’s best and final counterproposal. Boeing did not withdraw its counterproposal, nor was there any need to do so, because the counterproposal was rejected.

Original Post:

Reprinted here without comment:

Dear Brothers and Sisters:

Several hundred of our 30,000 members at Boeing e-mailed me overnight to ask why you can’t vote on the company’s most-recent contract offer. The answer is simple:

There is no offer to vote.

Boeing’s offer was only on the table Thursday so long as I agreed to recommend the offer and urge you to vote yes on it. But I could not recommend you accept this offer. When I said we couldn’t do that, Boeing withdrew the offer immediately.

So there is no offer to vote.

As union leaders, we couldn’t go onto the shop floor to ask you to accept this proposal. Despite what Boeing is saying, the offer was almost identical to the one you rejected by a 2-to-1 margin on Nov. 13.

In the four-page document they passed to us Thursday afternoon, we could only identify four changes from the Nov. 13 offer, and they weren’t significant:

Boeing sweetened the pot with an additional $5,000 lump-sum bonus – payable in 2020. It is not a $15,000 bonus now, it is still a $10,000 bonus now.

Boeing increased annual maximum dental coverage – by $500 per person in 2020, and by another $500 per person in 2024.

Boeing promised to extend the Letter of Understanding that guarantees we will keep doing 737 MAX work until 2024 – but passed no contract language on it, leaving us uncertain of how solid that guarantee was.

Boeing agreed to back down from its plan to keep new hires in progression for up to 22 years, and to go back to the current system that gets new hires to the maximum rate in six years.Their proposal also called for a “joint evaluation” of the progression system.

Every other item was EXACTLY THE SAME as the offer you rejected Nov. 13.

I think you’ll agree these were very minor changes, and not nearly enough to offset the things Boeing was trying to take away from you, and for the Machinists who will join us in the future:

Freezing your pensions, eliminating them for new Machinists and replacing them with a “savings plan” so vague we couldn’t tell you anything about how it would work.

Raising everyone’s health care contributions by as much as $4,000 a year over 2011 levels by the end of the contract.

Limiting future wage increases to 1 percent every other year, and locking in current starting pay rates until 2024, when thousands of Boeing jobs would be below minimum wage.

Given that you had voted so overwhelmingly against an almost identical proposal on Nov. 13, I didn’t see any point in bringing it to you for a vote, and our Business Reps agreed with me.

So, until Boeing changes its conditions, we don’t have an offer to vote on.

I’m sorry that there has been confusion over this issue, especially by the reported comments of the retired leader from our International headquarters, who seems to be suggesting there’s still an offer hiding out there somewhere, just waiting for you to vote on. I understand that many of you are frustrated, and I don’t blame you.

I simply ask that you work together with me as we continue to make the case that Boeing’s best chance for success – by far – is to build the 777X here in Washington state, utilizing the skills, experience and dedication of the finest aerospace workers in the world: the Machinists of District 751.

In solidarity

Tom Wroblewski

52 Comments on “IAM 751’s president issues message to members: here’s why you can’t vote

  1. This is utter incompetence on behalf of Boeing management. Why tender a proposal that you know the other side cannot agree to? That only serves to inflame the situation.

    If they try to build the 777X elsewhere, it’s going to be another 787 disaster.

    Customers and shareholders should be demanding changes in company leadership. This obnoxious conduct guarantees that the 777X program will be a disaster and other programs will be crippled by a strike in 2016.

    • Its utter incompetence of the International IAM with an assist by Tom W. IF ( and probably ) BA now comes back and thru the goodness of their heart says hey- we did NOT withdraw- then they win. Tom W is toast. And the IAM may well be ‘ broken ” The only difference between the IAM and SPEEA on the pension issue is that BA did not have to rely on the incompetence of the ” natiional ” IFPTE – the local SPEEA Staff filed that incompetence role quite well in addition to bullying the N team.

      • Don, The Local IAM members have ways of letting their Union know that they wish to vote on any proposal regardless of whether it is endorsed by leadership. It appears that there is some confusion/misinformation/ posturing that is blocking this negotiation process..

        The Herald Net offers a readers poll which indicates that 70% of the readers who voted think membership would accept the latest terms rather than have this plane build outside of Washington and Everett. I don’t know if this poll is representative of IAM members or speaks to the general readership in Everett

      • Don, As usual, your comments open the curtain of conflict to greater detail and understanding. They also introduce issues that govern the procedure of “negotiation” and clarify obstacles that intrude on the process.

        This said, what are the consequences of the ten (10) points you make to Jack Keller ( below). Put simply, if possible, given the accuracy of these points, how will or what will result under the present configurations of issues in this “negotiation/discussion/confrontation.

      • BA Investor

        I guess Boeing must balance the load between the different units. The fact is that defense budget is shrinking. It would be a mistake if they close defense related facilities when the commercial side is blooming.

        I would say that it would be normal that Boeing produce the 777-9 and 777-8 where it makes most sense.

        By the way, are you still reading my blog?

    • Boeing’s new offer is not obnoxious conduct but negotiations as called for by the NLRB. There is nothing keeping IAM751 from accepting the terms and joining the majority of companies in the US that have 401k retirement plans and employees that contribute to their healthcare costs. As a stockholder I support the company leadership in their attempt to put some controls on costs. The fact that IAM751 may not build the 777x does not guarantee failure as there are numerous centers of aircraft skilled labor throughout the country. And your strike threat does nothing for the Seattle area keeping aerospace work by any airframe builder.

      • Uhhn Jack – there is much about negotiations that you do not seem to know

        1) Supposedly the Union leadership negotiates on behalf of the members

        2) IF boeing made a BAFO best and final offer, that meets the NLRB requirement

        3) IF BA included a requirement that N team recommend it- that **may** be improper

        4) IF N team did not pick up the BAFO – negotiations are complete and Boeing need not do more

        5) it is unclear IF N team can refuse to let members vote, it depends on several not so obvious issues. Local Rules, national IAM rules, and NLRB rules re NOT letting members vote OR Boeing not having to ‘ allow” such a vote IF they said endorse it or else.

        6) There is currently NO strike threat,since contract in place till 2016 and the negotiations were over an extension- not the current. Which means they can stike in mid-late 2016 when contract is up and negotiations fail

        7) It is also unclear just what IAM national can do re voting having NOT picked up then BAFO

        8) The cost picture re Pension is even more complex- since surplus $$ in a defibned pension plan ( under wierd accounting rules for ” surplus” ) can be pencil whipped on paper into operating earnings at company discretion- and in the past have been.

        9) And it is also unclear what IF anything members can do re TomW- there may be NO provision for recall for example. Ditto for national

        10 In fact national IAM has their own problems re elections under DOL rules

  2. My God. Tom “The Phoenix” Wroblewski has risen from the ashes. From goat to hero in 24 hours….Rich “the Knife” MIchalski lays beaten to a bloody pulp in his corner…

    I’m sure Charleston will be at 3/month in 2016. maybe. Boeing will need the money to keep the lights on.

  3. Given the orders, Boeing’s cash & stock position, it won’t be too difficult to get high quality workers as well as the infrastructure needed in place to start building the B77X, B737MAX, more B787’s and eventully the NSA(not the current NSA which spies on us..LOL).

    The unions are certainly going to lose in the long-term. There is just as good if not better employees who will do the job at a better cost-basis.

    • In my opinion, your statement about Boeing’s cash and the quality of workers is incorrect.

      For Boeing’s cash, their revenue stream is pretty good. However, I suspect they do not have a lot of cash on hand that is not allocated for other projects. This would explain the RFP which requested an equivalent Everett site at little to no cost. They do not have the capital to invest in such a project on the time table they have proposed.

      As far as the quality of workers are concern, it has less to do with the union and more to do with the location of talent which can perform the work. Currently, the region which has the most experience to accomplish the required work on the 777x within risk, cost and schedule is in Puget Sound. There are certainly other parts of the country where this could happen, but it takes time to build up a mature workforce that has the same capability and can function independently. Could such a work force be ready in a decade? If done correctly, most certainly. I suspect this is where BSC will be by this time.

      Final thought, if the union represented machinists want to stay competitive in the eyes of Boeing Chicago, they will have to concede on the pension. That is the big sticking point.

      • @approx_volume.
        According to this, Boeing has a lot of money-enough to start a new project:

        http://finance.yahoo.com/q/ks?s=BA+Key+Statistics

        Even if its allocated for other projects, its still quite a considerable amount given that they have no “new” projects currently or in the foreseeable future.

        The RFP by Boeing is smart, they are working making places compete with each other to give Boeing the best deal-just like most do when say purchasing a car, tv, etc. IMHO it has nothing nothing to do with cash-flow problems.

        Given that the vast majority of the B77X program will already be mature (at least when it comes to avionics/fuselage manufacture & assembly), Boeing won’t need the 20+ years of IAM expertise for the B77X program like they did when they started the B787 program.

        Puget Sound certainly gives Boeing the best (lowest) risk, but it doesn’t mean other places won’t be able to produce either.

        Finally, we do agree on the pension part. Their particular pension method has gone they way of the dodo bird (or B&W TV, etc.). The union should understand what’s at stake for them.

      • According to this, Boeing has a lot of money-enough to start a new project:

        http://finance.yahoo.com/q/ks?s=BA+Key+Statistics

        Hey, that surely means they’d halso ave the money to actually buy property and build a new plant outside Washington themselves, rather than asking for somebody else to fork up the cost, doesn’t it?
        What? That’s irrelevant and it’s actually smart of Boeing to try to spend as little of their own money as possible on a new assembly line?
        Thought so.

  4. Adjusting compensation for standard inflation seems like a basic tenet of financial literacy. How’d that record breaking flight on a 777LR fly around a flat earth anyhow?

  5. Now I’m just confused. Why is everyone being so legalistic? Why would they issue a proposal that is dependent on the leadership accepting it when the leadership is only representing the members?

  6. Boeing’s current CEO’s mentor was Jack Welch at GE. When the unions and New York state refused to play ball with Welch on GE Power Systems building steam turbines and generators in Schenectady, NY, he established Greenville, SC as their new site for Gas turbines manufacturing. As that business boomed, steam and generators languished. Employment was over 30,000 in 1980. Now < 5000 as steam and generator still here. The IAM has to realize the price of job security in the global economy is a 401k. Otherwise, keep the defined pension plan and watch Puget Sound mimic Schenectady, NY.

    • Boeing’s current CEO’s mentor was Jack Welch at GE.

      Hmm – never saw his stint at GE in that light. It actually does explain an awful lot.

      • BTW- in a shareholder meeting around 2001 in Huntsville to avoid SPEEA, Phil Condit claimed he/company wanted to follow Jack welch methods. And of course harry stonecipher and mcnerney and a few board members are/were also welch wannabees.

        To welch- unions were below dog poop and to be treated as such

        Nothing has changed ..

  7. This is silly.

    The union leadership may be utterly pigheaded, but Boeing is perhaps worse. The Union behaving to type but you would expect a business to be, um, business-like.

  8. The membership needs to demand a right to vote on the proposal. Wroblewski works for the union not the other way around. I think after having the time to think about it IAM membership realizes the pension is going to die now or later. We might as well lose it while getting years of work placed in the Puget Sound region which softens the blow some. These are still excellent paying jobs, and they will allow future hires to continue to earn top dollar after 6 years. Call the national and local union reps and demand a vote. Boeing will allow a vote if they see membership supports it.

  9. BA investor re …This said, what are the consequences of the ten (10) points you make to Jack Keller ..

    Dammed if I know- I’m sure I missed several other significant points or issues- my point is and was that for 99.9 percent of outsiders to BA, outsiders to local unions, and having only tailored press releases and local union sites to view- what IS rfeally happening and what can really be done is obscure.

    BA/MDC/GE executives have long had a bitter battle with unions, and have for decades obscured real pension games- years ago they even whacked the pensions/benefits supposedly guaranteed to MDC workers and executives including Donald Douglas.

    The beat goes on

    • Don, You are right that this continuing bitter battle has gone on for a long time and has become institutionalized. It reflects attitudes from early times at McDonald Douglas and the subsequent merger culture and was reinforced by the Jack Welch School of Management.

      I wonder if things would have been different if Alan Mulally had been chosen as CEO. The 787 fiasco would probably have been avoided and Boeing could have been more generous with its success. But he was not a GE graduate

      Alas, this was not the script and reality is what is current.

      There are many Companies with solid cooperation between Management and Labor. Unfortunately Boeing is not one of them

  10. It certainly looks to me like neither side is serious about actually trying to reach a deal. Boeing continues to offer terms that is has to know the IAM is bound to reject and the IAM seems more interested in preserving its contract than preserving its jobs.

    I predict both sides are going to lose. Boeing will move the 777 out of Seattle at enormous cost as even with tax breaks etc. etc. Charleston has shown that creating a greenfield site is an enormous undertaking. The aircraft will likely be delayed and suffer quality problems for some time until the new site gets fully up to speed. Just as the 787 problems are costing Boeing orders I suspect that problems with the 777x related to a new greenfield site will have a similar impact.

    The IAM will watch as Boeing moves more and more work away from it and while it will have won the battle it will lose the war. People will lose their jobs and the future generation that the IAM wanted to protect will never come to be.

    It may well be true that Boeing can afford the IAM contract. But Boeing is a business and not a charity and I strongly suspect that it has decided that it will accept short term pain and losses in order to address the long term costs of the machinists contract.

    • It may well be true that Boeing can afford the IAM contract. But Boeing is a business and not a charity

      Funnily enough, workers aren’t just working for charity, either, happy to enable other people’s profits only.

      and I strongly suspect that it has decided that it will accept short term pain and losses in order to address the long term costs of the machinists contract.

      I wish them the best of luck with that.
      The 787 debacle and the time it takes SC to get up to speed on the 787 FAL (same for the Chinese A320 line, by the way) shows for just how long “short term losses” can be incurred. We’re now five years after the originally projected EIS, and there are still doubts over if/when the programme is going to break even.
      Which is why I think you have it the wrong way round – Boeing management prefers a short term victory over the unions (and the share price rise that’s likely to go with that, which in turn is going to translate into higher bonuses for some people) to a long term approach that will help them deliver a plane on time in ~7 years’ time. At that point, most of the current Boeing management will have long left, while the 777X will still have to be build and delivered on time.
      As I said – good luck with that.

      It’s generally not a good idea long term to treat your workers like expendable commodities. (Never mind treating them with open disdain.)
      The good people on your payroll will seek better terms and many will eventually leave for an employer that offers more gratification; which means you end up with a) less loyalty and more attrition and thus more need for training, less motivation/dedication etc. b) a weaker workforce, as a lot of good people will leave.

      I’m not pulling this out of thin air – this is actually what I’ve seen happening over the course of around 3 years despite attempts to contractually limit attrition and “poaching” by competitors.
      Sure, Boeing may find the holy grail of preventing this. I’m not holding my breath on that one, though.

      • We’re now five years after the originally projected EIS, and there are still doubts over if/when the programme is going to break even.
        Just to pre-empt something here: Yes, the same is true of the A380.
        The difference is that the 787 is selling like hotcakes and Boeing had more orders for the type before first flight than any other type ever had at that point.

        Which would all be in the past as valuable lessons learned – if Boeing didn’t insist on playing some of exactly the same games again that contributed to the delays in getting the first 787 delivered.

      • anfromme,

        Furthermore, I can tell you why the a380 didn’t make money in the past and why it will make money in the future (at least on a per-unit basis). However, no one has explained how the 787 will ever make money….ever (not even on a per-unit basis)!

        When I see a 1000 orders for the 787, I do not see a 1000 opportunities – I see a 1000 ways to lose money.

        Maybe someone would like to explain to me how I am wrong? I will listen.

        Thanks.

    • ITS A KUBUKI DANCE.. the decision re 777x has already been made- per the desires of the guy with the 100 billion checkbook.

      mcNearney and friends want to get the most out of the state of washington, and in the process destroy the union- And so far they have done a good job. TomW is toast even if he stays in office – a ‘ ten year’ or so contract- extension oby whatever name will decimate the union- most will go to paying agency fees- and or at an appropriate time ‘ work to rule”

      SPEEA is no longer a real player- they caved in way too soon

    • About the pension game

      http://online.wsj.com/news/articles/SB10001424052970204138204576605482876191482

      How Employers Raid Pension Plans

      By ELLEN E. SCHULTZ
      October 2, 2011
      When it comes to threats to your retirement, there’s one you may have overlooked: your employer. In recent years, companies have been freezing pensions, slashing retiree health benefits and eliminating 401(k) contributions.

      Companies claim they have no choice: They’re victims of a “perfect storm” of an aging work force and market turmoil. But if you’re one of the 50 million employees and retirees covered by a pension at a U.S. company, you can’t necessarily rely on what your employer tells you.

      Here’s a translation of some of employers’ most common claims:

      “Spiraling costs force us to freeze your pensions.”
      That’s partly true — but not the whole story. A little over a decade ago, pension plans had $250 billion in surplus assets. But employers siphoned billions from the pension plans to pay for restructuring costs, often by providing additional payouts in lieu of severance, and by withdrawing money to pay retiree health benefits — and in some cases parachutes for executives.

      When the market cratered in 2008, there was no surplus to cushion the blow, and today, pensions collectively are underfunded by 20%.

      With one big exception: Pensions for top executives continue to spiral, and account for much of the growing pension cost companies complain about. ..

      Goes on – but sounds familiar ?????

  11. The only point that seems even remotely significant in this “new” offer is this: “Boeing agreed to back down from its plan to keep new hires in progression for up to 22 years, and to go back to the current system that gets new hires to the maximum rate in six years.”
    But then, that still ties in with locking in the current starting salary for a good ten years, so how achievable getting to the maximum rate is actually going to be (as you won’t suddenly jump from the bottom of one salary band to the top of the next one up) is a different question altogether.

    Everything else just seems designed to buy time, and to be reneged by the time it would actually come into effect. For instance the additional $5000 sign-on bonus a mere seven years from now – when it’s only going to be ~$4200 in today’s money when adjusted for inflation, and when a few people will have left that won’t get the payment at all.

    Given McNerney’s compensation increase between 2007 and 2012, a contractually firmed 1% salary increase every second year no matter how well the company is doing, as well as locking in starting salaries for over 10 (!) years seems – almost comical.

  12. Fact: Boeing and the IAM Union must work together….or they will both fail.

    The failure of the 787 Program has proved this fact. However, it appears Boeing Management has not learned this fact.

    If Boeing Management does not learn the fact soon, then I see nothing but failure for the 777x Program.

    What more can be said?

    • Jimmy:
      “However, no one has explained how the 787 will ever make money….ever (not even on a per-unit basis)!”
      Are you for real? Are you telling me that all the 787-9 are sold at a loss? Is the 787-10 also sold at a loss? When they moved the numbers to 1100 units for program breakeven, this is the number required to recoup the money invested in the whole program, not the unit of item 1100. Airbus does not even mention the number required for program break even on the 380 anymore, choosing to put out a “per unit profit.” Boeing sold many of the first 787 for below the cost of what is costing them to build one, but is not all of them, unless they are really a charity organization like someone said above.

      • Jimmy is accurate. Boeing has somewhere north of $20 billion in losses on the program (not including the cash and product discounts given customers as 787 compensation). They have papered over these losses with sophisticated accounting and the fountains of cash created by the 737 and 777 programs.

        If you ever have a beer with someone who works within finance at Boeing (and they trust you not to quote them), you’d learn that the whole program has been written off internally. Not freakin chance of ever making a profit.

        The hope is that all the new technology and manufacturing techniques learned on the 787 program can be spun off into other products which will turn a profit.

        People who understand how things really work within the company have just been startled by the stock price rise….as it is completely decoupled from reality.

        • For Jimmy re unit costs … it depends on the definitions of ” cost ” Typical programs figure 300 to 500 planes to reach breakeven- even the 737 was on the ropes for several years in that all r&d costs had not been paid – and it was near dropping

          But if one looks at only the ‘ delivered ‘ cost ( parts and labor and flight test and assembly, etc) my guess is that around plane num 500 the late 7 will be at breakeven for out of pocket costs. But hat leaves a few billiion still to be written off. tax breaks will help, etc. But under program accounting- its doubtful that the 787 version one will ever reach true breakeven. But pencil whipping, and the -9 etc will aid in so called payback.

          warning – do NOT try that kind of accounting at home unless you want to enjoy the facilities at club fed>

      • Also have to consider though that as soon as the aircraft goes into service it starts generating non-project revenue for consumables, spare parts, services, and over the long-term engineering, consulting, reprinting, and under today’s environmental regs probably disassembly too. The capital equipment mfgr where I am now is putting huge effort into increasing aftermarket sales due to the high profitability and never ending market.

      • Well then, if the 787 with over a 1000 units sold does not look like it can ever make a profit, how about the A380 then with less than 300 units sold ever could? Even if the investment was one third of the 787 investment (which I doubt it could be that low) the program still needs more than 400 units at “regular price” then to get close to breakeven.

      • Oscar,
        Please indulge me while I elaborate, so that you may better understand where I am comming from.

        On a program basis that includes development and excess production costs, it is doubtful that the A380 will ever break even. In fact, I bet it won’t. However, in 2015, Airbus will have worked through the first 150 planes that were undersold and start making a profit on a per-unit basis. If Airbus can continue the good work, then perhaps…just perhaps….it is reasonable that Airbus could break even on the A380 Program Production costs at about the 600th plane. Of course, this again does not include A380 development costs – about $15 Billion development cost is already lost and written off…and it will probably never be recovered. But…that’s ok in the long term, for in the long term Airbus is financially healthy and they won’t be bleeding cash from the A380 Program.

        However, as dark as the A380 Program looks, it is a shining beacon of efficiency compared to the 787 Program. Assuming a constant 87.2% learning curve (which matches well to current figures for Deferred Production Costs), I calculate that Boeing will still be losing $20 Million per 787 even after 1100 units are produced. According to my model, Break-even on a per-unit basis occurs after 2600 units are produced, and break-even on a Program production basis occurs after over 8000 planes are delivered. And even after 8000 planes are delivered. my model says that the development costs aren’t even paid for!

        Of course, a constant learning curve is unrealistic – it’s a nice modeling concept, but reality doesn’t exist to accommodate my models. In short: all models have limits….including mine, of course. So…what does the real learning curve look like? Well, if it’s anything like the L-1011 manhour learning curve (http://www.econ.yale.edu/~lanierb/research/Learning_and_Forgetting_AER.pdf) or the 777 initial production curve (http://www.scribd.com/doc/174383745/Boeing-787-Learning-Cur-1), it flattens out at about 100-150 aircraft delivered (or about 4-5 years production): about where the 787 is now. If so, then things are even worse than my model predicts.

        There are precedents in history where production jetliners have lost money on a per-unit basis on every single unit sold: the Lockheed L-1011 is such an aircraft. Is the 787 such an aircraft? Can someone describe why the 787 will become profitable on a per-unit basis – much less on a Program Production basis or an entire Program Basis (i.e., Production + Development). I just don’t see it. I could be wrong. Someone….please help me understand.

        • RE the 380 and ‘ breakeven “.. generally under the terms of GATT92/WTO, a significant portion of ‘ research and development” costs are financed by government guaranteed loans such that IF sales/delieveries doe not meet a ‘ target ” of XX planes by YY years/months, then the remaining portionsof the ” loans” are forgiven.

          AKA as subsidies dependent on payback terms.

          OTOH Boeing, being private does not really have that option as to ‘ forgiveness”

          BUT lets not forget that say 100$ today is worth maybe 60$ in 15 years from now( the PV v FV issue. )

          So a simple model based on ‘ current’ spent $$ versus ‘payback ” $$ is slightly better than a random chance at the crap table.

          As you have mentioned, any analysis should be split into at least three parts. Current $$ to produce ( parts, materials shipping, assembly labor ,etc ) versus ‘ sales’ price, a second portion of XXX$/plane charged to ‘interest’, research, sunk, facilIties $$ charged per unit, and the overall net costs with the same factors of all the majo9r suppliers. Remember that on the late 7- most of the major vendors had to put up their share or research, design, facilities, labor, etc costs against their own profit margins. There may or may not be a problem when say around airplane 500 for the major supplieers to say, our costs are now up 50 percent- pay up- or we shut down.

          Or if the same suppliers are part of the 777x program, they will figure on getting even on the late 7 re costs of their parts.

          Bottom line- probably true the late 7 will by most normal- simple household econ analysis never ‘ breakeven ‘ re Boeing – but what about the ‘ partners’ ??
          and is the true BA costs/$$$/ etc just a portion of the REAL costs when major vendors are taken into account. ??

          FEW know for sure – and those that do certainly would NOT spill the beans over a cocktail. And much can be hidden by great power point presentations and shooting the messengers. As custer said ” where did all those *** indians come from ? “

  13. After spending a hour reading the comments on a Seattle Times article covering this story, it is clear to me that many of the union members that originally voted no are now reconsidering, especially in light of Boeing’s aggressive search outside of Washington. I get the feeling many members were overtaken with emotion at the time of the last vote and have since had some moments of “real world” clarity.

    • The big question is of course how representative those comments are of sentiment within the Everett workforce.
      There’s no way to tell for sure until you either have a new vote, or a representative opinion poll amongst union members.

      Personally, I don’t see how Boeing’s “new” offer can even be called negotiating if the only significant change is the removal of progression for new hires, plus a total of $6000 additional payment per head ($5000 additional sign-on bonus, $500 extra dental cover in 2020 and another $500 extra in 2024) of which the first part won’t even be paid for another 6 or 7 years.
      Given that even now, Boeing are going back on pension promises made only four years ago, as an employee I really wouldn’t bank on any of these payments ever actually being made.

      They didn’t even touch the two main issues – pension and salary (starting salary lock-in and only 1% increase every other year).

  14. BTW SPEEA pension plan is same as IAM and about a half dozen other smaller unions called BCERP or HERITAGE Plan

    SPEEA participation is about same as IAM re numbers of participants at a slightly higher pay/benefits

    SPEEA and others in the plan are not (yet ) frozen.

    Think about that re the cost game !!

  15. If Boeing wants to move to a 401K, great, I don’t think that would be ULTIMATELY unacceptable to union members.
    But that’s quite a concession…
    To also be imposing BELOW inflation wage growth, and concessions on health care is just asking an awful lot while offering little. And OF COURSE Boeing will be wanting negotiate further pay/benefit cuts when this contract is up, or the next time they try to force a re-negotiation onto the union… So why accept so many concessions now for so little?
    This was not “BAFO”.

  16. I have been on both sides of a labor conflict like this, and feel like I can see both sides.

    However, living in the real world, the IAM needs to wake up. The jobs they are “protecting” are not minimum wage jobs — far from it. Getting to top scale in 6 years is super fast. The union members are not losing a dime of their current pension and a 401k offers the possibility of a much better return through better investment options. The additional healthcare costs are minimal when compared to what others in the country are paying.

    The IAM made a statement a couple years ago about having the best paying jobs and the best benefits. I would venture to say under this proposed contract, that wouldn’t change. As the 54 responses to the RFP prove, a lot of people would kill for this chance.

    The union membership should have a chance to vote on this contract. The members are the voices that count on this deal and they should be ones deciding if the stability of 12 years of dependable employment is worth the changes — there’s no way I can call them concessions — in the proposed contract.

    With a vote, the members can decide their future — not Boeing or the Union management.

  17. More info from the IAM (751)

    http://www.iam751.org/121213_comparison_summary.pdf

    That being said, If BA really wanted a vote, they made a gross error in demanding 751 officially endorse it. It gave Wroblewski perfect cover with the international to reject.

    Just as the international forced the first vote, they had no power to force 751 to endorse it, and they didn’t.

    And even with Rich “the Knife” MIchalski in the room, he couldn’t do squat to stop Tom from leaving the offer on the table.

    It took awhile for me to see it, but there it is. The demand for an endorsement was probably not improper, but it was a crucial blunder by BA demanding it. They gave Tom an escape hatch from the international, and he bailed out.

    • The demand for an endorsement was probably not improper, but it was a crucial blunder by BA demanding it.

      I think it was actually not a blunder, but done on purpose as Boeing knew what the outcome of demanding an endorsement would be, and that it would give them perfect cover for their PR, which is going to run along the lines of “We are sorry the union chose to reject the offer; we are also sorry the leadership wouldn’t even let the members vote, and we do not think this is in the best interest of members.”

      • granted – the demand for endorsement being ‘ improper” is a ‘ grey” area re NLRB negotiations. And it may well have been to give TW cover. BUT it may also leave BA in an untenable position re establishing a new 777x line due to union issues, AND/OR in a bad position in 2016. IF the union gets P**** off enough, they could simply start working to rule at any time. That could easily cut production rates by 20 to 30 percent. BA typiically has loopholes re strike issues and delivery dates, but on work to rule issues ????

        IMHO – At least the initial 777x will be in Everett- and then on the basis of ‘ dispersion’ for weather, earthquake, diversisty- go somewhere else for a second line.

  18. “Boeing’s best chance for success – by far – is to build the 777X here in Washington state, utilizing the skills, experience and dedication of the finest aerospace workers in the world: the Machinists of District 751.”

    Telling each other you are the best a few dozen times, wave flags and look in history books just doesn’t cut it in todays aerospace world.

    Maybe there are smarter, younger, more eager forces elsewhere in the world. Wake up & smell the coffee.

    That said, I do not understand the Boeing offer, is it realistic and respectful or taking the union worker families hostage?

    • It is NOT incumbent upon the membership of IAM751 to prevent Boeing from making bad decisions and committing financial suicide by engaging in another 787-like debacle. Neither is it fair, or just, to place the responsibility for the economy of an entire state on the backs and the conscience of those same people.

      These are working people. What they are not are titans of industry. That’s Boeing. One of the most wealthy and powerful corporations on the planet.

      And people act as if it’s the moral obligation of some dude with a rivet gun who is trying to feed his family, to give in to the wishes of everyone and anyone but his own and his co-workers?

      I think there are a lot of people demanding the members of the Machinists Union vote, or vote a particular way to suit their own agendas, who really need to sit down and do some righteous self examination. Their moral compass is mis-calibrated.

      People act as if Boeing has no role whatsoever in this debacle. That this thing, this monster, is somehow the underdog to mean old Joe Lunchbox.

      ‘All the cool kids are giving up pensions and paying more for medical’ is the theme often used. As if it’s a requirement these days not only to have to live that way, but like it.

      Who decided that? Who decided to put the American Middle class on the downward slide into oblivion?

      If you are OK with that you are entitled to your opinion. You aren’t entitled to demand the members of IAM751 grease the rails on that long slide down.

    • Basically what I’ve been saying is there are other places with skilled labor who will work at more competitive rates.

      I dont’ see Boeing’s offer too bad – especially removing the now-obsolete pension plan in place.

      Maybe there is a little bit more of “give and take” left.

      Personally, I’m hoping for some kind of agreement but we’ll see.

  19. VV ? …By the way, are you still reading my blog?>>
    dont have a clue as to your blog ?? link ?? or just your comments here ??
    Today I’m otherwise occupied- so very few if any responses until this evening
    9 45 AM sat

    • Don,

      Sorry the question was for BA Investor. Never mind.

      In any case, i still think that Boeing needs to “balance the load” across its units. it would be a mistake to build 777-9 and 777-8 at any price in Washington when many facilities and jobs related to defense are under utilized.

  20. I’ll post three links to my site which contain 2 court documents and a few plots of mine re Pension issues

    The Millsap link is about in 1994 MDC closing the Tulsa facility after promising work there for a Saudi f-15 contract- after about 6 years in court and becasue A few executives were caught in outright lies by the judge MDC/Boeing lost. One executive wound up on Boeing Board, and another ( who apparently was not specifially accused of mis information wound up at a high level in Boeing for many years afterwards

    The SPANO link has to do with Boeing fees games on the 401K program and was listed in general terms in the annual reports starting in about 2006. the case is still in court.

    The purpose of the first two is to show just a portion of the past practices of Boeing regarding work locations- and improper fee issues in the Boeing 401K plan

    The pension plots Joelunchpail show how the current IAM-SPEEA and about 5 other union plans ( BCERP) really work. And how Boeing can save money via subtle wording and explanations while not wong- do not really tell the whole story.

    Readers are encouraged to read and make up their own minds as to the backroom games being played.

    http://tinyurl.com/BAMILLSAP2001 see page 70 to 73 for a good summary . .

    http://tinyurl.com/SPANO401KBA the fee games can significantly affect long term ‘ earnings’ by the employees

    http://tinyurl.com/JOELUNCHPAIL the hidden gotchas

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