Boeing announces voluntary layoffs in Puget Sound

By Bryan Corliss

April 28, 2020, © Leeham News: Boeing on Monday formally announced it would offer voluntary layoffs – essentially contract buyouts – to members of its Puget Sound workforce.

For most workers, the offer would give them one week’s pay for each year of service, up to a maximum of 26 weeks. Boeing would also continue paying health insurance benefits for most of the laid-off workers for three months. (The exception to this: Machinists Union members will get six months of extended health benefits under the terms of an agreement negotiated in 2016.)

Acceptance by May 4

Workers have until May 4 — one week — to decide whether they’re going to apply for the buyouts. In a message sent to its members, SPEEA, the engineers’ union, said Boeing management will decide who gets to take them, and warned its members they might be required to train their replacements before leaving.

Union sources said Monday it wasn’t clear how many people Boeing is looking to cut from its payroll. However, the Machinists said that Boeing wants to eliminate jobs in 140 job codes in what would be a sweeping restructuring.

Workers who get the buyout packages would be notified in mid-May, and leave the company in June, a Machinists spokeswoman said.

Good news for some

The announcement was likely to be seen as good news for many of the older members of the Boeing workforce, who’ve been looking for the buy outs as a way out of their current Covid-19 conundrum: go back to work and risk infecting themselves and their families, or stay home and risk financial hardship.

About a quarter of Boeing’s unionized workforce – both engineers and mechanics – are older than 55. For them, the buyouts “may be a positive opportunity for those who are ready to retire to utilize additional benefits that were not otherwise available to them,” Machinists Union district leaders in Seattle told their members. Boeing under ex-CEO Jim McNerney froze defined-benefit pensions for all workers, however, most of the workers who’d be taking these buyouts still would have modest pension benefits coming that they accrued prior to the freezes. And since they’re being laid off, the workers might qualify for unemployment compensation from the state of Washington, the Machinists told their members Monday night.

Other job cuts

The news from Boeing comes as at least a half-dozen aerospace suppliers and aviation companies across Washington state announced both temporary and permanent job cuts over the past month.

The list of companies includes:

  • Northwest Aerospace Technologies in Everett, which has eliminated the jobs of 83 of its engineering workers while sending home 92 more on a temporary layoff;
  • Universal Aerospace, a machine shop in Arlington, which temporarily laid off 150 aerospace workers in late March;
  • Toray Composites in Tacoma, which temporarily sent home 361 workers in April;
  • LMI Aerospace, an aerostructures supplier that in April temporarily laid off 74 workers at its Auburn plant and 25 more in Everett;
  • Hexcel Corp., which has eliminated the jobs of a total of 288 workers at plants in Kent and Burlington; and
  • Safran Cabin Bellingham, which eliminated the jobs of 205 workers last week; that’s out of a work force of 475, the Bellingham Herald reported.

5 Comments on “Boeing announces voluntary layoffs in Puget Sound

  1. Not mentioned is the wave of workers that were about to retire regardless. That is a pretty large group by themselves.

    I don’t see how you train your replacement in a few weeks, its not a burger flipping job.

    I find the notion that Covd-19 drives the decision as implausible.

    Voluntary retirement should not be a mechanism for stealing unemployment. There are people who desperately need that who are truly unemployed and not some splitting hair thing.

    • At the end of the day considering all that’s gone down in the last couple of years, or even the last couple of decades, Boeing will probably have no trouble getting people to leave. With the MAX problems, general lack of vision at the top, the Covid shutdown – lots of people with twenty years in will say that’s enough. And like others places, people that have a lot on the ball, will want to use the time and package to strike out in another direction. There’s always the chance of a brain-drain, but it appears to be fairly accepted that Boeing Corporation is not going to pursue in the words of that illustrious leader McNerney no “Moonshots” in the foreseeable future.

      • Funny how its a moonshot when management hoses it up!

        What we can count on is Boeing mgt will continue to shoot Boeing in the foot, they will take their Uzi and mill it off completely and then start in on the other one (or have they already?)

  2. “I don’t see how you train your replacement in a few weeks, its not a burger flipping job. ”

    Fair point, but keep in mind with Boeing executives it is all management by Powerpoint so the details do not really matter.

  3. Working at one of the major defense contractors I see these VLOs come around every couple years as they struggle to manage their cost basis and create career growth opportunities for mid career engineers who are stalled and likely flight risks.

    we inevitably see a bunch of guys who have long been retirement eligible take it and many who had planned to retire within 6 months anyway take it.

    had a guy in the next cube who was specifically holding out for a VLO because it meant he would get a “free” 6 months of pay , benefits and pension accrual. (rumors had been circling for a few months, and he withheld his retirement papers once he heard them, stayed 3 months past his original planned date to cash in) when they announced the VLO he was standing in the Dept Mgrs door within 10 minutes.

    had another guy who was dying of cancer, but wouldn’t retire because he needed the health care so as not to leave his wife bankrupt. he was the second one in the door of the DM. got the 6 month VLO and structured his pension to maximize survivor benefits. died within 3 months. because he was still in the layoff period, his company term life insurance (which he had also maxed out) paid off full. sad but smart.

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