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Ballots being counted at the IAM District Lodge 751 Union Hall in Seattle on Nov. 4.
Front-line workers represented by the International Association of Machinists (IAM) voted Nov. 4 to accept Boeing's latest contract proposal, ending their 53-day strike and clearing the way for work to resume on three key Boeing Commercial Airplanes (BCA) programs in the coming days.
Employees represented by IAM District 751 and W24 voted to accept the deal, with 59% approving the contract, IAM 751 President Jon Holden announced once the tally was known late Nov. 4.
"It's time to get back to building airplanes, increase the [production] rates and bring this company back to financial success," Holden said in a press briefing.
More than 26,000 of the 33,000 striking members voted, Holden said.
Highlights of the new, four-year contract include a 38% boost in general wages, increased 401(k) contributions and a company commitment to build any new aircraft announced during the deal's duration in the Puget Sound region—a stipulation union leadership intends to grasp tightly.
"They've never given us a commitment for an airplane program before it's launched, before it's designed," Holden said. "If it doesn't launch in this next four-year period, then it's still in our contract, and we fight for it next time. If they try to take that away, then we have the power to keep it, because our members are strong."
With a new deal in place, workers can begin returning as early as Nov. 6. They are required to return on Nov. 12 at the latest.
The strike began Sept. 13, effectively shutting down Boeing's 737, 767, and 777 production operations in the Puget Sound region. Deliveries out of affected aircraft programs were limited to aircraft already approved to go before the strike started. Work on 787s in South Carolina, done by non-union employees, continued.
Employees rejected a second tentative agreement Oct. 23. Another offer presented by Boeing in late September was rejected by union negotiators and not presented for a vote.
The union's original requests included a 40% wage increase and restoration of pensions given up in 2014 in exchange for ensuring 777X production stayed in the Puget Sound area. The lack of a pension in the latest deal likely kept the 59% approval figure from being higher.
"We just couldn't get the pension out of this company," Holden said. "We'll continue working on that issue—retirement security—for the rest of our lives.
"We locked in the success that we have," Holden added "We had a lot of it, and that was a good decision by our members. And now we go back and we rebuild and we repair relationships where we need to."
Word of a deal with the machinists comes three days after Spirit AeroSystems and SPEEA’s Wichita Engineering Unit reached an agreement on a new deal for more than 1,000 engineers that work at the key aerostructures supplier. The four-year agreement removes a potential headache for Boeing, which is in the process of acquiring Spirit as part of a larger strategy to take greater control of its supply chain.
Under the deal, the engineers will see wage increases of at least 19%, and possibly more based on market conditions. The current agreement expires Dec. 1, and the two sides negotiated for a month before suspending talks on Oct. 7 due in part to uncertainty related to the IAM walkout.
With major labor issues addressed for now, Boeing CEO Kelly Ortberg can focus on his most important long-term tasks: restoring stability to the company's major programs, earning back confidence among regulators, suppliers, and customers, and mapping out a leaner, more focused strategic plan. Ortberg was five weeks into his tenure when the IAM strike began Sept. 13, stalling any momentum he was building in what he acknowledges will be a long-term effort to turn Boeing around.
The IAM strike also halted Boeing's rollout of various initiatives aimed at addressing myriad production quality problems flagged in several reviews by both internal and external teams, including the FAA. New training, material and tool tracking, and inspection protocols are among the tactics being introduced on BCA's final assembly lines and at some supplier sites to cut down on mistakes and rework.
The overall operational goal: improve product quality to help support planned production and delivery ramp-ups planned for the next several years, particularly for the 737 and 787 programs. The increased output is the most important factor in the company's financial turnaround plan.
"While the past few months have been difficult for all of us, we are all part of the same team," Ortberg said in a message to all employees sent after the vote was announced. "We will only move forward by listening and working together. There is much work ahead to return to the excellence that made Boeing an iconic company.
"This is an important time in our history, and like generations before us, we will face into the moment together, and stronger as one team," he added.
Holden said that while his relationship with Ortberg is "new," the union leader has heard "a lot of good things" about the new CEO's capabilities, particularly in operations and engineering.
"I think it's a positive move," he said of Ortberg's hiring. "We've got to build that relationship, and we will."
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