Striking workers of Boeing Defense in the St. Louis area rejected the company’s newest contract proposal, extending a nearly three-month strike that has already disrupted fighter jet production and other key programs.
In a statement after the vote, union leadership said the company had failed to address the needs of the roughly 3,200 members of the International Association of Machinists and Aerospace Workers (IAM) District 837.
"Boeing claimed they listened to their employees - the result of today's vote proves they have not," IAM International President Brian Bryant said in a statement. "Boeing's corporate executives continue to insult the very people who build the world's most advanced military aircraft - the same planes and military systems that keep our servicemembers and nation safe."
The five-year offer was largely the same as offers previously rejected by union members.
The company reduced the ratification bonus but added $3,000 in Boeing shares that vest over three years and a $1,000 retention bonus in four years. It also improved wage growth for workers at the top of the pay scale in the fourth year of the contract.
"To fund the increases in this offer, we had to make trade-offs," including reduced hourly wage increases tied to attendance and certain shift work, Boeing Vice President Dan Gillian said in a message to workers on Thursday.
IAM leaders have pressed the planemaker for higher retirement plan contributions and a ratification bonus closer to the $12,000 that Boeing gave to union members on strike last year in the company's commercial airplane division in the Pacific Northwest.
Boeing's Gillian has called the company's offer a landmark deal and "market-leading," and he has repeatedly said Boeing would not increase the overall value of its terms, and only shift value around.
Boeing is expected to report another unprofitable quarter when it posts its third-quarter results on Wednesday. Wall Street analysts anticipate the company will announce a multi-billion dollar charge on its 777X program, which is six years behind schedule and not yet certified by regulators.
In September, IAM members approved the union's proposed four-year contract. However, Boeing management has refused to consider that offer.
The IAM estimates that its offer would add about $50 million to the agreement's cost over its four-year duration, compared with the company offer that was rejected. Boeing CEO Kelly Ortberg is set to earn $22 million this year. Union officials accused Boeing of bargaining in bad faith in an unfair labor practice charge filed October 16 with the National Labor Relations Board.
"It's well past time for Boeing to stop cheaping out on the workers who make its success possible and bargain a fair deal that respects their skill and sacrifice," Bryant said.
Union members say they are getting by on a mix of $300 a week in strike benefits from the IAM, second jobs, and belt-tightening.
Boeing has said that striking workers' coverage under company-provided health insurance ended on August 30. Since the strike began on Aug. 4, Boeing officials have repeatedly said the company's mitigation plan has limited the effects of the work stoppage on production.
However, it has delayed deliveries of F-15EX fighters to the U.S. Air Force, General Kenneth Wilsbach told the Senate Armed Services Committee in comments submitted for a October 9 hearing on his nomination as the Air Force's chief of staff.
