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Aircraft Parts, Distribution, Labor and Personnel Issues, Manufacturing

Boeing Strike May Be Imminent

On August 24th, Reuters reported that Boeing had offered made an offer to the union, but the International Association of Machinists and Aerospace Workers (IAM) called the offer “insulting” and it repeated its threat to strike in early September.

IAM represents 27,000 Boeing workers – mostly in the Seattle area. Boeing offered IAM’s members a pay raise of 2.5 percent the first year and 2 percent in each of the following two years. IAM’s counter-proposal included a substantial increase on the pension, improvements in health care, and retiree medical and pensions for all employees. Boeing’s proposal would stop offering retirement medical coverage for future hires, and would put new workers into a defined retirement benefit plan rather than the traditional Boeing pension fund.

Although IAM spokesperson Connie Kelliher did not tell the paper how much of a wage increase the union was seeking, she did state that the trend for the overall aerospace industry was for gains of around 9 percent to 13 percent over three years, and she explained that “We would be expecting for at least the industry trend.”

Boeing has previously said that it will propose its best and final offer right before Labor Day weekend.

Boeing spokesman Tim Healy said the two sides were “making progress” and the company was optimistic that an agreement would be reached before Labor Day weekend. Reuters predicted “a strike is likely given the fractious history of Boeing and its workers.”

The IAM has gone on strike three times in the last 20 years. Its members walked off the job for 48 days in 1989; for 69 days in 1995; and 28 days in 2005. The union rejected Boeing’s final offer in 2002, but obtained less than the necessary two-thirds voted for a strike, which meant the contract was accepted by default.

A strike could cost Boeing billions of dollars, and could cause flight interruptions if necessary spare parts become unavailable. PMA manufacturers should watch this closely because PMA parts may be necessary to keep the industry flying.

Article: http://www.reuters.com/article/businessNews/idUSN2446712820080824?pageNumber=2&virtualBrandChannel=0

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About Jason Dickstein

Mr. Dickstein is the President of the Washington Aviation Group, a Washington, DC-based aviation law firm. He represents several aviation trade associations, including the Aviation Suppliers Association, the Aircraft Electronics Association, the Aircraft Fleet Recycling Association and the Modification and Replacement Parts Association.

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