Boeing’s new CEO, Kelly Ortberg, has taken a decisive role in the ongoing negotiations with the Machinists union, delivering a stark message this week: if striking union members reject the company’s latest contract offer, future proposals will be less favorable.
This statement was made during direct discussions with union leadership amid a protracted strike that has lasted over 50 days.
Jon Holden, the leader of the Machinists union, shared Ortberg’s position, noting that the company could not continue to concede further in negotiations. Holden emphasized that the next offer from Boeing could be “regressive,” potentially resulting in the loss of various gains that had been achieved thus far, such as commitments to build future aircraft in the Puget Sound area, a proposed 38% wage increase, and a 1% decrease in healthcare costs.
While Boeing has not explicitly detailed what might be removed from the current proposal if it is rejected, Holden indicated that the company is contemplating multiple options. The strike, which began on September 13, has halted operations at Boeing’s assembly plants in Renton and Everett, and union members previously rejected two offers, believing they could negotiate better terms regarding pay and retirement benefits.
In light of Ortberg’s message, the union’s negotiating team is recommending that its 33,000 members accept the current offer, which includes an incremental improvement from the last proposal. This offer consists of an additional 3% wage increase, culminating in the previously mentioned 38% raise over a four-year period, which Holden described as “life-changing wages.” He noted that this wage increase represents the highest the union has ever received.
Initial feedback from union members suggests a range of reactions. Some workers expressed concern about accepting the proposal, fearing they might lose out on potential gains if they reject it. Others, however, are experiencing financial strain and are more inclined to accept the offer in order to return to work.
Holden recounted a recent virtual meeting with over 500 union members, where the majority seemed to lean toward acceptance of the new offer. However, dissent still exists within the ranks, with some members insisting on holding out for better terms.
The backdrop of this negotiation is compounded by the financial impact of the strike on workers, with analysts estimating an average loss of $10,400 in wages for those on the picket line. This figure approaches the $12,000 ratification bonus on the table, as well as the first-year wage increases offered in the contract.
Amid these developments, Boeing has also raised $21.1 billion through a share sale, potentially strengthening its negotiating position. The company’s latest offer, while not reinstating a defined benefit pension, allows workers some flexibility in how they receive a combined $12,000 payment related to their wages and retirement.
With the union’s vote scheduled for Monday, Holden expressed cautious optimism about the negotiations and reiterated the importance of the decision resting in the hands of the union members.
“I hope that they can accept this as a victory and move forward,” he said.
The Seattle Times contributed to this report.
