Boeing’s Unions Continuing Failure to Embrace Negotiation
Robert Menard
Certified Purchasing Professional,
Certified Professional Purchasing Consultant, Certified Green Purchasing Professional, Certified Professional Purchasing Manager
In the 1990s, I did over a thousand public seminars, mostly in the US but also Canada and Europe. An embedded necessity of that profession is travel. Some weeks, I flew six times per week. Over the ensuing twenty years, while not traveling at that pace anymore, I have accumulated over 2 million air miles. So it is no surprise that any news stories about air travel or airplanes attract my interest.
In November, Mike Baker of the Associated Press Seattle bureau penned a story about Boeing reaching agreement with the State of Washington for a $9 Billion tax break. The tax savings, extending into 2040, are designed to keep production of the 777X generation of airplanes in Washington, mostly in the Everett (Seattle area) plant.
Although signed by Governor Jay Inslee in a very public ceremony on Monday, 11 November, 2013. However, later in that same week, Thursday, 14 November, the Machinist Union District 751 rejected an agreement that would have insured that the 777X generation of aircraft would be built in Everett.
What to hell were they thinking?
The Union cannot strike until the current agreement with Boeing expires in 2016. In the interim, Boeing can dangle the 777X work to a series of locations. On November 24, USA Today reported that Boeing had solicited bids from fifteen potential sites Boeing says it will choose a site within three months.
Was Boeing bluffing? Washington’s Governor Inslee and U.S. Senator Patty Murray, both liberal Democrats, apparently do not believe that Boeing is bluffing. Even the president of the International Association of Machinists in Washington, D.C., Tom Buffenbarger wanted District 751 to take Boeing’s offer. Incredibly, the Machinists district president, Tom Wroblewski, called the offer “crap”.
Have the Union members forgotten just four years ago when Boeing demanded a 10 year no-strike deal to keep the 787 line in Everett. The intransigent Union refused and now Boeing is making the planes in South Carolina, along with billions in investment in the local community. Boeing was not bluffing in 2009 and likely are not now either.
The Union needs help in negotiation.
If the Machinists want those jobs in Everett, they should send negotiators back to the table. That move is up to the Union and they should do it now! Boeing will find a hospitable location to build the 777X. It must price the airplane today for delivery in the ten years out so it must know its costs of production. This is not difficult to understand. Either the Machinist Union District 751 recognizes this obvious reality or they will read about the plane’s success in other states.
Four years ago, Boeing threatened to set up a second 787 line in South Carolina unless the union here agreed not to strike for 10 years. Then the political friends of labor said publicly it was not a bluff. In 2009, the union’s negotiators ignored this and said “no” to the company’s offer. Public announcements by labor stated that the Union “would not be stampeded.”
Huh? The top pay ($33 to $43 per hour in various grades) remains, and continues to be protected from inflation — unlike most private-sector pay. Workers would have investment risk on their retirement, but most American workers have had to accept that. Boeing offered to fund the Machinists’ retirement savings with essentially a 10 percent match, and in the first few years even more.
A Seattle news source reported that the Union’s “decision to say no to Boeing’s offer cannot be explained by economics. It was emotional.” For the Union to mount a Win-Win negotiation, it needs to get a lot more rational.