Boeing strike ends in union win

November 4, 2008

Darrin Hoop explains why, after two months on strike, workers at Boeing approved a deal that draws the line on outsourcing and makes gains on wages and benefits.

THE BATTLE at Boeing is over. On November 1, after 57 days on strike, the 27,500 members of the International Association of Machinists and Aerospace Workers (IAM) voted by 74 percent to ratify a four-year contract with the corporate giant Boeing.

"Our union has delivered what few Americans have--economic certainty and quality benefits for the next four years," said District 751 President Tom Wroblewski in a statement posted on the union's Web site.

"After 57 days of striking," Wroblewski said, "we have gained important and substantial improvements over the company's offer that was rejected on September 3. I am proud to be a member of the machinists' union and want to thank our members for their solidarity and commitment."

This contract should be seen as a victory for the IAM and for organized labor. The union stopped Boeing's demands for health care concessions and retained the same benefits achieved in the last contract. The agreement offers general wage increases of 15 percent over the life of a four-year contract (5 percent the first year, 3 percent in the second and third years, and 5 percent in the final year).

IAM members and supporters rally as contract negotiations with Boeing Co. entered the final week
IAM members and supporters rally as contract negotiations with Boeing Co. entered the final week (Jim Levitt)

Also, starting pay for all workers on minimum wage rates will go up $2.28 per hour. In addition, there's an immediate bonus of $5,000, or 10 percent of a workers' annual salary, including overtime--whichever is greater. Plus, there will be bonus money of $1,500 in 2009 and $1,500 in 2010.

"I'm not surprised it passed," said Steve Parsley, a 19-year crane operator. "There was a lot of money thrown up front. The leadership recommended the members accept, and they accepted it. I've watched people the past few days. They're worried about losing their house.

"Lots of people thought it would be a one or two-week strike. Could we have won more? Yes. Did we make improvements? Of course. It's hard to say we didn't."

Other gains, according to the IAM, are the pension increases of $11 for the first three years and an additional $2 in the final year. This is the largest dollar increase for pensions in union history, and will lead the aerospace industry.

And in the single biggest issue for the machinists, the contract also limits outsourcing. The IAM says that it recaptured the scope of work that was lost in the 2002 contract. It says there is job protection for over 5,000 members in the parts delivery and facilities maintenance work. Boeing's previous proposal could have led to at least 2,000 job losses.

THE STRIKE cost Boeing 38 percent of its third-quarter profits. It led to a net loss for Boeing of more than $1.3 billion in the first month of the strike alone. Some analysts say that the cost of the second month of the strike was an equal, if not greater amount. And it shut down the largest exporter in the U.S. and the Pentagon's number two military supplier.

Furthermore, compared to the last two IAM contracts, in 2002 and 2005, that opened the door for massive outsourcing at Boeing, this contract will slow the bleeding.

Nevertheless, the contract does have some shortcomings--weaknesses that led a group of militants at the Everett, Wash., plant to organize for a "no" vote, arguing that Boeing had the ability to come up with a much better wage-and-benefits package.

Boeing has had record profits of $13 billion since 2002. It has a record eight-year backlog of more than 3,400 plane orders worth $349 billion, according to MarketWatch.

Nevertheless, the wage increases are the same as Boeing's previous proposal. Boeing was offering 11 percent over a three-year contract. The only difference is that Boeing added a 4 percent increase in the fourth year. And while the pension increase may be the largest dollar amount in IAM history, it comes out to a 16 percent increase, the same pension improvement that the union won in the 2005 contract, when Boeing's profits were much smaller than they are today.

While many strikers like Steve Parsley recognized the gains in the contract, Parsley and others also disagreed with the way some of the "gains," like in health care, were sold to the machinists. "People said we made improvements in health care because we maintained the same level of benefits from the 2005 contract," he said. "Some are saying with health care costs rising, the fact we maintained the same coverage means you end up saving money because costs are going up each year. But to me, we held our ground."

Another criticism of the contract is that the proposal doesn't pay the 40-cent cost-of-living adjustment (COLA) for May, June and July that Boeing refused to pay before the contract expired. And although the union won the right to bid for work that's being outsourced to non-union Boeing facilities, the contract language doesn't guarantee that Boeing will award any future jobs it wants to outsource to the IAM. Nor will this contract stop the outsourcing of work for the future of Boeing's commercial airline business, the 787.

MANY MACHINISTS feel they could have won even more if the membership had voted this contract down and continued the strike. As Parsley commented, "I think the fact that Boeing was prepared to lose that much money compared to what the proposal was from the union is very sad. This shows Corporate America is in it for itself to make a fast buck and to disregard the American worker."

But despite this, the solidarity that was built and the tremendous organizing that rank-and-file activists did from well before the strike all the way to the end of it should provide inspiration for workers all around the U.S.

Starting in early August, rank-and-file machinists like Parsley and the 31-year crane operator, Don Grinde, helped to lead initially weekly rallies and marches in and around the Everett plant. In the last week before the strike, there were daily rallies on all three shifts. The biggest one reached some 7,000 machinists.

Once on strike the crane operators led by example by organizing a weekly four-hour barbecue for any strikers and their families on the Everett picket line. Complete with two grills going at all times and sometimes a live band playing, the picket line kept the spirits high and provided a space for lively debate about the issues of the strike.

The high point of solidarity took place on October 9, when more than 300 machinists and their supporters from a number of unions held a barbecue, rally and walked the picket line at Boeing Field in Seattle.

And finally with only one full day to build a "Vote No" campaign after the union made the entire contract proposal available before the November 1 contract vote, Grinde and others quickly posted two different versions of a "Vote No" flyer on his rank-and-file blog. Then on November 1 in Everett, at least a dozen machinists and supporters handed out over 4,000 copies of these flyers to their co-workers as they headed to vote.

When asked to summarize the lessons of the strike, Parsley explained how it helped to build a bigger and broader network of rank-and-file activists:

I think the strike helped the network. There's more communication than there's ever been. Employee's networking together was exceptionally well done. When it came to letting people know the information, know about rallies, it's better than it has ever been. Are there ways to improve? Absolutely. For me, I need to get out there earlier to start talking to others. Although we started months in advance, we need to start come Monday when we go back to work.

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