Boeing: workers accept agreement providing for a wage increase, ending seven weeks of strike

This will have cost the company and its suppliers more than ten billion dollars. Striking Boeing workers accepted a new draft social agreement this Monday evening, thus ending a walkout of more than seven weeks. After rejecting two offers, IAM-District 751, branch of the machinists’ union (IAM), indicated that it had approved by 59% the agreement providing for a salary increase very close to its demands, but not the restoration of the old retirement scheme.

More than 33,000 employees in the Seattle region, in the northwest of the United States, will return to two major assembly plants. “The strike will end and it is now up to us to get back to work and start building the planes, raise prices and get this company back on the path to financial success,” said Jon Holden, president of IAM-District 751, during a press conference. “I am proud of our members,” he added. “They have accomplished a lot and we are ready to move forward.”

Salary increase of 38%

The project announced this Thursday evening includes a salary increase of 38% over the four years of the social agreement. The union demanded 40%. Many employees also hoped for the reestablishment of the guaranteed amount retirement pension system – 42% of current union members had one – which was abolished by a social agreement in 2014 in favor of a capitalization system. “I think Boeing can do better. They can give us back our retirement and do more in terms of work-life balance,” said Mike Corsetti, quality inspector for 13 years, this Friday.

According to the Anderson Economic Group, this is the costliest strike of this century in the United States with more than $11.56 billion in direct impact since September 13, including $6.50 billion in shortfalls. to gain for Boeing and 2.87 billion for its suppliers.

United States President Joe Biden “congratulated” the union and the firm “for reaching an agreement that reflects the hard work and sacrifices of the 33,000 machinists” and also mentioned the support of his economic team. “Over the past four years, we have demonstrated that collective bargaining works. Good agreements benefit workers, businesses and consumers and are essential to the growth of the American economy,” he said again, on the eve of the presidential election.

Consequences on customers

This is Boeing’s fourth offer since the beginning of September, but the third submitted to a vote by members. The first, rejected on September 12 by nearly 95% of union members who also voted for an immediate strike, provided for an increase of 25%. Boeing then offered 30%, then 35% and, finally, 38%. The group also reinstated an annual bonus (4% of annual salary), increased the ratification bonus (from $3,000 to $12,000) and increased the contribution to the funded retirement plan.

It has maintained its commitment to manufacturing its next plane – expected by 2035 – in the Seattle region, birthplace of Boeing, which represents a guarantee of tens of thousands of jobs for several decades. The strikers, without health insurance since the end of September, had received $250 per week from the union since the fourth week of the strike, and some depended on food banks to keep them going.

Union leaders had recommended ratification of the first offer, arguing that they had no guarantee of obtaining more with a walkout, but they abstained in the second vote (64% rejection). The end of the strike is crucial for Boeing, in great financial difficulties because the walkout paralyzes the two factories producing the 737 – its flagship plane -, the 777, the 767 and several military programs.

Boeing customers were also waiting for the social conflict to be resolved. Michael O’Leary, boss of Ryanair, estimated on CNBC that delivery and certification delays (737 MAX 7 and 10) will deprive it of 15 million passengers in 2024 and 2025.