Jamie Spencer
In an urgent bid to resolve the ongoing strike that threatens to disrupt its production, Boeing has presented the Machinists union with an unprecedented contract offer. Delivered on Monday morning, the new proposal is aimed at addressing worker concerns and expediting a return to the assembly line, with hopes of swiftly ending the work stoppage.
Largest Contract Offer in Boeing’s History
Boeing’s chief negotiator, Mike Fitzsimmons, highlighted the significance of the new proposal, describing it as the most substantial offer ever made to any union in the company’s history. “We hope it addresses the concerns of both the union and the members, and we hope they vote on it soon,” said Fitzsimmons.
The offer comes at a critical time as union members face the prospect of missing their first full paycheck, with company health coverage also set to lapse at the end of the month if the strike continues. Boeing’s new CEO, Kelly Ortberg, has taken a hands-on approach in shaping the offer, signaling the company’s eagerness to resolve the dispute quickly.
Pushing for a Swift Resolution
Boeing vice president Peter Johnson echoed the urgency to bring the strike to a close and resume production. “The sooner we get those people back, shoulder-to-shoulder with us, working through building the airplanes and getting through the problems we have, the better off we all are,” Johnson said.
The strike has already begun to strain Boeing’s operations, and the company is keen to get its production back on track as soon as possible.
Key Improvements in the New Offer
In response to the union’s concerns, Boeing’s revised contract proposal includes a significant pay raise of 30% over four years, a notable increase from the 25% in the previous offer, which was rejected by union members. The new pay structure starts with an immediate 12% raise, followed by 6% annual increases for the next three years.
Additionally, Boeing has reinstated the annual bonus, which had been removed in the previous offer. This bonus will provide a variable pay increase of approximately 4% each year, further boosting overall compensation.
The signing bonus has also been doubled to $6,000 for each Machinist upon contract ratification. However, despite these improvements, the offer still does not include a return to the traditional defined-benefit pension, which remains a key sticking point for many union members. Instead, Boeing has enhanced its 401(k) contributions, now offering up to 12% of base pay through a combination of automatic and matching contributions.
Union’s Response and Next Steps
The new offer follows the union’s rejection of Boeing’s previous proposal, which underscored a gap between what Boeing believed it had offered and the expectations of the union members. “We’ve listened. We’ve heard the feedback from multiple sources, and we’re making our best effort to balance the realities we have in our business today with promoting the team that builds these magnificent airplanes,” said Johnson.
Fitzsimmons confirmed that the new offer is Boeing’s “best and final” proposal, a designation not applied to the initial offer.
The International Association of Machinists (IAM) is required by its constitution to put Boeing’s revised offer to a vote. The union vote is expected to take place later this week, with Boeing setting a deadline of 11:59 p.m. Pacific Time this Friday for ratification. The outcome of the vote will determine whether the strike continues or if the union members will return to work.
The Stakes for Boeing’s Future Operations
As negotiations continue, Boeing remains committed to producing its next-generation jet in the Puget Sound region. While other terms from the previous offer remain unchanged, the company’s focus is on getting workers back to the assembly line and ensuring that its production goals are met.
For Boeing, the stakes are high. The strike’s continuation could lead to further operational delays, while resolving the dispute would enable the company to move forward with its ambitious plans.
As the Machinists union prepares to cast its vote on Boeing’s significantly improved contract offer, the company is hopeful that the enhanced terms — including higher wages, bonuses, and improved 401(k) contributions — will be enough to end the strike and bring stability back to its operations.
