Boeing faces massive strike as union members vote on collective bargaining agreement today

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CNN
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Boeing hasn't had much success over the past five years, and by this time tomorrow, the crisis-hit company could add another mess to its growing list of problems: A massive strike by 33,000 workers could bring aircraft production at America's largest exporter to a standstill and deal a severe blow to the U.S. economy.

Boeing faces a crucial union vote tonight that could lead to workers walking off the job at a parts center in Oregon, as well as two airplane factories and a Seattle-area assembly plant. The strike could go ahead even though the union and the company have reached a tentative agreement on a four-year contract to avoid a walkout.

Among other benefit increases, the contract would increase union members' pay by at least 25 percent over four years. Union leadership called the tentative agreement Sunday “the best contract we've negotiated in our history.” But workers are angry: They feel they were pressured years ago to agree to two deals that stripped them of their traditional pension plans and forced them to pay more for health insurance.

The union had agreed to these unpopular deals in recent years when Boeing reported strong profits. At the time, it agreed to the concessions because it feared Boeing would shift union jobs to nonunion plants that the company was threatening to build.

Worker anger has also been building up over years of problems that have been tragic, embarrassing and financially devastating for Boeing. Those problems include two fatal crashes that killed 346 people, a 20-month grounding of its best-selling jet and a doorstop that came flying off an Alaska Airlines flight last January because the plane left the factory without the four screws that hold it in place. Boeing pleaded guilty earlier this year to misleading regulators. Since it last reported a profit in 2018, Boeing has amassed more than $33 billion in operating losses, and its credit rating has fallen near “junk” status.

Union members have launched a series of protests outside Boeing plants this week and may ultimately reject the new collective bargaining agreement that union leaders have negotiated with Boeing management. If they reject the deal, they could vote for a strike early Friday.

A strike would have no impact on private travel. Boeing planes already delivered to airlines and in service around the world would continue to fly. But there would be a delay in the delivery of the jets promised to airlines, cutting off Boeing's main source of revenue.

Depending on how long the strike lasts, it could also cause problems for Boeing's nearly 10,000 suppliers, which are present in all 50 U.S. states. Aside from the 33,000 union members among its nearly 150,000 U.S. employees, the company estimates its own annual contribution to the American economy at $79 billion, supporting 1.6 million jobs directly and indirectly.

Even if voters don't ratify the new treaty, a strike would not be guaranteed. A two-thirds majority of members would need to vote for a strike before a walkout could begin. Otherwise, the treaty would go into effect even if a majority of members were against it.

Boeing calls the deal with the International Association of Machinists (IAM) the most lucrative the company has ever reached with the union. CEO Kelly Ortberg, who has only been in office for a month, has promised to “reset our relationship with the union.”

Jon Holden, president of the IAM local who led the negotiations and supported the deal, now expects members to reject the contract and authorize a strike.

“People's reaction is that it's not good enough. Right now, I believe it will be rejected and our members will vote to strike,” Holden said in an interview with the Seattle Times, which the union confirmed to CNN.

Ortberg addressed union members in a statement Wednesday evening asking for support, but acknowledged that there was great anger at the grassroots level toward the company.

“I know the reaction to our tentative agreement with the IAM has been passionate,” he said. “I understand and respect that passion, but I ask you not to give up the opportunity to secure our shared future because of the frustrations of the past.”

If they vote for a strike, it would begin at 11:59 p.m. PT on Thursday or 2:59 a.m. ET on Friday. Voting will last until 6 p.m. PT on Thursday and the outcome of the vote should be known soon after.

Holden said the union would support its members if they voted to strike, but told them in a message Tuesday that union leadership was recommending that workers agree to the deal because it was the best that could be negotiated without a strike.

“We recommended acceptance because we cannot guarantee that we can achieve more with a strike,” he said in that message. “But that is your decision and a decision that we will protect and support no matter what happens. We have achieved everything we could in negotiations without a strike occurring. The members must take responsibility from now on.”

But the depth of workers' anger at Boeing, coupled with unusual union rules, will determine whether workers go on strike.

These rules require members to cast two different votes on Thursday. One is whether or not to ratify the agreement. The other is whether or not to authorize a strike.

The contract will be officially approved if more than 50% of the members vote for the tentative agreement. That would prevent a strike no matter how many workers vote for a strike. But even if a majority votes against the contract, workers will not strike unless at least two-thirds of the members have also voted for a strike. If just over a third of the members vote against a strike, the contract goes into effect regardless of the outcome of the ratification vote.

This happened in 2002, when 62% voted against ratifying an agreement, but only 61% voted for a strike. This was the last time such a split vote resulted in ratification of an agreement at Boeing. The last time the engineers went on strike was in 2008.

The agreement reached on Sunday would guarantee workers salary increases of at least 25 percent over the four-year term of the agreement, an inflation adjustment that could lead to even higher wage increases, lower co-payments for health insurance and higher company pension contributions.

It also includes the company's promise that its next commercial aircraft will be built in a unionized factory in Washington state.

The company had threatened to move production to a non-union plant over the years. Boeing completed its first non-union plant in 2009, just a year after the 2008 strike, and continues to build the 787 Dreamliner there to this day. Construction of the Dreamliner at a unionized plant in Washington stopped in 2021.