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Boeing Nears Engineer Strike Vote as Union Balks at Terms

Boeing Co. (BA)’s engineers face an “increasingly likely” request for strike authorization from the union after a wage plan offered by the planemaker today fell short of expectations, a labor leader said.

“They’ve included a couple of poison pills in this proposal, to eliminate the pension and cut the salary growth, that make it difficult for me to see a path to an agreement,” Ray Goforth, executive director of the Society of Professional Engineering Employees in Aerospace, or Speea, said in an interview today. “It’s increasingly likely the negotiating team will seek strike authorization soon.”

The current contract for the 23,000 engineers and technical workers, largely in the Seattle area where Boeing’s commercial headquarters are located, expired Oct. 6 and was extended through Nov. 25 after the union rejected Boeing’s first offer.

Work will continue as usual after next week even without a new deal, Goforth said, though he expects the number of engineers refusing voluntary overtime in protest to “greatly expand.” Boeing, which is boosting production 60 percent in the four years through 2014, hasn’t seen any impact from engineers’ so-called work-to-rule efforts, Doug Alder, a spokesman for Boeing in Seattle, said today.

‘Initial Proposal’

Boeing today offered raises of between 3 percent and 4.5 percent a year over a four-year contract, compared with the first offer of 2.5 percent to 3.5 percent a year, according to an emailed message the planemaker sent to employees after today’s meeting with Speea. The last wage accord provided 5 percent a year, and Speea had asked to either extend that or lift it to 7.5 percent this time.

“The offers are significantly increased from our initial proposal and we feel very good about it,” Alder said in an interview. “We’ve said all along it’s going to take movement from both sides, and we’ve moved significantly. Today’s proposals prove that.”

The company and union plan to meet again tomorrow. Even if Speea does ask its members for authorization to strike, negotiations would “almost certainly” continue before any action were taken, Goforth said.

Boeing’s engineers not only design new planes, they inspect those being built and sign off on the work before aircraft are delivered. That means any labor action would interrupt work flow during the record production increase.

Chicago-based Boeing has warned that engineering costs have become too expensive in Seattle and that some development work on future jets may be done at less-expensive sites elsewhere. Unions have countered that their members deserve raises as they boost output to work off a backlog of 4,234 jets valued at $307 billion and as the company plans to increase payouts to shareholders after amassing $11 billion in cash.

To contact the reporter on this story: Susanna Ray in Seattle at sray7@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net

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