Engineers and technical professionals working for Boeing in the greater Seattle area soundly rejected a contract proposal from the company. With a 96 percent "no" vote, members of the Society of Professional Engineering Employees in Aerospace (SPEEA) sent a clear message to Boeing: We won't let our labor be undervalued while the company makes billions a year in profit.
SPEEA spokesperson Bill Dugovich said the vote "shows that our members are not going to stand for being treated like second-class citizens when the executives are getting double-digit raises and bonuses equivalent to a year's salary."
As the Seattle Times reported, when the vote outcome was announced at the union's headquarters on October 1, the assembled crowd took up the chant, "Chicago, can you hear us now?!" Boeing is now based in Chicago.
At stake for the 23,000 members of SPEEA are such issues as pension and salary increases, health care contributions and a two-tiered retirement plan.
Boeing's initial contract offering was a slap in the face to the membership. The four-year contract proposed a mere 3 percent raise in salaries each year for engineers. Given the rate of inflation last year, such a paltry salary increase could mean engineers barely hold the line in terms of real earnings. For technical professionals, the proposed salary increase was only 2 percent a year.
Boeing's proposal would also more than double employees' average contributions for health care premiums, deductibles and co-pays.
Furthermore, the offer specified that new hires starting in 2013 would move to a 401(k) retirement plan instead of the traditional defined-benefit pension plan that current employees have. Such two-tiered plans are becoming more and more common as companies seek to cut costs by dodging responsibility to fund their employees' retirement.
Besides subjecting workers' retirement funds to the chaotic whims of the market, these two-tiered plans create divisions within the union, and thereby weaken workers' bargaining position in future negotiations. As Boeing management themselves said last year, restraining the pensions for new hires is "the single most important thing on our agenda."
Perhaps the most disturbing aspect of Boeing's proposal was language that suggested management would have authority to make administrative changes to the contract at their behest. For example, as the Seattle Times noted, Boeing could "change what procedures are covered by a medical plan or even eliminate retiree benefits."
"A lot of people are upset," Shannon Qualls, a technical designer with 23 years of experience, told the Seattle Times. "The contract is insulting. The compensation package is totally unacceptable. It's less than the rate of inflation. It's sad to see, when Boeing is doing so well with orders and the money they are making."
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IT ONLY takes a cursory glance at the numbers to understand Qualls' frustration. Boeing made $4 billion in profits just in 2011 and currently has a backlog of orders for some 4,000 planes, which amounts to more than $355 billion in future business. The company has also received billions of dollars in subsidies from Washington state alone, largely in the form of tax breaks. And last year, CEO James McNerney received almost $23 million in total compensation.
Given these eye-popping numbers, it's safe to assume that Boeing could find the money in their coffers to fund a fair contract. Instead, the company came to the negotiating table with nothing less than open contempt for the union.
"These are the most offensive and disrespectful negotiations I've ever been part of," SPEEA Executive Director Ray Goforth told the Seattle Times. "It appears they don't have any intention to reach a deal."
As if to prove the point, Boeing has deployed heavy-handed intimidation tactics against SPEEA members, videotaping solidarity marches while simultaneously confiscating cameras belonging to SPEEA members and deleting their photographs of the actions. Such harassment has prompted SPEEA to file two unfair labor practice charges against Boeing.
In their arrogance, Boeing officials have underestimated the degree to which union members support the union's negotiating team–and how concerned the rank and file is about what Boeing has offered.
So far, the company's strategy has backfired. Boeing expected union negotiators to return to the table with various amendments to Boeing's initial offer. Instead, SPEEA leaders decided to put the contract up for a vote and to recommend that members vote it down. The subsequent 96 percent vote to reject demonstrated in no uncertain terms what the engineers and technical professionals think of the company shortchanging them.
On the eve of the vote, Boeing's vice president of engineering Michael Delaney defiantly argued that the company would be "forced" to move engineering work outside the Puget Sound region if SPEEA took too hard a line. Given Boeing's recent establishment of one of its newest facilities in the union-hostile South, such a threat can't be ignored.
However, designing and building aircraft is no easy feat. It takes the work of highly skilled and trained professionals to create safe and reliable aircraft. This is a reality that the union can and should leverage. Unions are positioned to fight for ongoing, on-the-job training for their membership. This can help ensure that unionized workplaces remain strongholds of well-qualified labor capable of producing the highest quality products.
Furthermore, by safeguarding workers' well-being outside of the job (through protecting health care coverage for employees and their families, for example), unions enable employees to focus more successfully on the important work they are performing while on the job.
The NFL's recent lockout of unionized referees provides a useful lesson in this respect. The start of the football season was marred by bumbled calls, egregious hits and near-misses, as under-trained, nonunionized refs failed to protect players' safety and maintain control on the field.
Anyone sympathetic to Delaney's anti-union arguments should ask themselves this: Would you be willing to strap yourself or a loved one to 400 tons of machinery, elevate yourself seven miles above the earth's surface, and shoot across the sky at 600 miles per hour, all with the hopes of landing safely hundreds if not thousands of miles away, if that machine wasn't designed, built and operated by the most skilled and attentive labor possible?
I know I wouldn't.
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THE OVERWHELMING "no" vote is already paying dividends for the union. One day after ballot tallies were announced, Boeing made three immediate concessions with respect to its health care package.
While this is a positive turn of events for SPEEA, much more pressure will be needed to win a decent contract. SPEEA won a tactical victory by pushing the contract through to an early vote, thereby revealing to the membership just how little Boeing thinks of their work. However, relying on tactical maneuvers will only take the struggle so far. Ultimately, the union's willingness to mobilize the rank and file will be the key to winning a successful contract.
Many believe this will be difficult to do, arguing that the white-collar membership of the union is focused more on "professional identity" and their "place in the industry," overshadowing the class dynamics of their employment at Boeing.
While it is true that SPEEA has historically approached negotiations in a non-aggressive manner, there are exceptions to this rule. Most notably, the union went on a 40-day strike in 2000. This action won them a three-year contract that included a 5 percent raise the first year, followed by a 4 percent raise each of the following two years, and a 25 percent increase in Boeing's monthly contributions to members' pensions.
This time around, SPEEA has organized several marches through factories in the Puget Sound area. And following the no vote last week, Goforth laid out a plan to escalate the struggle against Boeing if more of the union's demands aren't met, including implementation of a work-to-rule policy to slow production.
A strike is not off the table either. The current contract expired October 6, but remains in effect until November 25, the earliest SPEEA could take legal strike action.
It will be important for the rank and file to take the lead in preparing for such actions. Despite Goforth's strong talk, he has already demonstrated some willingness to collaborate with management, including sending a letter to a top Boeing official calling for a "face-saving way forward for both sides."
Along with machinists and non-unionized professional staff at Boeing, engineers and technical workers have made Boeing the enormously profitable company that it is today. Through the organization of the membership, SPEEA has an opportunity to gain a larger slice of the pie that they themselves created.
And this is a truth that is not lost on many. As the union itself has framed the contract battle, "No nerds, no birds."