February 22, 2014 in Business

Union leaders, Boeing agree on contract offer to keep company ‘competitive’

Tim Logan McClatchy-Tribune
 

ST. LOUIS – If Boeing Co. hopes to sell more of the military jets it builds in north St. Louis County, lowering the price tag of those jets would help. And a contract that will be voted on Sunday by about 2,500 of the company’s union Machinists here aims to do just that.

A tentative deal reached Wednesday between Boeing and District 837 of the International Association of Machinists would offer buyouts to veteran union workers, lower wages for future hires and lock in a schedule of wage increases and bonuses for the next 7 1/2 years.

It is designed to make the endangered assembly lines in St. Louis more “competitive” – as both company and union put it – and boost Boeing’s chances of winning more work here.

Boeing officials had little to say ahead of Sunday’s vote, issuing only a brief statement pointing out the offer’s “attractive” wage and benefit provisions and saying “it will better position Boeing St. Louis to compete for critical future work.”

Union leaders did not return calls seeking comment – they spent Thursday in Boeing’s huge factories in north St. Louis County and St. Charles, Mo., talking with workers about the deal – but a message on the District 837 website said the deal was unanimously endorsed by the 12-member bargaining committee.

“The offer is a collective and balanced approach to the issues of all our members and the business needs of the company,” wrote District 837 President Gordon King.

But to be sure, it knocks down a peg on the compensation levels at one of the region’s premier blue-collar employers.

The deal sets up a two-tier wage structure, like those in many recent auto industry contracts. Workers hired at Boeing after March 1 in many job classifications would see their wages top out at levels 8 percent to 49 percent below the top wages earned by people on the payroll today, though a person familiar with the contract said they’d still exceed national averages for aerospace manufacturing. And workers will shoulder more health insurance.

But those concessions, coupled with newly created buyout deals that could shrink Boeing’s workforce without layoffs, might be enough to help win more orders and thus prolong at least some of the jobs.

Union leaders, in their letters to members, warn that layoffs are likely by year’s end if the deal doesn’t go through. And their sense of urgency is highlighted by the quick pace of talks on this deal. Formal negotiations began just last week, and a deal was announced on Wednesday.

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