Boeing, Engineers Come To Terms Union Offered Tentative Contract After 38-Day Strike

The Spokane engineer who can recommend or rebuff a proposed contract with Boeing Inc. said Friday afternoon he was not impressed by the terms as he understood them.

But Dennis Davaz said narrow approval is likely when the 13,000 members of the Seattle Professional Engineering Employees Association vote on the pact Sunday.

The tentative three-year contract grants wage increases of at least 9 percent and cash bonuses of up to $2,500, while the company has dropped a demand that workers contribute toward their health insurance.

Davaz said terms are the first the union’s bargaining team thought were good enough to submit to members.

Whether the SPEEA council, on which he sits, will second adoption is another matter, he said.

During the last round of negotiations, the council refused to make a recommendation, he noted. The contract was approved anyway.

SPEEA Executive Director Charles Bofferding said the pending contract, hammered out after a 38-day walkout, earned the union new stature.

“All of us have a greater understanding of what is meant by the issue of `respect,”’ agreed Boeing Chairman Phil Condit at a Seattle news conference.

“One day I hope we can all look back on this as a turning point - a time when we more clearly recognized the importance of listening to and seeking to understand one another.”

The union’s engineering and technical units both received guaranteed pay increases, bonus money and no reduction of benefits - all of which were not included in Boeing’s three previous contract offers.

However, Davaz is among those who do not like the fact that the bonus money was tied to job retention and performance - $1,000 30 days after the workers come back, $500 after Boeing delivers 225 planes, and another $1,000 if Boeing meets its delivery goal of 491 aircraft by March 1, 2001.

Members of the Machinists union received better bonuses in the pact they accepted last year, he noted.

Martin Jonard, a Machinist union member leaving Boeing’s West Plains plant Friday, also questioned how well the engineers had done by comparison.

Boeing, he said, appeared to have satisfied the strikers by just moving around some of the money contained in earlier offers.

SPEEA represents 56 Spokane employees. Only one stayed in the plant, Davaz said.

With wind-chilled pickets pacing behind him, he said the strike solidified a union that questioned its own strength, while weakening allegiance to Boeing.

The company could have avoided a strike by making the offer proposed Friday much earlier, he said.

Condit said company executives would study the financial impact of the strike over the weekend, along with recovery plans. As the strike dragged on, Boeing’s share price dropped steadily and the company came under increasing pressure from airline customers impatient to receive new jets.

“Right now, our focus is to deliver every one of those 491 airplanes scheduled for delivery this year and to meet all our commitments to military customers,” he said.

Condit, himself an engineer and former SPEEA member, said he would create a task force to help improve relations between engineers and the company, though he added that new markets and competition may have changed the company’s culture, known for breeding strong loyalty and family-like connections.

“We want to build an attitude that says we are a team,” Condit said. “We’re not a family, we’re a team. We’re looking for performers from that team. It’s not an easy transition.”

Deliveries of commercial aircraft were down significantly in February and were practically nonexistent in March. Important Boeing customers such as American Airlines and United Airlines missed deliveries and had to make adjustments in maintenance and flight schedules.

The strike came at an awkward time for Boeing. The company was only beginning to recover from two abysmal years in 1997 and 1998, when its commercial aircraft division suffered heavy losses due to snarled production lines and delayed deliveries. The division came around in 1999, delivering a record 620 aircraft.

Wall Street analysts, who were initially split on how the strike would affect the company, agreed Friday that Boeing’s recovery would likely continue unabated. D.A. Davidson & Co. reversed an earlier downgrade of the stock on the news, while others reaffirmed positive ratings.

“I don’t see a long-term effect here,” said Joseph Campbell of Lehman Brothers. “They will pick up the pieces, put their shoulders to it and bring home every Year 2000 prediction that they’ve made.”

SPEEA, long in the shadow of the Machinists’ union, was helped by strong backing from other white-collar unions and the AFL-CIO - and by the booming high-tech industry in Seattle, where engineers and technicians easily could find work, often at higher pay.

In Spokane, Davaz saluted the support given by the United Steelworkers of America, who have been engaged in an 18-month job action against Kaiser Aluminum & Chemical Co.