Boeing Co.'s largest labor union called for a strike, setting up a battle that has the potential to derail the company's core commercial-airplanes unit at a time when customers are clamoring for fuel-efficient airplanes.
"The company had an opportunity to come to its employees with an offer that rewarded them for their hard work by offering a top-of-the-industry contract and some real job security, and it failed on all counts," said Mark Blondin, aerospace coordinator for the International Association of Machinists and Aerospace Workers.
Two-thirds of the members must vote against the proposal on Sept. 3 for a strike to occur. In 2005, the union struck for 28 days. In 2002, the union rejected the contract but failed to gain enough votes to strike.
The union leadership's condemnation of the proposed three-year contract, which would boost union members' wages by $34,000 on average over the period, came as a surprise to Boeing officials. They said they had hoped this year to deliver a contract that would avoid stirring up some of the tensions that had bedeviled previous negotiations.
A strike would be a severe blow to Boeing, which is running at full capacity to meet an unprecedented demand for more-fuel-efficient jetliners. A strike would also further delay development and deliveries of the 787 Dreamliner, which is already running roughly two years behind schedule with nearly 900 orders already on the books.
"The company had an opportunity to come to its employees with an offer that rewarded them for their hard work by offering a top-of-the-industry contract and some real job security, and it failed on all counts," said Mark Blondin, aerospace coordinator for the International Association of Machinists and Aerospace Workers.
Two-thirds of the members must vote against the proposal on Sept. 3 for a strike to occur. In 2005, the union struck for 28 days. In 2002, the union rejected the contract but failed to gain enough votes to strike.
The union leadership's condemnation of the proposed three-year contract, which would boost union members' wages by $34,000 on average over the period, came as a surprise to Boeing officials. They said they had hoped this year to deliver a contract that would avoid stirring up some of the tensions that had bedeviled previous negotiations.
A strike would be a severe blow to Boeing, which is running at full capacity to meet an unprecedented demand for more-fuel-efficient jetliners. A strike would also further delay development and deliveries of the 787 Dreamliner, which is already running roughly two years behind schedule with nearly 900 orders already on the books.
When Boeing officials delivered their so-called best and final offer Thursday, they said that the offer had been personally approved by Boeing Chairman and Chief Executive Jim McNerney, as well as the board of directors and Boeing Commercial Airplanes President Scott Carson.
Boeing officials have repeatedly said they want to avoid a strike, but they also insist that they won't do so at the expense of agreeing to a labor contract that hampers the company's ability to compete in what is increasingly a cutthroat sales environment.
Boeing spokesman Jim Proulx said the company was "extremely disappointed" with the union's recommendation. He said Boeing believes the company's offer "rewards employees for the company's success and allows us to remain competitive."
Under the contract that will expire next week, the average Boeing machinists earned about $27 an hour, or $56,000 a year before overtime.
Mr. Blondin said union members were expecting a raise of at least 13%, rather than the 11% that the company offered. He also said the company's offer to raise the monthly pension multiplier by $10 to $80 was insufficient for a company that was as flush as Boeing is right now.
He slammed Boeing for refusing to insert language into the contract that would have given the union greater authority over some tasks that Boeing took back during previous contracts. Because of those changes, contractors now deliver parts directly to the airplanes, rather than passing through a union receiving station.
Boeing has said that such freedom is a key part of its attempts to speed up production and that it doesn't intend to go backward.
During the final negotiations, Boeing officials did abandon several hot-button proposals related to pensions, health care and job security after union officials said their inclusion in a final offer would guarantee a strike. The company said it believed it had delivered a proposal that "adds up to the best contract in the aerospace industry."
Mr. Blondin said in an interview that the proposal "fell far short" of what the union believed the Chicago aerospace company should have offered, considering it is making record profit. The union says that during the past three years the company has racked up more than $13 billion in profit, a figure Boeing doesn't dispute.
"We think they gave the bare minimum that they had to in order to try and win over just enough members to avoid a strike," he said. "Well, our members are smarter than that, and they've let us know they are angry."
Mr. Blondin said union officials had also filed an unfair-labor-practices complaint against the company, alleging that the company improperly tried to influence talks by "bypassing our negotiators and going directly to the media and our employees with every offer."
Boeing has insisted it did nothing wrong by posting daily updates and video messages on its Web site, but Mr. Blondin said the union believes the move was "a blatant attempt" to undermine the union's ability to obtain the best agreement on behalf of its 26,800 members at Boeing.
"The company can blame its negotiating committee for this strike, which we believe will happen," he said. "They thought they were communicating with the employees, but they were just making them angry."
Mr. Blondin said union negotiators notified Boeing on Friday that the company's proposal was insufficient and offered to return to the bargaining table through the Labor Day weekend to reach an agreement. "Boeing told us they weren't interested," he said.
Mr. Proulx said the company doesn't intend to revise its offer. "We have made what is truly our best and truly our final offer," he said.
Boeing officials have repeatedly said they want to avoid a strike, but they also insist that they won't do so at the expense of agreeing to a labor contract that hampers the company's ability to compete in what is increasingly a cutthroat sales environment.
Boeing spokesman Jim Proulx said the company was "extremely disappointed" with the union's recommendation. He said Boeing believes the company's offer "rewards employees for the company's success and allows us to remain competitive."
Under the contract that will expire next week, the average Boeing machinists earned about $27 an hour, or $56,000 a year before overtime.
Mr. Blondin said union members were expecting a raise of at least 13%, rather than the 11% that the company offered. He also said the company's offer to raise the monthly pension multiplier by $10 to $80 was insufficient for a company that was as flush as Boeing is right now.
He slammed Boeing for refusing to insert language into the contract that would have given the union greater authority over some tasks that Boeing took back during previous contracts. Because of those changes, contractors now deliver parts directly to the airplanes, rather than passing through a union receiving station.
Boeing has said that such freedom is a key part of its attempts to speed up production and that it doesn't intend to go backward.
During the final negotiations, Boeing officials did abandon several hot-button proposals related to pensions, health care and job security after union officials said their inclusion in a final offer would guarantee a strike. The company said it believed it had delivered a proposal that "adds up to the best contract in the aerospace industry."
Mr. Blondin said in an interview that the proposal "fell far short" of what the union believed the Chicago aerospace company should have offered, considering it is making record profit. The union says that during the past three years the company has racked up more than $13 billion in profit, a figure Boeing doesn't dispute.
"We think they gave the bare minimum that they had to in order to try and win over just enough members to avoid a strike," he said. "Well, our members are smarter than that, and they've let us know they are angry."
Mr. Blondin said union officials had also filed an unfair-labor-practices complaint against the company, alleging that the company improperly tried to influence talks by "bypassing our negotiators and going directly to the media and our employees with every offer."
Boeing has insisted it did nothing wrong by posting daily updates and video messages on its Web site, but Mr. Blondin said the union believes the move was "a blatant attempt" to undermine the union's ability to obtain the best agreement on behalf of its 26,800 members at Boeing.
"The company can blame its negotiating committee for this strike, which we believe will happen," he said. "They thought they were communicating with the employees, but they were just making them angry."
Mr. Blondin said union negotiators notified Boeing on Friday that the company's proposal was insufficient and offered to return to the bargaining table through the Labor Day weekend to reach an agreement. "Boeing told us they weren't interested," he said.
Mr. Proulx said the company doesn't intend to revise its offer. "We have made what is truly our best and truly our final offer," he said.
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