Boeing Workers Strike, Rejecting Deal Amid Company Troubles

Boeing employees started picketing outside the company's factories in Washington state early Friday after voting strongly to strike.

Thousands of machinists voted Thursday to turn down a proposed deal between the company and the union that would have greatly increased pay and benefits even though it didn't meet all union demands.

About 96 percent of members of the International Association of Machinists and Aerospace Workers District 751 voted for the strike — much more than the two-thirds needed to start the work stoppage.

Trump Ally's Racist Remarks Spark Republican Party Divide

"Boeing needs to stop breaking the law, needs to negotiate in good faith, and we'll be back at the table whenever we can get there to push forward on the issues our members say are important," Jon Holden, president of IAM District 751, told a room of machinists at the Seattle union hall.

The workers, many carrying signs about the stoppage, answered with loud cheers and chants of "strike, strike, strike."

The walkout is a hard hit for Boeing and could be the most disruptive challenge yet for a company that has spent much of this year dealing with one crisis after another.

Georgia Judge Dismisses Two Trump Election Case Charges

The strike risks messing up the aerospace giant's recovery from ongoing money and safety problems and could cost the cash-short company about $1 billion per week, analysts say. The union plays a key part in putting together some of the company's best-selling planes.

The most direct effect is on Boeing's assembly plants in Washington, especially in Everett and Renton. A long work stoppage could also affect Boeing suppliers and maybe shrink its share of the aerospace market.

Machinists in Seattle said the strike was a long time coming.

"We just want to be treated right and they're not doing it," said mechanic Charles Fromong, who has worked for Boeing for over 37 years. "So I guess we're going to get it done."

Boeing said early Friday that it would go back to negotiations.

"The message was clear that the tentative agreement we reached with IAM leadership wasn't acceptable to the members," the company said in a statement. "We're still committed to fixing our relationship with our employees and the union, and we're ready to get back to the table to reach a new agreement."

After a string of tense, long negotiating sessions over the last few weeks, the IAM and Boeing announced Sunday that they had reached a tentative four-year agreement, including a 25 percent pay increase over four years and better health and retirement benefits. Also important: If workers had voted to accept the deal before the current contract, Boeing promised to build its next new plane in Washington state, a key union demand. Both sides and investors had welcomed the deal.

The good feeling, however, didn't last long. On Monday, Holden told the Seattle Times that members would probably reject the deal. Opposition grew as workers held rallies and used social media to share their frustrations with the company's offer. A copy of a flier obtained by The Washington Post urged members to "VOTE TO REJECT BOEING'S BAD DEAL," passed around at many of the company's plants. Machinists were also angry about the removal of their yearly bonus program.

"We've got a lot of power — why waste that?" said Joe Philbin, a structures mechanic, outside the voting hall in Renton on Thursday. He's worked for the company for six months and wants to see the mandatory overtime rules change.

Several union members, who were being brought in from the nearby Renton plant on buses, said they were voting to reject the deal because they wanted to see bigger pay increases.

"Four years is not enough to make up for the last 16," Boeing worker Roger Ligrano said before he voted. He said he was voting to strike, partly, to give union members more time to understand a deal.

Harold Ruffalo, who has worked for Boeing for 28 years, said after the vote results were announced that too much corporate greed is affecting the company, and workers need more money to live as inflation hits paychecks.

"They need to take care of us," he said.

The Biden administration was watching the situation; acting Labor Secretary Julie Su has been in touch with both sides.

Boeing executives spent much of the week trying to save the deal, urging IAM members to put past complaints behind them.

"I hope you will choose the bright future ahead," Boeing CEO Kelly Ortberg said in message to employees on Wednesday.

"Working together, I know that we can get back on track," he continued. "But a strike would put our shared recovery at risk, further damaging trust with our customers and hurting our ability to determine our future together."

But workers rejected his call for unity.

"I want the company to be fair with us," said T E Sue, who has worked at Boeing for over 35 years and said it was the "worst contract" during his time. "We're the heart of the company."

Leading up to the strike deadline, analysts said they were worried about how long a strike would last. They said that many workers haven't forgotten previous rounds of negotiations in which Boeing pushed for give-backs — including the end of the traditional pension program — to keep plane production in Washington state.

Michael Bruno, Aviation Week Network's executive editor for business, said in previous rounds of negotiations Boeing threatened to move plane production to other states to get concessions from the union, which soured relations.

The last time IAM members struck was in 2008, a 57-day walkout that Moody's estimated cost Boeing about $1.5 billion a month. Boeing reopened negotiations on that contract twice, in 2011 and in 2013, and won significant give-backs from workers.

Boeing has struggled to recover from major safety, financial and legal setbacks that began in January when a door panel of a 737 Max jet blew out of the body in midair, leaving a big hole. Multiple investigations into the disaster uncovered serious problems in the company's manufacturing and safety oversight systems and led the Federal Aviation Administration to limit the number of 737 Max jets Boeing could build until it meets certain quality and safety goals.

In May, the Justice Department announced that Boeing had failed to meet the conditions of an agreement that protected Boeing from criminal prosecution in connection with a 2018 crash of a Boeing Max jet in Indonesia and a second one in 2019 in Ethiopia that killed 346 people. Boeing agreed to plead guilty to one count of criminal fraud in connection with the case — a settlement that still must be approved by a federal judge.

The company also has experienced major setbacks with its Starliner space program, which has been plagued by delays and cost overruns. The space capsule returned to Earth earlier this month, but without two astronauts it had carried to the International Space Station after NASA decided it was too risky to use the Boeing craft.

Ortberg, the former chief executive of Rockwell Collins, took over the top job last month, promising a new beginning.