In an effort to end the strike that is threatening to impact its operations, Boeing has significantly raised its contract offer to the Machinists union. The proposal, delivered Monday morning, aims to resolve the work stoppage and bring workers back to the assembly line as soon as possible.
Boeing’s chief negotiator, Mike Fitzsimmons, described the offer as the largest the company has ever presented to any union, saying, “We hope it addresses the concerns of both the union and the members, and we hope they vote it soon.”
Aiming for a Quick Resolution
The new offer arrives as union members are set to miss their first full paycheck and will lose company health coverage by the end of the month if the strike continues. The urgency to resolve the strike is clear, with Boeing’s new CEO Kelly Ortberg playing an active role in shaping the deal. Boeing vice president Peter Johnson emphasized the importance of ending the strike quickly to resume production.
“The sooner we get those people back, shoulder-to-shoulder with us, working through building the airplanes and getting through the problems we have, the better off we all are,” Johnson said.
Key Changes in the Offer
Boeing’s revised offer includes a significant pay raise of 30% over four years, up from the 25% in the previous proposal that was rejected by the union. This increase begins with an immediate 12% raise, followed by 6% increases in each of the following three years. The offer also restores the annual bonus, which had been removed in the earlier proposal, adding a variable pay increase worth around 4% each year.
In addition, the signing bonus has been doubled to $6,000 for each Machinist upon ratification of the contract. However, the new offer does not include a return to the traditional defined-benefit pension, a key demand for many Machinists. Instead, Boeing has increased its 401(k) contributions, now offering up to 12% of base pay, with a 4% automatic contribution and a matching contribution up to 8% of employee contributions.
Response to Union Rejection
The new contract proposal follows the union’s rejection of Boeing’s previous offer, signaling a disconnect between what Boeing believed it had achieved and what the union members expected. “We’ve listened. We’ve heard the feedback from multiple sources, and we’re making our best effort to balance the realities we have in our business today with promoting the team that builds these magnificent airplanes,” Johnson said.
Fitzsimmons confirmed that this new offer represents Boeing’s “best and final” proposal, a status that was not applied to the initial offer.
According to the constitution of the International Association of Machinists, the union is required to put Boeing’s new offer to a vote. This vote is expected to take place later this week. Boeing has set a deadline of 11:59 p.m. Pacific time this Friday for ratification, and the outcome will determine whether the strike continues or ends.
Boeing remains committed to building its next new jet in the Puget Sound region, and all other terms of the previous offer remain unchanged.
As the Machinists union prepares to vote on Boeing’s substantially improved offer, the company hopes the new terms, including higher wages and bonuses, will resolve the work stoppage. With negotiations in full swing, both sides are focused on finding a resolution that will get workers back to building planes and ensure the company can move forward with its production goals.
