The Boeing Strike: Day 32

Status: Two sides agreed to meet Wednesday to clarify information on key health-care and subcontracting issues. Both say they have no new proposals to offer.

Who: 32,500 members of the International Association of Machinists and Aerospace Workers in Seattle, Spokane, Portland and Wichita, Kan., with 23,500 members in Washington state. They represent one-third of Boeing's statewide work force of 71,707. Key issues: Wages, medical benefits and job security. Company offer: One-time lump-sum payments of 5 percent and 3 percent in the first and second years, and a 3 percent general wage increase in the third. Cost-of-living adjustments, estimated at 2 percent a year, are also included. Machinists, who make an average of $20.37 an hour, could expect $22.16 an hour at the end of three years and to collect more than $3,400 in lump-sum payments. Increased medical-benefits contributions, deductibles required for Boeing's biggest health plan.

By Stanley Holmes

Boeing's largest union, with 32,500 members, 23,500 of which are in the Puget Sound area, voted to strike after 12 days of failed negotiations on a new three-year contract.

"The issues are still on the table: job security, pension and medical benefits. We need changes in their proposal in those areas and your committee is ready and willing to start tonight if that company is willing to meet," said chief negotiator Bill Johnson, president of International Association of Machinists and Aerospace Workers District Lodge 751.

"Our job has just begun, we have a fight on our hands and I don't see anybody in this room willing to back down," Johnson said last night.

No talks were scheduled, although federal mediator Ben Youtsey could call the two sides together at any time.

"We're disappointed," said Paul Binder, a Boeing spokesman. "We still believe that our offer was fair and reasonable and reflects the realities of the current business environment."

The Machinists last walked out in 1989 for 48 days to protest mandatory overtime.

Boeing is said to be in a realtively good position to weather a short strike, but a long walk out could hurt.

Work on assembly lines stops during a strike, but work on planes awaiting finishing and flight testing could be completed by supervisors.

The company was planning to deliver 65 airplanes during the last three months of this year.

If deliveries are delayed, Boeing profits might suffer in the fourth quarter. But the impact more likely would come in the first quarter of next year due to delays on deliveries set for 1996.

Cai von Rumohr , an aerospace analyst with Cowen & Co. in Boston, said that because of slowed production due to a five-year downturn in the market for commercial aircraft, Boeing would be able to make up its schedule by April or May.

"Airlines aren't exactly clamoring to get new airplanes like they were in the 1989 boom," he said.

About 19,905, or 76 percent of 26,304 machinists who voted yesterday in Seattle, Wichita, Ks. and Portland voted to reject Boeing's offer.

Machinists will receive $100 a week strike benefit and some health insurance while on strike. The IAM strike fund totals $120 million.

The Machinists last walked out in 1989 for 48 days to protest mandatory overtime.

Key issues in the dispute are wages, medical benefits and job security. Boeing is proposing lower pay raises than offered in the past, an increase in the cost of medical benefits, and continued flexibility to subcontract work outside the company to reduce costs.

"Now, we're going to get you a good contract!" boomed Johnson as the votes were counted last night. "I can assure you we got the message to the Boeing Company across now."

Soon after the announcement, union members began stapling picket signs and mobilizing.

By 12:01 today, the rank and file had fanned out and set up pickets at 84 different Boeing gates in the Puget Sound region. Picket signs went up next to the company's corporate headquarters, where chairman Frank Shrontz presides over the aerospace giant.

The issue of Shrontz's multi-million dollar stock-option bonus has become a lightening rod for angry machinists. One of the more popular chants that spread through the factories prior to the strike was "Frank got the gold and we got the shaft."

Donna Barnett, a wire assembler in Renton, voted to strike because of the increased medical costs and for her growing sense of insecurity. Already, Boeing has shipped portions of her work to Foley, Ala., where wages are lower.

"There's always this underlying threat that they'll offload all of us," Barnett said. "If my job was offloaded to Mexico, I wouldn't have a job anyway. This time I get to choose."

The strike will extract a huge financial toll on Barnett and her daughter, who is a Boeing employee in Everett. The two likely will have share the same house to save money, Barnett said.

"She may have to move in with me," Barnett said. "But we'll make it."

The issue of job security appears to grow among the rank and file as their No. 1 source of frustration with the company.

"Boeing workers are angry that the company keeps winning orders for new airplanes while sending more and more jobs overseas," Gregory said. "Worker productivity is up 30 percent since 1990. Quality is way up, yet workers feel less secure than ever. Our members are tired of seeing their jobs destroyed and they want a contract that addresses job security."

Boeing strike response here

Boeing officials say their contract proposal is reasonable in the face of economic reality: defense spending is down and competition for commercial orders has increased.

Under the company's proposal, machinists making an average of $20.37 per hour in base wages, could expect $22.16 per hour at the end of three years, and collect more than $3,400 in lump-sum payments.

Since 1989, the union has lost about 16,500 members in the state, to 23,500. (There are also 1,000 machinists in the Portland area and 7,100 in Wichita, Kan.). Boeing has a total of 105,000 employees, down from 165,000 six years ago.

Boeing is said to be in a realtively good position to weather a short strike, but a long walk out could hurt.

Work on assembly lines stops during a strike, but work on planes awaiting finishing and flight testing could be completed by supervisors.

The company was planning to deliver 65 airplanes during the last three months of this year.

If deliveries are delayed, Boeing profits might suffer in the fourth quarter. But the impact more likely would come in the first quarter of next year due to delays on deliveries set for 1996.

Cai von Rumohr , an aerospace analyst with Cowen & Co. in Boston, said that because of slowed production due to a five-year downturn in the market for commercial aircraft, Boeing would be able to make up its schedule by April or May.

"Airlines aren't exactly clamoring to get new airplanes like they were in the 1989 boom," he said.

The Seattle Professional Engineering Employees Association (SPEEA), the second-largest union affiliated with Boeing, is watching the IAM negotiations because its contract expires Dec. 1.

The union, which represents about 20,500 engineers and technical workers,also has concerns about medical benefits.

Charles Bofferding, executive director, said he is sympathetic with IAM objections to a health-benefit change. He believes Boeing has "stepped over the line" and is penalizing families in the way it structured its medical proposal.

All Boeing union contracts carry no-strike clauses that require workers to cross other unions' picket lines.

SPEEA issued its members special "friends" cards to show support as they cross the lines. SPEEA said its members will not to perform any IAM work during a strike.