IAM members in the State of Washington voted on January 3 to eliminate defined benefits pensions for new hires and freeze pensions for current employees; in return, their employer–Boeing–promised to build its new 777X airplane in the state.
Members of IAM District 751 voted in January for the second time on an offer by Boeing to extend their collective bargaining agreement until 2024. The current agreement is set to expire in 2016.
Boeing’s offer included steep concessions such as the elimination and freezing of pensions, higher health care costs, and a wage freeze for new hires. District 751 leaders, who unanimously opposed the offer, said that because of the offer’s concessions, workers take home pay would decline over the next ten years and there would be no opportunity to negotiate new wage increases.
“We recommended that our members reject the offer because we felt that the cost was too high in terms of our lost pensions and the thousands of dollars in additional health care costs we’ll have to pay,” said Tom Wroblewski, District 751 president.
But by a vote of 51 percent to 49 percent members ratified the new agreement.
After the results were announced, Wroblewski said that the union’s leadership team would join with all union members “to pull together to make (the 777X) program successful.”
Some District 751 members were clearly upset by the results.
The Seattle Times reports that, “Inside the union hall, the announcement of the contract’s acceptance was greeted with shock and one cry of ‘bullshit’.”
Jim Levitt, a 35-year Boeing employee, told NPR that the yes vote was a “a setback for not only Boeing workers but American workers as a whole.”
Bryan Corliss, a District 751 spokesperson, told the Times that for many members, the results were difficult to accept because they went on strike in 2005 and 2008 to protect their pension and won.
District 751 members, who in November rejected a similar offer from Boeing by a vote of two-to-one, faced heavy pressure to reverse themselves and accept the company’s offer.
International IAM President Tom Buffenberger stepped into support a revote.
After the local leadership rejected Boeing’s second offer, Buffenberger ordered the local to vote on the offer.
Buffenberger seemed to be pleased with outcome.
“After weeks of robust debate, IAM members at Boeing made decisions they felt were in the best interest of their careers,” said Buffenberger. “Despite individual differences, I believe this vote preserves thousands of good-paying IAM jobs, while assuring the success of the 777X program.”
Buffenberger’s support for the yes vote seemed at odds with his general support for defined benefits pensions, which he said at an October congressional hearing have “served millions of Americans well and kept our nation’s seniors out of poverty.”
An IAM media release about his testimony said that, “the majority of Americans are too financially stressed to save for retirement” and backed up this statement by referring to a Wells Fargo survey on middle class retirement that found that “barely half of survey participants felt they would be able to save enough to actually retire. A stunning 37 percent said they would have to work until they were too ill or died.”
Buffenberger was joined in his support for a yes vote by Washington’s political and business leaders. The Associated Press reports that the contract vote, “drew unusual pleas from politicians who said the deal was necessary to support the area’s economic future.”
Among those urging Boeing workers to sacrifice their pensions for the good of “the area’s economic future” was Washington Gov. Jay Inslee, who after the vote, issued a statement saying, “Tonight, Washington state secured its future as the aerospace capital of the world.”
In November, Gov. Inslee, a Democrat, and the state legislature, led by Democrats in the House and a coalition of Republicans and Democrats in the Senate, gave Boeing an $8.7 billion tax break, which according to the Washington Post is “the largest corporate tax break any state has ever given to a single company,” to keep 777X production in Washington.
As for Boeing, it played hardball to win a yes vote.
Before District 751 members rejected the company’s first offer in November, Boeing said that it would consider moving 777X production to another state if workers rejected the company’s concession demands.
When they voted no, Boeing announced that it had begun seeking proposals from other potential sites for 777X production.
It didn’t take long before the company started receiving proposals from cities such as St. Louis interested in the project, and this interest was reported extensively by the media.
The pressure to vote yes seemed to have its desired effect.