Boeing Machinists Narrowly Approve End to Pensions

Boeing Machinists were nearly evenly divided on how to respond to the company's job blackmail. Photo: Jim Levitt.

Corporate America beat us, by a hair: on a 51 percent to 49 percent vote, Boeing’s concessionary contract was approved Friday.

It passed by about 600 votes, in a much smaller turnout than the vote back in November.

Less than 100 people were in the room for the vote-count announcement, in stark contrast to other times we’ve voted on a contract. The few hardy souls who came to the main Seattle hall of Machinists (IAM) District Lodge 751 seemed stunned when the results were read. Only one or two shouted anything, and within a minute the room was empty. It all ended with barely a whimper.

But the effects will be profound. Besides losing the defined-benefit pension (current employees will continue to accrue service time until September 2016, at which time the plan will be frozen; new hires will get only a 401(k)), we’ve lost collective bargaining, for all intents and purposes.

Two times now, in a three-year period, Boeing has come after us for concessions while we still had a year (in 2011) or three years (2013) left on our contract. Both times, the company has used the threat of moving the next generation of a given airplane program (737 in 2011, 777X in 2013) if we didn’t comply.

Because we are under contract, we had no strike weapon to provide leverage.

This new contract will be in place until 2024. Boeing will be looking to revamp at least a couple of other airplane programs before then… guaranteeing that the company will be back for another bite of the apple.

“Take It or We Leave” is the new modus operandi.

At this point 47 percent of the IAM workforce at Boeing is 50 or older. Many of those workers will retire in the next decade. By the time 2024 rolls around, a distinct majority of the union membership will have no experience of a “normal” contract negotiation, or of a strike.

The question is already being raised by members: What is the union for? What’s the point?

Mood Was Grim

The atmosphere in Everett, where 17,000 union members work, was very strange on voting day. Members needed an eligibility card, sent to them by mail, to obtain a ballot to vote on the contract. A huge number did not receive the card in time. They thus needed to obtain a “good standing” card, requiring a stop at the front desk in the union hall.

Problem: only two or three office employees were available at the Everett hall. There are only two or three computers for them to use to check the necessary rosters in any case.

Result: thousands of union members spent two hours or more waiting in line out in the cold outside the union hall. (It was tame by Midwest standards, but we specialize in a damp cold out here.) I’m astonished there wasn’t an explosion. Almost everyone just put up with it.

Very few signs, no chanting, no nothing. And it was impossible to “read” the mood.

When I got to the union headquarters in Seattle, the staff was as uncertain as I was. While we were waiting for the count in Everett to finish, we heard that the count in Auburn had favored passage. Auburn is where the Fabrication Division has its largest plant, with many older workers, including a large proportion of skilled machinists. These have traditionally been strong supporters of strikes.



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But what I heard was that many of these guys figured that even if we rejected the contract now, Boeing was going to crunch us on the pension in 2016. So why not take the $10,000 bonus, and the boost in the monthly pension payout to $95/month per year of service that goes into effect in September 2016?

Finally, at 10 pm, District Lodge President Tom Wroblewski came into the hall to announce the results. Union spokespeople took no questions after reading the very short statement.

The union didn’t release an official vote count, but the Seattle Times reported there were about 23,900 votes altogether. Turnout was lower than November in part because this time the International deliberately scheduled the vote when many members, especially long-timers, would still be away on holiday vacations.

Will ‘Boeing Effect’ Spread?

Boeing’s pressure and threats of the last month, aided by nearly all Washington state politicians and the media, clearly got to the membership. The public framework of the debate assumed that since workers elsewhere have been losing (pensions specifically, but wages as well), therefore Boeing workers should as well.

We were expected to sacrifice for the “greater good” of the region. Boeing’s extortion of the state, and of the union membership, was seen as business as usual. This was echoed in the statements of IAM International President Thomas Buffenbarger. Our efforts to defend our contract were completely undercut by the International.

Despite the verbiage in the most current edition of the IAM’s publication, touting the importance of defined-benefit pensions, there is no way the IAM will be able to protect pensions anywhere.

The spillover effect on the rest of organized labor is obvious. The IAM workforce at Boeing is the largest unit in the IAM, and one of the last industrial unions with a defined-benefit pension.

I expect the rest of corporate America to mimic Boeing’s tactics. Why wait until a contract is expiring? Just tell the union that it has to make concessions, or we’ll do x, y, or z—and it has to be done now, not when you will have the ability to strike.

Much of this echoes the concessionary bargaining that wrecked the auto workers and others. The difference here is that Boeing is immensely profitable.

In 2013 the company enjoyed record output, record profits, and a record stock price—up 80 percent. Plus, in November Washington state handed Boeing a package of tax breaks worth $8.7 billion, the largest any state has ever given a single corporation. Being told we had to sacrifice at the very same time Boeing handed out a $10 billion stock buyback and a 50 percent increase in the dividend (worth another $2 billion) only emphasized the unfairness of it all.

Oust Machinists President?

“Let’s put this vote behind us and go forward in solidarity,” wrote Wilson Ferguson, president of Local A (the largest local within District Lodge 751) and a strong proponent of a “no” vote both times, online. His statement was shared in a public Facebook group where members were discussing the deal. Ferguson wrote:

There is a lot of talk of pulling out of the International, that is a self defeating proposition. Our best strategy is to remove Buffy from office. That campaign starts today.

The loss of our pension is a big blow. Not only to us but to workers across the country. Maybe folks on the GUAV page [a “vote yes” Facebook page] are right that pensions are a thing of the past but it would have been nice to have had a good faith negotiation on the matter.

So while you may be happy that we accepted the deal, please dont confuse a victory with the loss of something that folks fought, bled and sometimes died to win.

Jim Levitt is 35-year Machinist at Boeing.


jane slaughter | 01/08/14

WIN Radio reports:
[Connie Kelliher]: “It’s really a corporate extortion plan by Boeing trying to make aerospace a race to the bottom. There was about seven to eight thousand members that didn’t vote on it and it was such a slim margin – 300 votes either way would have changed it. That means that about 37 1/2 percent of the members actually got to decide the fate for the next ten years which erases 78 years of collective bargaining history.”

IAM District 751 spokesperson Connie Kelliher. Many IAM District 751 Boeing machinists are very angry about the vote forced on them by their international union that destroyed defined benefit pensions, increased health care costs and in effect diminished wages. Some members have filed charges with the National Labor Relations Board and are demanding a re-vote when a true majority of IAM Boeing members would have a chance to cast ballots. Kelliher says due to members being away on holidays vacation about 25 percent of members didn’t vote on this concessionary contract proposal.

[Connie Kelliher 2]: “Members are very upset. There’s been a huge outcry since Friday’s vote was announced from the members calling for a re-vote. Our international president forced this vote under the guise of he wanted the members to have the final say on it. Well, if you want the members to have the final say, don’t pick a day where you know 25-30 percent of them are not available. A lot of people are very upset and have gone to the NLRB. They are passing around petitions that they want to call for a re-vote when truly a majority of the members could determine the fate. Our international president has said all along that he responds to hearing from the members. So right now the members are busy speaking up and letting him hear them.”

Kelliher says the contract Boeing forced on workers under threat of moving the production of the 777X airliner was corporate extortion that squeezed both the workers and $8.7 billion in tax concession from Washington state. And she says despite this being portrayed as giving up pensions and other concessions in return for guaranteed jobs there is no real iron-clad jobs guarantee for future Washington state union jobs from Boeing in the contract.

[Connie Kelliher 3]: “For a two-paragraph language giving us the airplane, the first sentence says we get the work and the next two paragraphs give them loopholes to move it. It not only gave up the defined benefit pension, it destroyed the health care, really. The premiums will go up three hundred percent by the end. Co-pays will double, all policies drop to ninety percent coverage on everything. In addition wage growth is cut by 75 percent from the current contract, which was only a two percent wage increase each year. It’ll now be one percent every other year, then it will go three years. And freezing our pension plan for the employees which is currently over-funded, Boeing put in language that once it’s frozen it can be merged with other plans and fund the executive plan, which is underfunded. ”

Meanwhile Boeing is making record profits, the CEO got a twenty percent raise last year and he has a pension that will pay him $265,000 a month when he retires and a supplemental pension on top of that. IAM International President Tom Buffenbarger was not available for an interview, but the international says the $8.7 billion in legislative incentives in Washington state are contingent on Boeing remaining in Puget Sound.

ira.woodward | 01/08/14

Very clear that everyone and her brother's sister is twisting the local's arm past breaking here.

And that she fights dirty.

But look-- the machinists' mood was 'impossible to read.' The old guys voted for the contract.

Industrial unions don't work anymore, if they ever did. This vote doesn't prove that, but it's true, and if you learn only that from this story, then i would elect you to be my local president.

Musicians once had a union-- of a kind. But i don't think poets ever did.

Matters of the heart do matter to a true trade unionist, but solidarity, like true love, is forever.

ira.woodward | 01/08/14

Sounds like the crowd was experiencing a dissociative state. Hence hard to read the mood.

What is the point of the union, exactly?

International isn't just the US and parts of Canada. I heard.

But that's petty. There's so many deep criticisms one could actually sink one's teeth into. Or get up to one's elbows in, or run with, take off and fly.

Take my word-- the only hang time those execs are getting is the sub-prime time-share they got at discount on their castle in the sky.

The petty and insignificant truth is the foundation hewn into sturdy hopes and dreams. Grammatically obtuse to obscure the pain-- no one wants to feel it anymore.

Rise up, or not. We're all going to hell in that handbasket anyway. That's what they call the thing under a hot air balloon, right?

Or maybe it's something else...

cameron | 01/07/14

Appreciate your response to my criticism. Your point about accurate assessment is well taken. My point is that such an assessment should include the positives as well as the negatives. All pieces I have read from the corporate press happily report the vote as a disastrous defeat for the struggle of workers, and surprisingly so do pieces from the progressive press. The extraordinary resistance demonstrated by a sizable portion of your co-workers should not replace the formal political realities but demands a place within the larger reality of the bottom up organizing future progress depends on. Ideally any analysis of the political defeat must also include an analysis of the high level of resistance your co-workers were compelled to adopt.

wa7uhr | 01/07/14

All that left to do "is bury the dead meat".

cameron | 01/06/14

The Labor Notes report on the contract vote (1.6.14), like most reports in the corporate press, one-sidedly portrays it as total defeat for workers. What is being missed here is the amazing response by most senior boeing workers who voted 'no' in the face of an aggressive campaign by the company, the state and the IAM international to force them to vote yes. Falling short by only 300 votes out of around 24,000 is a major demonstration that sizeable numbers of workers have what it takes to topple capitalist rule. Rather than painting a bleak picture as the LN article does, these workers should be extolled in a major way.

Jim Levitt | 01/07/14

If you read the article carefully, Cameron, you'll note that I expressed both surprise and dismay upon hearing that the count from Auburn favored acceptance of the offer. The Auburn plant, where I have worked on three separate stints during my 35 years at Boeing, is home to a large contingent of "machinist machinists," not to be confused with the assembly mechanics and other production workers. These guys (overwhelmingly male) have traditionally been among the most militant during contract negotiations and strikes. They are also predominantly older, and thus much more likely to have a personal stake in defending the defined benefit pension. If there was any segment of the union membership I expected to reject this second proposal quite handily, it was the Auburn crew. This was not as clear-cut a generational split as one would think. There was a fair number of younger workers who recognized the dangers inherent in accepting this contract.

We have some important problems to think about, coming out of this episode. How do we respond, when the "normal" contract cycle no longer has any meaning? How can the union (the IAM here, but this is broader) combat the propaganda barrage telling us that we need to give up hard-won gains, because other workers have lost them before us? How do we pull the membership back together, at a time when many are talking of "going agency" or otherwise withdrawing their support?

The rejection of the contract in November, by a 2-1 vote, was a very proud moment. That nearly 50% (it may well have been a slim majority, but for the voter suppression engineered by the International, which insisted on holding the vote when thousands of members would not be present)still were willing to resist after six weeks of pressure, including from those we expected would lead the fight, is encouraging.

But before anything else, we have to recognize that this was a defeat, and not a small one. All politics starts from an accurate assessment of what is.