67% of voting Machinists reject Boeing offer

SEATTLE — Machinists union members on Wednesday overwhelmingly rejected a concession-filled Boeing Co. contract extension that would have ensured that the new 777X would be built in Everett. That rejection jeopardizes the future of at least some Puget Sound jetliner production.

Of the members of the International Association of Machinists and Aerospace Workers (IAM) who voted, 67 percent rejected the proposal, IAM officials said. The union did not release an actual ballot tally. The total membership employed by Boeing in the Northwest is about 32,000.

Voting ended at 6 p.m. Wednesday. Ballots from Everett, Renton, Frederickson and Portland union halls were bought to the District 751 headquarters here for tabulation.

Even as ballots were being sorted into piles of yes and no votes, it appeared that members had rejected the deal.

Shortly after the outcome was announced, Boeing issued a statement by Commercial Airplanes President and CEO Ray Conner: “We are very disappointed in the outcome of the union vote. … Without the terms of this contract extension, we’re left with no choice but to open the process competitively and pursue all options for the 777X.”

So the company will look to build the 777X elsewhere, more cheaply — if it can. But because the present contract doesn’t expire until 2016, nothing much in the factories here will change for several years.

“Boeing is going to put this out to bid, and that’s not to say that Washington isn’t going to be one of the bidders,” said Issaquah aerospace analyst Scott Hamilton. “It could even be a top bidder, given its highly trained workforce and developed infrastructure. But right now, Boeing is offering a sure thing, albeit at a high price for workers.”

And there’s no reason the union and the company can’t negotiate, and members vote on, a different deal.

But if Everett loses the 777, it would mean the loss of thousands of jobs. State leaders and business people fear it could be the beginning of a gradual decline in airplane assembly here.

District 751 Directing Business Representative Tom Wroblewski did not speak to reporters after the vote but issued a written statement: “We preserved something sacred by rejecting the Boeing proposal. We’ve held on to our pensions and that’s big. At a time when financial planners are talking about a ‘retirement crisis’ in America, we have preserved a tool that will help our members retire with more comfort and dignity.”

In Olympia, where lawmakers on Saturday passed Boeing-friendly legislation, including a tax-break extension, Gov. Jay Inslee said it was “a tough night for the state of Washington. The fact is we could have won this tonight without any competition. That didn’t happen.”

Following the vote count, Inslee said, he spoke briefly with Wroblewski, then Boeing government-relations executive Tim Keating.

In their conversation, Inslee said, Keating told him that the company would solicit proposals nationwide for the 777X final-assembly site.

Inslee said he asked if Washington would be in contention.

“Their answer was unequivocally yes,” he said.

“I’m in a competitive mood tonight,” the governor said. “The fact is this: If you want to build reliably with the highest quality in the world, on time, the state of Washington is the place to do it.”

All day, there was plenty of anecdotal evidence at polling places to suggest the membership would reject the contract. That point of view dominated the scene in Everett, where demonstrators banged drums, blew whistles and chanted, “Vote no!”

“There’s no chance it’ll pass,” said Julie Brumbaugh, who has worked at Boeing for 21 years. “Everyone seems pretty mad.”

Had members voted to accept the contract extension, Boeing had promised to build the new 777X in Everett and its carbon-fiber-composite wings somewhere in Washington. The contract expiration would have been extended from 2016 to 2024. Members would have each collected a $10,000 bonus.

They also would have seen major changes in benefits, including the end of a traditional pension and higher health-care costs, and very modest raises.

Those changes, regarded as take-backs by most, resulted in a huge turnout for the one-day vote. There was no voting by mail. At times the line of voters wrapped around the block at the District 751 union hall near Paine Field in Everett.

“I hope we send an overwhelming message,” Gant Diede said. He was beating an empty water jug — an improvised drum — with a baton.

Diede and other workers expressed distrust of Boeing’s statements about needing to cut labor costs to remain competitive and its promises to keep jobs in metro Puget Sound.

Steve Phelps, an electrician on the 787 line, said he didn’t believe Boeing’s threat to take 777X work elsewhere.

“Every time they outsource something, there are problems, and they ship it back to Everett,” the 36-year-old said.

Phelps joined Boeing two years ago in part because of its pension plan, something he didn’t want to give up, he said. “A 401(k) fluctuates with the market. Boeing works off a global economy, so I feel much safer with a pension plan.”

“I want my family taken care of after I retire or if something happens to me,” Phelps said.

“That’s what we’re voting for – the future,” said Wes Heard, a union steward, pointing to a union member holding a baby while in line to vote.

Behind him, a 777 in FedEx livery took flight from Paine Field.

While most workers struck a defiant tone, a handful said they were voting yes because they were worried about not having a job in the future.

Charles Mason, a 24-year-old worker on the 787 line, said he’d rather take the concessions and have a job than refuse to compromise but be out of work in a few years.

“It sucks either way,” he said. “It’s a hard decision to make.”

Mason held his 1-year-old son as he stood in line. “I’m the one who’d be losing my job if they move the 777X somewhere else,” he said. But he expected, correctly, that union members would reject the offer.

Reporter Jerry Cornfield contributed from Olympia. Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com.

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