By Michelle Dunlop Herald Writer
Boeing Co. engineers and technical workers could be headed toward a strike even as federal regulators launch an investigation into mechanical issues with the company’s newest jet, the 787 Dreamliner.
On Friday, Boeing negotiators gave what they consider to be a complete and revised contract offer to leaders of the Society of Professional Engineering Employees in Aerospace, which represents 22,950 workers, about half of whom work in Everett.
Earlier in the day, the Federal Aviation Administration announced a comprehensive review of the design, manufacturing and assembly of the 787 — a rare undertaking that will require the help of Boeing engineers and technical workers who design and test the planes and see to problems on the assembly lines.
And Ray Goforth, SPEEA’s executive director, says a strike is “highly likely.”
Boeing’s latest proposal includes higher annual wage increases compared to previous offers; the last had annual wage-pool increases ranging from 3 percent to 4.5 percent.
For engineers, the new proposal includes salary-pool increases of 5 percent during the first two years of the contract and 4 percent in the last two years. The average salary for an engineer now is $110,000 per year. Technical workers would see salary-pool increases of 4 percent annually for the duration of the contract, with an additional lump sum equaling 1 percent of their salary in years one and two. The average technical worker makes $79,000 annually.
But the company is standing firm on a health-care proposal that requires employees to contribute more toward costs. And Boeing isn’t changing a proposed plan to switch incoming engineers and technical workers to a 401(k) retirement plan rather than enter them into the defined pension plan existing employees have.
For a lot of SPEEA members, Boeing’s traditional pension plan is the deciding factor in joining the company versus another aerospace firm, said Elaine Griffis, a 29-year Boeing employee and SPEEA member. Griffis participated in both of SPEEA’s previous strikes, a one-day walkout in 1993 and a 40-day work stoppage in 2000.
“It feels a lot like when we struck the last time,” she said.
Boeing is unwilling to continue offering a defined pension because the company needs a deal that “works both in the short and long term,” Mike Delaney, vice president of engineering for Boeing Commercial Airplanes, said during a conference call with reporters Friday.
Delaney has said the company would have to move work to other sites within Boeing if it can’t keep costs competitive in the Puget Sound region.
“We believe our offer is market-leading,” he said.
Boeing and SPEEA have been negotiating since April. The company and union resumed talks this week after a monthlong hiatus. SPEEA members voted to reject an offer from Boeing in October.
Boeing is to send an electronic version of the new offer by the end of the day Monday. The union will review the offer and decide whether to return to talks scheduled for Wednesday or to send it to members for a vote. If SPEEA negotiators decide to urge members to reject the offer, they’ll also ask them to give leaders the authority to call a strike.
That could make way for a walkout by early February. It’s uncertain how long the FAA’s review of the 787 will take, but any major changes would require engineering help. Delaney insisted Friday that the company has contingency plans, including bringing in engineers from other divisions within the company to assist in the review if necessary.
Analysts, however, say the 787 problems give SPEEA leverage in the contract talks. Scott Hamilton, of Leeham Co., noted that a SPEEA strike could bring the FAA review to a stop “or at the very least slow to a crawl.” And Richard Aboulafia, an analyst with the Teal Group, said the 787 review “strengthens SPEEA’s hand.”
Goforth wasn’t optimistic about Boeing seeing it that way. Boeing’s corporate officers have a “real delusional level of denial” about the role SPEEA members play in the company, he said in an interview Friday.
Reporter Michelle Dunlop: 425-339-3454 or firstname.lastname@example.org.