Contract talks between leaders of the Boeing Co. and the union representing engineers and technical workers in the Puget Sound region are “productive,” but reaching a deal early isn’t likely.
“In my mind, we’re doing very well,” said Tom McCarty, president of the Society of Professional Engineers Employees in Aerospace (SPEEA). “I think we’ll get an agreement.”
With a contract that expires Oct. 6, SPEEA’s executive director, Ray Goforth, said expediting the process is possible but not probable. Union leaders have begun holding meetings with SPEEA’s 22,765 engineers and technical workers in the region to brief them on negotiations.
Boeing labor spokeswoman Bev Holland declined to discuss details of the company’s negotiations with SPEEA but characterized the talks as “productive” and “respectful.”
Holland’s response is in contrast to the company’s approach four years ago. In 2008, Boeing leaders laid out their proposals online and to journalists ahead of talks with union leaders, prompting pushback, particularly from the International Association of Machinists and Aerospace Workers (IAM), with claims that Boeing wasn’t bargaining. This year, with the Machinists contract already inked, Boeing and SPEEA representatives have been meeting regularly and plan to continue to do so to reach a deal before the contract expires Oct. 6.
Goforth and McCarty said there’s a level of candor between both parties that didn’t exist in 2008. They credited Boeing Commercial Airplanes President Jim Albaugh with changing the tone of discussions.
“It’s not like we suddenly got everything we wanted,” Goforth said. But they’re “more respectful in hearing our positions.”
When Boeing and SPEEA signed their labor contract in 2008, the company’s 787 Dreamliner already was behind schedule, due largely to outsourcing of both engineering and production work. Boeing leaders have moved back in-house more engineering work on the next version of plane, the 787-9. The company finally delivered the first 787-8 last September, after more than three years of delays.
“If the 787 business model had continued, Boeing was poised on the point of bankruptcy,” Goforth said. Union members “have turned the company around. This is the time to reward those employees.”
Both Boeing and the union look at salaries paid by other aerospace companies to help guide wage talks. McCarty emphasized that as a leading edge company, Boeing shouldn’t expect workers to take average salaries.
“Boeing wants to get rid of the defined pension benefit,” Goforth said.
In 2008, the aerospace company initially proposed doing away with the defined pension plan for new union members. Leaders at both unions opposed a change that would differentiate newer members from existing ones. They also thought Boeing’s plan of replacing pensions with a 401(k)-type retirement program wasn’t as valuable to members as the defined pension.
Goforth’s thoughts on pensions haven’t changed much in the past four years.
The switch to a 401(k)-type program would cut the average SPEEA member’s retirement savings by about 40 percent, he said. However, SPEEA is willing to look at alternatives to a pension if the amount of money they would receive is equal to the existing plan and not a reduction.
“It doesn’t seem fruitful to us that a company as successful as Boeing wants to cut its employees’ retirement benefits,” Goforth said.
The contract negotiated late last year between Boeing and the Machinists retains the existing pension plan for members of that union. Members of both unions can contribute to Boeing’s voluntary investment plan, which works similar to a 401(k).
With health costs on the rise, Boeing already has warned non-union employees of changes to their insurance plans beginning next year. And the Machinists agreed late last year to increase employee contributions while capping the maximum they pay out of pocket.
“We want to partner with the company to control health-care costs,” McCarty said.
SPEEA leaders have devised plans for working with Boeing on health care, such as offering incentives for employees to find medical billing mistakes. But Goforth said the union isn’t interested in seeing increases simply passed on to SPEEA members.
Although contract talks often boil down to three big-ticket items — wages, health care and retirement — there are several other points of concern for SPEEA. McCarty noted that the rate of accumulating vacation at Boeing hasn’t increased for as long as he can remember. And that rate, Goforth said, is slower than that for Airbus Americas workers. SPEEA leaders additionally will push for adding floating holidays and curbing required overtime.
Boeing’s decision to close its Wichita, Kan., site has prompted SPEEA to examine provisions about layoffs and worker retention, McCarty said.
“We want to have better tools,” he said.
Although Boeing has talked about longer term contracts in the past, particularly with the Machinists, the company and SPEEA are looking at a three-year contract, Goforth said.
The Society of Professional Engineering Employees in Aerospace represents engineers, technical workers and pilots at aerospace companies like Boeing, BAE, Spirit AeroSystems and Triumph. The union’s contracts for technical workers and engineers in the Puget Sound region expires Oct. 6.
SPEEA represents nearly 7.500 engineers and 4,000 technical workers in Everett and 22,765 Boeing workers in the Puget Sound area.
The union went on strike against Boeing for one day in 1993 and 40 days in 2000.
For more on SPEEA, visit www.speea.org.