The aerospace union that represents an estimated 1,000 workers on Boeing Co.’s dying C-17 cargo jet program in Long Beach, Calif., rejected a proposed contract because of cuts to pension and medical benefits, union officials announced Thursday.
“The proposal we received from the company is economically inferior and legally detrimental to this membership,” wrote bargaining committee officials for the United Auto Workers Local 148. “As a result, we have rejected the company’s proposal.”
The local union had originally sought a membership vote on Tuesday but decided to reject the offer outright in a sternly written letter to Boeing’s chief negotiator, Tom Easley. The union said the offer shortchanged workers in their final six months of work — when they’d be without a contract, as it now stands.
“It’s all in the company’s court right now. We are willing to go back to the table and work something out,” UAW Local 148 President Stan Klemchuk said.
A strike is not immediately in the picture because a five-year contract remains in place until February. The C-17 program ends in August, so a labor disruption in the six months after the current contract ends in February is speculative.
Boeing spokeswoman Tiffany Pitts stood by previous statements indicating that Boeing won’t budge in the talks.
Boeing’s Easley offered UAW’s bargaining committee, headed by Guy Coniglio, a “best and final” offer on April 11 that would have shorted aging aerospace workers at the factory in Long Beach on their pension and medical benefits as they approach the twin marks of 30 years of service and age 55.
Hitting the twin marks gives members full pension payouts and medical benefits, according to Klemchuk. The union is concerned, however, that roughly 280 of its members are less than a year short of 30 years of service and could get their pension cut by as much as 42 percent and greatly reduced medical benefits, had the contract been approved.
On Thursday, lawyers with UAW’s international headquarters in Detroit also chimed in with concern that the contract — if approved — could have potentially hurt C-17 workers out on medical leave by giving them 90-day layoff notices.
“You can’t change the playing field,” Klemchuk said.
In Boeing’s latest offer, the contract guaranteed a signing bonus of $4,000, 13 weeks of severance pay (which equates to roughly $21,000) and a bump in pension payments by $4 to $85 monthly per year of service. So, for instance, a worker with 30 years of service would receive a monthly pension payment of $2,550.
Local workers are still reeling from Boeing’s announcement earlier this year that the aerospace giant’s 777X commercial plane building program would not come to Southern California. Last September, Boeing officials announced the closure of the C-17 program, which was scheduled for the end of 2015. Last week, the company revised those plans to shutter the production line three months early.
The company has delivered 223 C-17s to the Air Force, with the last one having been delivered in October. An additional 39 C-17s have been sold to eight customers outside of the U.S. — Australia, Canada, India, Kuwait, Qatar, the United Arab Emirates, the United Kingdom and NATO.
The last of 17 C-17s will begin to roll off the production line beginning in October, which coincides with the first wave of layoffs to begin at the Long Beach factory, according to figures provided by Boeing to UAW Local 148.
Three hundred workers will be laid off by the end of the year, with an additional 250 early next year. The rest will come in successive months until August, when the C-17 line shuts down, the Boeing figures show.