(Bloomberg) — Boeing Co. and its largest union said they hammered out a deal to potentially avoid a strike that would cripple its airplane manufacturing.
The IAM 751 union and the company said the offer includes a wage increase of 25% over four years and a commitment to build Boeing’s next plane in the Seattle area.
The breakthrough came following a marathon bargaining session with a strike vote looming after the current contract expires at midnight Sept. 12. It marks a significant victory for new Boeing Chief Executive Officer Kelly Ortberg, who’s signaled he wants to reset long-contentious labor relations at the planemaker.
But it’s too soon to know if Boeing’s factory workers will support the measure — or buck their leadership. Anti-management sentiment is running high, particularly among workers who were pressured into forgoing pensions a decade ago.
“The contract offer provides the largest-ever general wage increase, lower medical cost share to make health care more affordable, greater company contributions toward your retirement, and improvements for a better work-life balance,” Commercial Airplanes President and CEO Stephanie Pope said in a video message to employees.
Officials from Boeing and the International Association of Machinists and Aerospace Workers have been holed up in a Seattle hotel for nearly a month trying to find middle ground on wages, retirement benefits, job security, health care and other issues. The talks are the first full-scale negotiations in 16 years between the company and the union local representing 33,000 mechanics and factory workers in Washington and Oregon.
If workers balk at the company’s offer, Boeing faces a walkout that could shut down its Puget Sound factories, jeopardizing efforts to boost jetliner output following a near-catastrophe that exposed lax quality controls and manufacturing shortfalls.
–With assistance from Danny Lee.
(Updates with wage offer, comment from Boeing executive.)
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