The full-membership vote on the revised contract offer from Boeing Co. (NYSE: BA) is being forced on union local 751 by its parent organization, the International Association of Machinists and Aerospace Worker (IAM), and the local is not the least bit happy about the intrusion. The local union had rejected the revised offer from Boeing without submitting the offer for a membership vote, saying the contract was essentially the same as the original Boeing offer that was rejected by a two-to-one margin in an earlier vote. The international-mandated voting will take place on January 3.

The local union has posted on its website a side-by-side analysis of the two contract versions, noting that the only changes are an additional $5,000 lump sum bonus payable in January 2020, a better dental benefit and an extension of work on the 737 MAX through 2014.

Boeing has said that it will build its new 777X and wing assembly plants outside Washington state unless the union agrees to its revised contract offer. According to the union, Boeing does not really guarantee workers’ jobs, so why should these workers “trade away our wages and benefits for a meaningless guarantee?”

The local also notes that health care premiums will triple and that average annual wage increases from 2016 to 2024 will be just 0.5%, or $0.15 an hour for a machinist currently earning $30.00 an hour.

Boeing did withdraw its original proposal to eliminate the progressive wage schedule but made no change to the pay rate offer for new hires. According to Local 751, “If approved, hire in rates will change only one time in 32 years. By the end of the proposed agreement, the bottom three labor grades’ hire in rate would be at the state minimum wage (since it has a [cost of living allowance] escalator and increases each year).”

Regarding the pension issue, Local 751 tells its members:

If you are at maximum pay today, the new retirement savings plan will provide two-thirds less than the current pension… You will have to work longer, retire with less and carefully plan how long you may live.

The strongest objections to Boeing’s proposal were raised against the company’s plan to move from a defined benefits pension plan to a defined contribution plan. Although the union local’s website avoids the issue, this part of the contract offer divides union members against each other, with senior employees wanting to protect their current pension plan and younger workers wanting to protect their jobs.

As we noted in our discussion of this dispute published yesterday, Boeing cannot lose no matter which way the union vote goes. The company has already succeeded in splitting the local from its international, and it is driving a wedge between the older and younger workers in the local as well. The only leverage the union has is that its experienced workers have value to Boeing that cannot be easily replaced if the company relocates out of Washington state. That is a mighty slim thread on which to hang your future.

Boeing has essentially broken its union no matter how the January vote turns out. It has done so because it can; there is no domestic competition for Boeing’s commercial aircraft, and it has carved out its own niche in military planes as well, and there is no political support for maintaining unions. Sad, perhaps, but certainly true.

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