On Tuesday, October 8, as the strike by 33,000 Boeing workers entered its fourth week, the company withdrew the salary proposal put forward in the latest round of negotiations and stated that there were no plans for further talks.
According to Reuters, on Monday, October 7, Boeing, the International Association of Machinists and Aerospace Workers (IAM), and federal mediators started the most recent round of labor negotiations. However, after two days of discussions, no agreement was reached, leading to another deadlock in the negotiations.
“Unfortunately, the union did not seriously consider our proposal,” said Stephanie Pope, Chief Operating Officer of Boeing Commercial Airplanes, in a letter to employees. “Further negotiations at this point are meaningless, as our proposal has been withdrawn.”
Pope pointed out that Boeing has been taking measures to preserve cash. The aircraft manufacturer is considering raising billions of dollars through the sale of stocks and securities.
The factories producing Boeing’s best-selling 737 MAX, 767, and 777 aircraft have been shut down, forcing thousands of employees to take temporary leave.
S&P Global has placed Boeing on a negative credit watch list, which could result in further downgrades to its investment credit.
Workers at Boeing’s West Coast factories rejected the company’s initial labor proposal of a 25% wage increase over four years and began the strike on September 13.
Meanwhile, IAM proposed in the negotiations that workers be given a 40% wage increase over four years and the reinstatement of fixed benefit retirement plans removed from contracts ten years ago.
In the previous month’s negotiations, Boeing presented a “best and final” improvement package agreeing to a 30% wage increase for these workers and the reinstatement of performance bonuses. However, the union responded that after surveying its members, the conditions offered by Boeing could not meet their demands.
“We negotiated in good faith and improved the proposal,” Pope said regarding the two consecutive days of negotiations this week. “We worked to reach a compromise, including improving base wages and retirement benefits.”
However, IAM stated in a release that Boeing still insisted on the “non-negotiable proposal” presented last month.
The statement further mentioned: “They refused to propose any wage increases, accrual of vacation/sick leave, promotions, or overpaying employees through retirement accounts by $401,000. They also refused to reinstate fixed benefit pension plans.”