Boeing, SPEEA Exchange Differing Views In Contract Talks

As talks between Boeing and SPEEA continue, the divergence both sides have over their respective offer and demands are showing what could emerge to be a deepening rift that could end up with a second strike in as many months for the US aerospace giant.

“The company’s own data shows salaries are behind market,” said SPEEA Executive Director and Chief Spokesperson Ray Goforth. “Boeing cannot hire enough people. That problem would evaporate if they raised salaries to market leading levels.”

Boeing’s VP of Human Resources, Doug Kight acknowledged that “there is much ground to cover” before a formal contract can be offered. It is believed a best and final offer is due to be tabled this week to SPEEA, who will them in turn send out mail ballots to its members to vote on accepting or rejecting the deal.

“Our overall compensation philosophy is to provide salaries that are competitive within the market for employees with the wide range of skills the company needs, thus attracting and retaining talented employees.

Our initial offer includes salary adjustment funds – for both the Professional and Technical units – in each year of the contract. Salaries are adjusted after employees go through the annual performance management process,” says Kight.

Image courtesy of Boeing

With IAM union staff still returning to production lines after their two month strike, Boeing has already been hit with the news that the 787 Dreamliner would now not be making its first flight by Dec 31st, 2008 and that the 737 line has been discovered to have non-conforming nutplates that require retrofits and replacement parts.

Boeing is gearing up production to stabilise to pre-strike levels in January 2009 - it is also thought that any rejection of the contract by SPEEA would result in their industrial action taking place around the same time, damaging prospects for Boeing to complete missed deliveries from 2008 and take a hit for deliveries in 2009 too.

Some observers note that Boeing did not relent in the wake of IAM pressure during their walkout and see the same stance being taken with SPEEA should they elect to strike too.

Boeing CEO Jim McNerney made clear that “none of us want to go through this again next time around.“

Interpreted - that could mean Boeing could hypothetically rescind to SPEEA’s contractual demands or forcibly stick to its guns and pressure SPEEA into accepting its terms.

Outsourcing will remain a contentious issue at Boeing, and with China, Japan and Russia all eyeing a route into splitting the Airbus-Boeing duopoly, failure to agree a contract without a strike may just force Boeing’s hands in farming out more design and technical work to places like its Design and Technology Centers in Moscow.

Notwithstanding Boeing’s relationship with Russia for advanced titanium and other materials used on all 7-series airplanes, the relative ease with which the company can move such critical work overseas will mean any hard bargaining by SPEEA may prove to be counter-productive.

Once the best and final offer is presented, the ballot will ultimately decide the long term fate of such high value work.

(Prior articles on the Boeing/IAM/SPEEA strike/discussions can be found by clicking these links here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here and here.)

8 comments November 10th, 2008