Boeing Workers End The Most Disruptive Strike In A Decade

November 2, 2008 10:50 a.m. EST

Seattle, WA (AHN) - The strike at the Boeing Co. (NYSE: BA) ended Sunday with the ratification by machinists after a majority of employees accepted the four-year contract agreed by the company and the union in the last meeting.

The machinists in Washington, Oregon and Kansas returned to work today after ending a 58-day walkout with 74 percent of employees voting in favor of the contract.

Under the agreement, around 27,000 employees working at Boeing will receive general wage increases of 15 percent over four years, an immediate 16 percent pension increase and lump sum payments of 10 percent of the previous year's earnings or $5,000, whichever is greater.

"This new contract addresses the union's job security issues while enabling Boeing to retain the flexibility needed to run the business," Scott Carson, Boeing Commercial Airplanes president and CEO, said in a statement on Sunday.

"It rewards employees for their contribution to our success with industry-leading pay and benefits and allows us to remain competitive."

The tentative four-year pact, rather than the three year contract, was formulated over a five-day meeting with the help from federal mediators along with the members from the International Association of Machinists and Aerospace Workers (IAM) representing machinits.

The IAM is the country's biggest industrial trade unions, which represent more than 700,000 active and retired members in industries including airline, aerospace, manufacturing, railroad, woodworking and shipbuilding sectors.

The strike that began on Sept. 6, crippled the production of aircrafts at its United States plant including the manufacturing of the 787 Deamliner, which is their new plane in the pipeline.

With the delays in production, the company had to cut profit by about $10.3 million a day and further pushed the scheduled first flight of the 787 Dreamliner into early next year.

Boeing Co. is expected to produce at least 40 airplanes every month to reach its 2008 projected deliveries.

The workers including electricians, painters, mechanics and other production employees, suffered a loss of as much as $7,000 on an average of base pay since the strike started.

Boeing Co. is one of the leading companies in manufacturing sector that exports products of higher values and based on the dollar value against other currencies, the delayed exports can further harm the U.S.'s economic growth.

The previous two strikes by the members from the International Association of Machinists and Aerospace Workers at the firm's commercial aircraft plants lasted 24 days in 2005 and 69 days in 1995, respectively.