BusinessWeek reports that Boeing Inc.'s (NYSE: BA) 27,000 workers in the International Association of Machinists (IAM) union are eager to strike and they don't want to wait. Their anger is a microcosm of all those in America who feel that they have paid the price for globalization. Unfortunately, for Boeing and IAM, there is no contract that can relieve their anger.
BusinessWeek reveals six sources of IAM worker rage:
- Requiring workers to pay more of their health care costs - Boeing "is demanding that workers pick up more of the tab for their health-care costs. Some workers argue that a few visits to the hospital would instantly eat up any wage gains," according to BusinessWeek.
- Limiting death benefits for IAM members' families - Boeing wants to "limit death benefits for survivors, giving spouses of deceased Boeing workers a flat $4,000 payment instead of guaranteed monthly payments for life," according to BusinessWeek.
- Outsourcing - Workers believe that Boeing's decision to outsource much of the work on the 787 is responsible for production delays and that the program would have gone more smoothly if they had done more of the work in the U.S.
- Scandals under previous management - Boeing changed the way it managed -- including moving to Chicago -- in the wake of the dismissal of Philip Condit, "whose standing was hurt by a defense contracting scandal around the awarding of an airborne refueling tanker contract that involved executives below him," according to BusinessWeek and the firing of his successor Harry Stonecipher after he had an affair with a Boeing executive. Workers think the move to Chicago has kept Boeing managers out of touch with its workers.
- Communications strategy - Workers are frustrated that Boeing decided to be open about its contract terms -- such as shifting to 401(k) plans from traditional pensions -- and to advertise its "best and final offer." They would have preferred that Boeing conduct all its negotiations in secret with union leaders rather than talk to workers directly, about which I posted here.
- Cutting back on pay when times are good - IAM believes that Boeing should be sharing its gains from the popularity of the 787, which has generated 895 orders and a backlog over $155 billion, rather than asking for further cutbacks.
I hope I am wrong about this, but after reading the BusinessWeek article, I find it hard to avoid the conclusion that IAM will soon be on strike. It's difficult to imagine anything that Boeing and IAM can agree on in the next day that will make a serious dent in these issues.
Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter
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Reader Comments (Page 1 of 1)
9-05-2008 @ 10:25AM
Kent said...
I visited Boeing in Wichita, KS several years ago and learned then about outsourcing from Japan and China of all places. Even then, I sensed a mood of disastification in the air there. Today, the plant has been closed putting them all out of work. We put a lot time into a project then with them and the rug was pulled out from under us when the plant closed. IAM is concerned about their future for sure.
9-05-2008 @ 7:13PM
Rhonda said...
I am praying that the strike is averted. These workers are only asking for what is fair. Can you believe I was told by a supervisors wife that if the IAM goes n strike her husband gets more overtime since he is in management. This thrilled her!!!! She doesn't have to worry about her medical, because her husband is in management she will get full medical coverage until she dies as well as her husband. If my husband retires, we will get medical insurance only until he starts receiving medicare. My husband also doesn't get all the perks her husband gets. My husband should be getting PTSD pay since in his 30 years at Boeing he has had to worry every three years whether Boeing will lay him off or if he will be on strike. Everything my husband has gotten from Boeing he has worked for. If Boeing asked him to cross train in something he did, if Boeing asked him to move to a different job, he did. Please understand this is not so much about money as it is about fairness. One supervisor's wife actually stated " the workers should just stop complaining, our dollar is so weak in other countries, the jobs will be back here soon, since no other country wants our dollar". How in the world does she think the dollar got so weak. Because we keep sending all of the work outside this country. Go in to a store and see if you can find anything made in the U.S.A. I cannot believe everyone can't see what's happening to our country. Again, these people only want fairness and wording in the contract that will help them keep their jobs. So what if Boeing gives them $2500.00 bonus today and tomorrow their jobs are gone. Not very reassuring is it??? There is a bigger picture that the media is not protraying fairly.
A Concerned Wife, Mother and Grandmother