Amid a union strike over a pay dispute, Boeing has made what it describes as its “best and final offer” to roughly 33,000 striking union machinists, intensifying efforts to end the strike, which has entered its second week.
The aerospace giant’s proposal, announced Monday, includes pay raises of 30 percent over four years, a 5 percent increase from the previously rejected 25 percent raise that sparked the strike that began September 13.
Boeing said average annual pay for machinists would rise from $75,608 now to $111,155 at the end of the four-year contract.
Monday’s offer, which Boeing labels as its “best and final,” reflects Boeing’s urgent desire to end the strike, as these workers, represented by the International Association of Machinists and Aerospace Workers (IAM), play a critical role in production.
However, Boeing said the proposal is contingent upon the union ratifying the contract by Friday night.
In the revised contract, Boeing offers an initial pay raise of 12 percent, followed by three annual increases of 6 percent each. The company has also doubled its ratification bonus, now offering $6,000. It plans to maintain annual productivity-based bonuses—a sharp contrast to the rejected offer, which sought to replace them with retirement contributions.
The union has been pushing for a 40 percent increase and the reinstatement of traditional pension plans, which Boeing eliminated a decade ago. This issue was a significant factor in the machinists’ 94.6 percent vote against the previous contract.
Newsweek reached out to Boeing via email and IAM via online form for comment.
A strike sign pictured outside a Boeing factory in Renton, Washington, on September 13. Amid a union strike over a pay dispute, Boeing has put forth what it describes as its “best and final offer.”
Stephen Brashear/Getty Images
At the start of the strike, Brian Bryant, the International President of IAM, said in a statement: “Our members’ rejection of Boeing’s contract was a resounding victory for the entire aerospace industry and workers’ rights. Boeing must now deliver a contract that respects their value and gives them the dignity they deserve.”
“The IAM stands firmly behind our members. Together, we will fight until Boeing offers a deal that our members will accept. Our strength lies in our unity, and we will not back down until they receive the compensation they have earned,” Bryant added.
Meanwhile, the proposal comes as striking workers face mounting pressure. Their final paychecks have already been issued, and company-provided health insurance is set to lapse by the end of the month.
The strike has already begun to dent Boeing’s cash flow, as the halt in production affects deliveries, a major source of the company’s revenue. Notably, work on the 787 aircraft continues with nonunion employees in South Carolina, but the stoppage has shut down key lines, including the 737, 767 and 777.
Since the beginning of 2019, Boeing has lost over $25 billion, including $4.3 billion in the second quarter of 2024 alone, as the company braces for another year of financial losses.
In response to the strike, Boeing CEO Kelly Ortberg announced last week that the company will begin furloughing employees to conserve cash.
In a message to staff, Ortberg said the company would begin furloughing “a large number” of employees, including executives and managers, to other U.S.-based staff, the Associated Press reported.
“While this is a tough decision that impacts everybody, it is in an effort to preserve our long-term future and help us navigate through this very difficult time,” Ortberg said in the company-wide memo.
Though Boeing has not disclosed an exact number, the furloughs are expected to affect tens of thousands of workers.
Under the furlough plan, workers must take one week off without pay every four weeks, though they will retain benefits. Senior executives, including Ortberg, will also take unspecified pay cuts during the strike.
This article includes reporting from the Associated Press.
