Boeing Chooses to Decrease Executive Compensation, Imposes Layoffs on Non-Union Employees during Labor Dispute
The temporarily laid-off workers will retain their benefits and will be on a break for one week out of every four in relation to the strike, as outlined in the notice. However, the notice also mentions that these furloughs will affect a significant number of executives, managers, and staff based in the United States.
Luckily, the furloughs will not disrupt the manufacturing of 787 Dreamliner jets at the company's non-union factory in South Carolina, which carries on operating. Ortberg explained in the notice that all tasks crucial to safety, quality, customer support, and important certification programs will be given top priority and will continue.
Ortberg, who commenced his role as CEO on August 8, remarked in the notice that he and the senior management team will also experience a proportional reduction in salary throughout the strike period.
"We remain dedicated to rebuilding our relationship with our unionized employees and resuming discussions with the union to achieve a mutually beneficial agreement as soon as feasible," he wrote.
The strike commenced early on a Friday morning. The majority of commercial aircraft production at the company has ceased. Representatives from the company, the union, and federal mediators reconvened for talks on Tuesday. Prior to the strike, the company had already implemented other cost-saving measures, such as a hiring ban, curtailed travel expenses, and decreased purchases from suppliers.
"Although this is a challenging decision that affects everyone, it is a necessary step to safeguard our long-term prospects and assist us in navigating this challenging period," Ortberg wrote. "We will continue to provide regular updates as this situation progresses and do our best to minimize this impact."
Despite the strike impacting a substantial portion of the workforce, Ortberg announced that the business continuity plan ensures essential tasks such as safety, quality, customer support, and certification programs will proceed uninterrupted. Furthermore, in alignment with the furloughs, Ortberg and the senior management team have agreed to a temporary salary reduction during the strike period.
