The labor union affiliated with Boeing likewise declines the proposed 30% offer.
The ongoing labor dispute at American aerospace giant Boeing remains unresolved, as the International Association of Machinists (IAM) has rejected the company's latest proposal as inadequate. The union declared that the offer fell short of addressing their concerns, issuing their statement late on Monday night. Boeing was criticized for missing the mark, as their proposed resolution to resolve the conflict failed to materialize. The IAM alleged that Boeing was attempting to create a divide among its members and undermine their unity, accusing the company of using a 'divide and conquer' strategy.
Initially, Boeing proposed a 25% wage increase spread across several years, which was met with resolute rejection by the employees. On Monday, the company countered with a 30% wage hike, enhanced bonus payments, and agreed to reinstate the annual bonus and increase contributions to a pension fund. However, the company labeled the proposal as their final offer, allowing employees until Friday midnight to make a decision.
The IAM challenged Boeing's September 27 deadline for accepting the offer, stating that a vote on the proposal would not occur before then.
During negotiations, the IAM aimed for a 40% income increase across the contract's four-year term. Previously, Boeing employees had agreed to several zero-percent wage increase contracts over the past decade, leading some to express dissatisfaction in the media over earning less than kitchen staff in burger restaurants.
Last year, workers at the three major U.S. automakers secured a 25% wage increase following strike action. The largest Boeing union, the IAM, with around 33,000 members, initiated a strike mid-September.
Impact on Boeing's Heartland
The labor action has disrupted Boeing's production operations around Seattle in the northwestern U.S., affecting the assembly of popular models such as the 737 and 777 long-haul jet. Boeing currently faces delays in delivering the 737 to numerous airlines.
Boeing has been grappling with a series of setbacks and struggling with substantial losses. After an incident in January where a fuselage section of a nearly-new Boeing plane detached shortly after takeoff, the company was temporarily barred from expanding production of the 737 series.
Responding to the strike, Boeing implemented a hiring freeze, placed employees on leave, and drastically reduced business travel. The last time the union went on strike was back in 2008, with the strike lasting 57 days and reportedly costing the company over $2 billion according to industry analyst estimates.
Despite Boeing's efforts to resolve the labor dispute with the IAM, the negotiations have been complex and contentious. The United States Department of Labor has now become involved, expressing concern over Boeing's use of replacement workers during the strike and potential violations of labor laws.
Undeterred by the ongoing dispute, the United States of America continues to be a major market for Boeing, with numerous airlines still placing orders for their aircraft. However, delays in deliveries due to the strike could potentially impact Boeing's reputation and relationships with these clients.
