Boeing's machinist union members on Monday voted to ratify a new contract and end the seven-week strike after reaching an agreement with the Dow Jones manufacturer on Thursday. The 33,000 frontline workers must return to work by Nov. 12.
The new agreement passed with 59% of members in favor of the proposal, which was the first offer that union leaders have endorsed. The IAM leadership did not provide a recommendation for the previous proposal for a 35% pay hike on Oct. 23, which was rejected with 64% of members voting against it.
The accepted offer includes a 38% general wage increase over four years, which compounds to 43.65% over the lifetime of the agreement. The workers secured a $12,000 ratification bonus, up from $7,000 for the prior deal.
The deal also increases Boeing's 401(k) contribution to its union members' retirement plans, reinstates an incentive plan, and improves its disability plans and overtime rules, among other benefits.
Returning To Work
"This contract also creates a new foundation to build on for the future and that future begins today," IAM district leaders Jon Holden and Brandon Bryant said in a joint statement. "We are ready to help Boeing change direction and return to building the highest quality and safest planes in the world."
Union members can return to work as early as Wednesday. Workers must return to the jobsite by Nov. 12.
The IAM noted that U.S. Secretary of Labor Julie Sue was instrumental in securing a resolution on behalf of the Biden-Harris administration.
"We were pleased to reach a ratified agreement with IAM 751 & W24 tonight," Boeing CEO Kelly Ortberg wrote in a note to employees on Monday. "While the past few months have been difficult for all of us, we are all part of the same team. We will only move forward by listening and working together. There is much work ahead to return to the excellence that made Boeing an iconic company."
However, Boeing did not restore its traditional pension plan that was terminated in 2014, which was a priority for striking workers. Boeing previously stated that its old pension agreement was financially "unsustainable." The company removed the plan in 2014 as part of a deal with union machinists to build its 777x jetliner in Washington.
The deal comes after Boeing posted a $6 billion net loss for its Q3 results. The Dow Jones manufacturer is also looking to raise about $21 billion to plug its cash drain.
Boeing Stock
Boeing stock declined 2.6% Tuesday, sliding from around its 50-day moving average. The stock ticked up slightly on Monday.
BA shares have tumbled about 42% so far in 2024, just behind Intel among this year's worst-performing Dow Jones Industrial Average names.
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