Negotiator: Machinists must decide on Boeing offer

SEATTLE - Is there still a chance that Puget Sound-area machinists could reach agreement with Boeing (BA) to handle much of the work on the company's new 777X jet? Hours after it appeared that negotiations between the company and the union had collapsed, there were more questions than answers.

A national Machinists union negotiator told The Seattle Times late Thursday that union members should get a chance to make their own decision on what Boeing called its "best and final counterproposal."

Local Machinist union leaders said in a statement that they could not recommend that offer because "the price was too high."

Meanwhile, Gov. Jay Inslee said he would continue talking with both sides.

"Despite today's setback, I remain convinced that an agreement between the Machinists and Boeing would be in the best interest of all parties -- the workers, the company and Washington state," he said in a statement. "We have submitted our state's proposal and I still hope that the company will recognize that the best way to ensure that the 777X is delivered to its customers on time and at the least cost is to build it here."

Boeing said it has received proposals from 22 states eager for the 777X jobs.

"Our members are very sophisticated and smart on this matter," Rich Michalski, who represented the national leadership of the International Association of Machinists in the talks, told The Times.

"Once we get the information on the offer to them, they will let us know," Michalski said. "We really need to hear from our members."

Earlier in the day, Tom Wroblewski, president of local Machinists District 751, said his members want to build the 777X. "However, the price Boeing demanded was too high," he said in a statement. "Our senior leadership team could not recommend Boeing's counteroffer."

He called Boeing's new offer "mostly unchanged" from the 777X jobs proposal union members rejected last month by a 2-to-1 margin, in part because it would have replaced workers' traditional defined-benefit pension with a defined-contribution savings plan.

Boeing Co. spokesman Doug Alder said the revised proposal presented Thursday included previously proposed "changes to the way members earn future retirement benefits," meaning a defined-contribution plan, but it withdrew an earlier proposal to dramatically slow wage growth for new hires. The new offer would have kept in place the current rate at which employees rise to the top of the pay scale.

Boeing's offer was contingent on union leaders recommending acceptance, Wroblewski said.

"This we could not do," he said. "Our members had already rejected this."

In a telephone interview late Thursday night, Boeing's Alder declined to characterize anything said about contingencies, but declared, "The offer is on the table and that remains in the hands of the union.

"The offer has not been withdrawn," he added, "It's up to the union to decide whether to put it to a vote or not."

Bryan Corliss, a spokesman for Machinists District 751, said late Thursday that local union officials were trying to reach Michalski.

An Associated Press call to union headquarters in Maryland was not immediately returned.

Other states are "lined up" to take the 777X jobs away from Washington, Michalski told The Times.

"Our members are aware of that," he said, adding that union members must "look at the facts, the situation as it is."

Michalski insisted there is no difference of opinion between the national union leadership and local union leaders.

"We've listened to the union leadership and had an open dialogue in hopes of moving toward each other," Ray Conner, president and CEO of Boeing Commercial Airplanes, said Thursday. "Unfortunately, the offer, which would have ensured this great airplane for the Puget Sound region, was immediately rejected by the union leadership."

The union and the company reopened talks Tuesday, which was also Boeing's deadline for other states to submit proposals to build the new jet.

Alder said the company's focus now is on moving forward in the site selection process.

On top of a previously offered $10,000 signing bonus, employees would have received an additional lump sum bonus of $5,000 in Boeing's counterproposal, Alder said.

The company would have committed to placing final assembly of the 777X, as well as the fabrication and assembly of the airplane's composite wing, at a Boeing location in the Puget Sound area. In addition, a separate agreement committing to final assembly of the 737 MAX at the Renton, Wash., site would have been extended through 2024.

After the Machinists rejected the initial proposal Nov. 13, Boeing immediately began soliciting bids across the country. Lawmakers in Missouri held a special session to approve incentives in hopes of landing the 777X work.

Boeing said Thursday that many states submitted multiple sites for consideration. The company said 54 sites are now being evaluated.

In its own bid to win the 777X jobs, Washington state recently approved tax breaks for Boeing valued at $9 billion over the coming years, along with legislation to improve aerospace training programs and the permitting process.

Chicago-based Boeing began offering the 777X in May, but it's still finalizing plans for the plane and aiming to deliver the first aircraft by the end of the decade. Boeing has said it is expected to carry as many as 400 passengers and be more fuel efficient than the current 777.

At the Dubai Airshow last month, Boeing received orders for 225 such planes from three airlines.