Beleagured aircraft manufacturer Boeing is to furlough employees, including senior managers and executives, for one week every four weeks for the duration of a strike by factory workers (known as machinists) at its aircraft assembly lines in the Portland and Seattle areas.
In a new memo to employees on Wednesday, Boeing’s new chief executive Kelly Ortberg shared the grim news that many employees would be forced to go without pay as the company reels from the highly damaging and costly walkout by thousands of machinists.
The machinists went on strike on Friday after rejecting a new tentative agreement by 94.6%. The ballot also included a strike authorization vote, which was overwhelmingly passed by workers represented by the IAM 751 union.
Workers help to build some of Boeing’s most successful aircraft, including the best-selling 737MAX and the manufacturer has been left reeling by the setback in labor relations.
Earlier this week, Boeing’s vice president and chief financial officer, Brian West, said the company would go into austerity mode, cutting back all non-essential spending in order to save the cash strapped business much needed money during the length of the strike.
Boeing has told senior executives that they are no longer entitled to First or Business Class travel, and employees must forego business travel and instead rely on virtual meetings as the walkout drags on.
West also said Boeing would suspend advertising and marketing spending, halt charitable donations and withdraw from all future airshows and special events until it can get its finances in order.
“With production paused across many key programs in the Pacific Northwest, our business faces substantial challenges and it is important that we take difficult steps to preserve cash and ensure that Boeing is able to successfully recover,” Ortberg told employees in the latest memo.
“As part of this effort, we are initiating temporary furloughs over the coming days that will impact a large number of US-based executives, managers and employees,” Ortberg continued.
“All benefits will continue for affected employees, and to limit the impact to you, we are planning for selected employees to take one week of furlough every four weeks on a rolling basis for the duration of the strike.”
“Along with these steps, my leadership team and I will take a commensurate pay reduction for the duration of the strike.”
Ortberg told employees that the decision to furlough workers was a “tough” one to make but was necessary to “preserve our long-term future and help us navigate through this very difficult time.”
Boeing had promised its ‘largest-ever’ general wage increase of 25% to its Puget Sound-based machinists, along with a slew of other improvements, including enhanced retirement, improved healthcare provisions, and better work-life balance.
In response to the ballot result, Ortberg says Boeing is “committed to resetting our relationship” with striking workers and new bargaining sessions are due to begin this week.
Boeing and the IAM 751 union are being helped by the Federal Mediation and Conciliation Service to hammer out a reworked deal.
That “most successful ” aircraft has only killed 346 people in its first 2 years as well as doors falling off….thats what I call success! Let the greedy Boeing employees go without for a bit. It will be good for them. Don’t worry, WA State will likely provide immediate no-wait unemployment, housing vouchers, food and free Marijuana delivery for them.