Boeing, 777x, and Machinists Union

[ERD50]

Third paragraph
The parties agree that the Company may subcontract or outsource certain 777X wing fabrication and assembly work packages, in whole or part, in order to create capacity for other 777X work packages in the Puget Sound facilities, and/or to efficiently utilize those facilities to accomplish the production and assembly of the 777X.
....

This was amazing to me. I worked in non-Union manufacturing, and the idea that the workers would dictate decisions about what and where we would do our manufacturing is totally foreign to me.

That's a decision for management to make. That is why they are called management.

-ERD50

 

[bld999]

This was amazing to me. I worked in non-Union manufacturing, and the idea that the workers would dictate decisions about what and where we would do our manufacturing is totally foreign to me.

That's a decision for management to make. That is why they are called management.

-ERD50

I have seen members of the local ironworkers union successfully claim and subsequently install gage metal doors and frames in a building with a structural steel frame [their usual work]. You can imagine the outcome there; but yes, unions will if powerful enough, participate in those kinds of decisions.

 

[ERD50]

In a a tight labor market, wages tend to rise in lock-step with productivity because workers have a strong bargaining position. Look at wages vs productivity in the US from 1945 to 1970. They were linked. ....

I think this lacks a a cause-effect.

There are plenty of reasons for rising wages in that period. A 'tight labor market' in and of itself is one - the supply/demand proposition that I made in that post. High demand and low supply (tight labor market) provides a strong bargaining position.

And that was largely driven by the US rebuilding a war ravaged world.

If productivity drives the price of something, then the hardware store would charge me a different amount if I bought a hammer for personal use around the house, or that same hammer to build a house. One hammer would be far more productive than the other - yet they sell for the same price.

-ERD50

 

[2B]

I agree on the first line, but I don't think there was ever a time when wages were set by the worker's productivity. They were set by supply/demand. Businesses pay the lowest amount they can to attract the talent they need. Talent seeks the highest wages they can get for their 'product'.

I agree with the wages being a question of supply and demand. Productivity is more a reflection of what value an "owner" can derive from the cost of the labor and other product costs. Whips may make the unskilled slave drag the stone block harder or faster but that's the limit achievable.

Technology is key to substantial improvements in productivity. The stone blocks can be moved quicker when the new technology of greased rollers is introduced. This introduces the need for a higher skilled individuals to place the rollers and direct the greasers. Beating these guys won't really increase productivity but "profit sharing" might.

The need for a higher skill level reduces the supply side since a higher educational level is required. There are multiple examples in history where higher level skills are protected via secrecy and/or guilds to maximize compensation.

I've spent a good portion of my career automating processes. This was usually justified by labor savings (evil me). I might eliminate 10 low skilled positions but replace them with capital equipment (built by more skilled labor) and then operated/maintained with 2 or 3 skilled individuals. As the cost of unskilled labor increases, the justification to automate and improve productivity increases. The cost of unskilled labor can either go up due to unaltered supply and demand or government decree. Either way, the urge to automate will increase.

 

[explanade]

In post-WW II the USA was the industrialized world. As Europe and Asia (mostly Japan) rebuilt, the USA's ability to economically dictate the competitive situation disappeared. I've listened to this unions=prosperity argument before but it somehow never includes the broader macro-economic picture. The other favorite is high taxes rates=prosperity during the same period. It also never includes the macro-economic picture or the infinitely available tax shelters available so no one actually paid the high marginal tax rates.

Nobody is making that claim, that unions=prosperity.

But income inequality was less and the middle class saw real income gains. That probably did better for aggregate demand than the current situation, with stagnant real incomes for all but the highest income tiers.

Whether the income gains back then were due to the leverage unions had, or the fact that all workers, including non-unionized workers, received benefits and income gains.

BTW, it didn't take long for Japan, Germany and others to ramp up. By the 70s, they were economic powers.

US companies, despite the huge trade deficit, sells globally. The tech industry manufacturers electronics in China and sell them all over the world. Back in the '60s, global trade wasn't what it is now, nor the level of US exports. Certainly American companies established global brands like Coke. However, I would expect that most sales came from domestic sales, vs. the typical 50% international sales volumes that most typical US-based multinationals see.

So you think much higher GDP in the '60s was in spite of real income growth for the middle classes (comprised of both unionized and non-unionized workers)? Would GDP growth have been even greater if there was the same level of income inequality and stagnant middle class income growth that we have now?

 

[Chuckanut]

This was amazing to me. I worked in non-Union manufacturing, and the idea that the workers would dictate decisions about what and where we would do our manufacturing is totally foreign to me.

That's a decision for management to make. That is why they are called management.

-ERD50

I generally agree. But, if management wants to trade some of their rights and the union wants to trade some of their rights, and they both think they are better off, who are we to argue?

 

[ERD50]

Nobody is making that claim, that unions=prosperity.

But income inequality was less and the middle class saw real income gains. That probably did better for aggregate demand than the current situation, with stagnant real incomes for all but the highest income tiers.

Whether the income gains back then were due to ...

I don't think you can isolate any one thing and say it was 'due to' that. It was a different time and place, and many factors were in play.

BTW, it didn't take long for Japan, Germany and others to ramp up. By the 70s, they were economic powers.

Exactly, which coincides with the tapering of these wage conditions in the USA. And later, global competition for manufacturing from places like China came into the mix.


-ERD50

 

[pb4uski]

This was amazing to me. I worked in non-Union manufacturing, and the idea that the workers would dictate decisions about what and where we would do our manufacturing is totally foreign to me.

That's a decision for management to make. That is why they are called management.

-ERD50

+1 That is part of the reason that I am not keen on unions in many cases. While I clearly see a useful role for unions in negotiating wages and benefits, beyond that once you're employed you should do whatever the hell you're asked to so unless you can't do it proficiently or we're asking you to do something shady. If it is just a judgement call, then it is management's role and they bear the responsibility and accountability for the results.

 

[Gearhead Jim]

This was amazing to me. I worked in non-Union manufacturing, and the idea that the workers would dictate decisions about what and where we would do our manufacturing is totally foreign to me.

That's a decision for management to make. That is why they are called management.

-ERD50

If one takes that argument in it's logical direction; then wages, working conditions, benefits, etc are ALL management decisions (and at one time WERE considered to be exclusively management decisions); workers who don't like what management is doing are free to go elsewhere.
Time for some sweatshops!

But if unions get too aggressive about pushing for control in these decisions, then the management will eventually take the company elsewhere.
Time for some poverty!

The best outcome for everyone- owners, managers, workers, customers; comes when both sides recognize their limitations and take a long term view of "what's good for me." Unfortunately, that happens too seldom.

 

[tinlizzy]

+1 That is part of the reason that I am not keen on unions in many cases. While I clearly see a useful role for unions in negotiating wages and benefits, beyond that once you're employed you should do whatever the hell you're asked to so unless you can't do it proficiently or we're asking you to do something shady. If it is just a judgement call, then it is management's role and they bear the responsibility and accountability for the results.

Subcontracting gives my work away. I can't do anything "the hell they ask" if Wanda the waitress becomes Rosie the riveter. I have a pension to protect, a pension that likely requires X amount of hours of work per year (probably not including OT) to gain credit.

Most union employees hate pensions (not the pay out but the rules and the length) and would prefer the portability of a 401K with a company match. Like someone else mentioned, most union employees distrust their union and feel like pawns during most contract negotiations.

I think contracts are settled in the very beginning and the union and management then spend the rest of the time trying to devise a way to present what both sides want, without either of them looking weak, and without employees getting any of their own ideas.

It's just a dance and I bet the pension will be out and the 401K in and no or only very specific subcontracting in the final cut.

 

[523HRR]

Some of the work for the 777X could likely go to Japan where the wings for the 787 are made. Sad, but not surprising, that the union in Washington state would turn down this deal.

 

[ERD50]

If one takes that argument in it's logical direction; then wages, working conditions, benefits, etc are ALL management decisions (and at one time WERE considered to be exclusively management decisions); workers who don't like what management is doing are free to go elsewhere.

Time for some sweatshops! ...

I don't think that logic means we digress to sweatshops. Any free market transaction is one that both parties agree to. So yes, if the compensation is poor, the workers will move to someone offering more (because they need the workers).

So management can 'decide' to offer minimum wage, but they may not get the quality of workers they want. Unless they are stupid, they will soon learn to offer more.

We do need laws/regs for the less transparent things - worker safety for example. And we pretty much have those (though not perfect of course). And I am in favor of govt reg of monopoly powers, I don't like to see either the business side or the labor side have too much power - it should be a relatively free market.

At any rate, I'm not talking about taking it to extremes. I think it is clear that workers should not demand a say in how a business is managed, they have a say in whether they want to work there, or somewhere else. If workers want to manage a business, they should start their own.

-ERD50

 

[pb4uski]

....It's just a dance and I bet the pension will be out and the 401K in and no or only very specific subcontracting in the final cut.

That is a possibility. It is also possible that Boeing will conclude that it doesn't like the dance nor its dance partner and will move to a different dance hall and find a new partner, even if they need to teach them a few dance moves.

 

[tinlizzy]

That is a possibility. It is also possible that Boeing will conclude that it doesn't like the dance nor its dance partner and will move to a different dance hall and find a new partner, even if they need to teach them a few dance moves.

True - like I said before, it's hard to know the answer unless you are directly involved and have a feel for current labor relations. But the financial aspects of the contract is fine so I think it's a game.

I would have voted no, too. My own contract states that I need to work 1801 hrs per year (OT doesn't count) to gain one years pension credit.

If I let that contract stand and split the shop floor with subcontractors, here's what might happen....They decide to do subcontracted wing fabrication on Mondays and I will work 4 - 10's Tues thru Fri. Woo Hoo, more pay than last year at 40 straight hrs a week ....but I have earned no pension credit.

I didn't invent the game but I'm forced to play it and no one is ever going to leave money on the table (their pension) without a fight.

Subcontracting almost becomes a non issue if they can get out from under the pension - that's what I think the real goal is and they have to make converts out of the employees.

 

[pb4uski]

Why wouldn't you earn pension credit for working 4-10s - in most situations overtime is based on 40 hours per week (not 8 hours a day)?

God forbid that union employees work together with a subcontractor's employees on the same floor on the same days. Talk about dinosaur thinking! Seems like a fast track to extinction in today's modern world to me.

 

[tinlizzy]

Why wouldn't you earn pension credit for working 4-10s - in most situations overtime is based on 40 hours per week (not 8 hours a day)?

God forbid that union employees work together with a subcontractor's employees on the same floor on the same days. Talk about dinosaur thinking! Seems like a fast track to extinction in today's modern world to me.

OT here is based on whatever pays the most - which would be over 8's. I don't know anything, as I'm not in the machinist union. Just guessing and trying to add to the understanding of what may be going on based on my own union experience.

 

[jon-nyc]

Though in this case no such manouvering would be necessary, the contract they voted down would have explicitly stopped their DB pension and replaced it with a 401k with company match.

 

[ziggy29]

God forbid that union employees work together with a subcontractor's employees on the same floor on the same days. Talk about dinosaur thinking! Seems like a fast track to extinction in today's modern world to me.

The thinking is that the union doesn't want there to be a temptation for management to use non-union workers to do things that are supposed to be done by the union guys. When I worked aerospace a couple decades ago, it was like this -- if a salaried or otherwise non-union person wanted to do something that was "union work" -- including emptying their wastebasket -- they were supposed to be escorted by an hourly (union) employee.

I can understand they don't want to encourage management to crowd out the union labor, but IMO it can be taken to absurd extremes.

 

[pb4uski]

...When I worked aerospace a couple decades ago, it was like this -- if a salaried or otherwise non-union person wanted to do something that was "union work" -- including emptying their wastebasket -- they were supposed to be escorted by an hourly (union) employee.

I can understand they don't want to encourage management to crowd out the union labor, but IMO it can be taken to absurd extremes.

I totally understand but that is exactly why IMO the union's scope should be limited to negotiating pay and benefits. Where I worked, you do what you needed to do to get the job done. Heck, I remember pitching in and doing some entry level work (three levels down) one night since all my folks were busy doing other things and it was something that needed to be done and I was less busy than they were. Sometimes, we had people stretch out of their comfort zone where we needed to. It was a totally different culture where everyone had their eye on the same end goal and achieving the goal was more important than process. And we found a way to have a lot of fun along the way.

 

[jon-nyc]

The thinking is that the union doesn't want there to be a temptation for management to use non-union workers to do things that are supposed to be done by the union guys. When I worked aerospace a couple decades ago, it was like this -- if a salaried or otherwise non-union person wanted to do something that was "union work" -- including emptying their wastebasket -- they were supposed to be escorted by an hourly (union) employee.

I can understand they don't want to encourage management to crowd out the union labor, but IMO it can be taken to absurd extremes.

Years ago I worked as a consultant, clint was a union shop. One of the unions had to plug anything in or unplug it, no one else was allowed to do that. We consultants arrive, on a 10-12 week assignment. Our workspace was a large conference room near the executive suite. We arrive, plug in our laptops (which were novel at the time) and started working away.

Next day we heard the union filed a grievance.

For the next few weeks we had a union guy there in the morning and evening to plug in and unplug our laptops By week 5 or 6 they had negotiated a deal whereby we could plug in our own laptops. Since we were outsiders and our stay was limited the union figured it wasn't much of a threat.

 

[HFWR]

Years ago I worked as a consultant, clint was a union shop. One of the unions had to plug anything in or unplug it, no one else was allowed to do that. We consultants arrive, on a 10-12 week assignment. Our workspace was a large conference room near the executive suite. We arrive, plug in our laptops (which were novel at the time) and started working away. Next day we heard the union filed a grievance. For the next few weeks we had a union guy there in the morning and evening to plug in and unplug our laptops By week 5 or 6 they had negotiated a deal whereby we could plug in our own laptops. Since we were outsiders and our stay was limited the union figured it wasn't much of a threat.

None of the union jobs I had (1970s) were quite this bad. Mostly the union prevented slackers from being canned... But, to be fair, companies and their management can be equally goofy.

 

[Texas Proud]

I totally understand but that is exactly why IMO the union's scope should be limited to negotiating pay and benefits. Where I worked, you do what you needed to do to get the job done. Heck, I remember pitching in and doing some entry level work (three levels down) one night since all my folks were busy doing other things and it was something that needed to be done and I was less busy than they were. Sometimes, we had people stretch out of their comfort zone where we needed to. It was a totally different culture where everyone had their eye on the same end goal and achieving the goal was more important than process. And we found a way to have a lot of fun along the way.

When I worked at a union place back as a teenager (grocery store), you could do any job that had a base pay lower than what you were making... but you could not do any job with a base pay HIGHER than what you made...


It was made very apparent to me when I was a sacker (the lowest pay)... I was throwing baby food jars into the bag... one got away an hit the floor... I was going to scoop up the glass so nobody stepped on it... but the store manager was running at me and telling me not to touch anything... I watched HIM clean up the mess since it was at the busiest time of the day and nobody was available...

 

[NW-Bound]

I enjoy the above stories about working alongside union members. Here's my story.

Thirty years ago, I worked for an electronic company that had a system installed on a commercial jet. The system had several control panels for pilots to use, but there was one control panel for airline mechanics to use. We were still in development phase, but when working on the developmental aircraft at the airframer, we were not allowed to touch that single control panel. Reason: it was meant for aircraft maintenance, and the "right" to push any buttons or switches on that panel belonged to a union member.

So, they had to assign a union guy to work with us, so that we could tell him to push that button or flip that switch. This guy had his union-negotiated hours, so when he took his break, we had to stop all work.

 

[pb4uski]

Years ago I worked as a consultant, clint was a union shop. One of the unions had to plug anything in or unplug it, no one else was allowed to do that. We consultants arrive, on a 10-12 week assignment. Our workspace was a large conference room near the executive suite. We arrive, plug in our laptops (which were novel at the time) and started working away.

Next day we heard the union filed a grievance.

For the next few weeks we had a union guy there in the morning and evening to plug in and unplug our laptops By week 5 or 6 they had negotiated a deal whereby we could plug in our own laptops. Since we were outsiders and our stay was limited the union figured it wasn't much of a threat.

When I worked at a union place back as a teenager (grocery store), you could do any job that had a base pay lower than what you were making... but you could not do any job with a base pay HIGHER than what you made...

It was made very apparent to me when I was a sacker (the lowest pay)... I was throwing baby food jars into the bag... one got away an hit the floor... I was going to scoop up the glass so nobody stepped on it... but the store manager was running at me and telling me not to touch anything... I watched HIM clean up the mess since it was at the busiest time of the day and nobody was available...

....Thirty years ago, I worked for an electronic company that had a system installed on a commercial jet. The system had several control panels for pilots to use, but there was one control panel for airline mechanics to use. We were still in development phase, but when working on the developmental aircraft at the airframer, we were not allowed to touch that single control panel. Reason: it was meant for aircraft maintenance, and the "right" to push any buttons or switches on that panel belonged to a union member.

So, they had to assign a union guy to work with us, so that we could tell him to push that button or flip that switch. This guy had his union-negotiated hours, so when he took his break, we had to stop all work.

I would go bonkers as a manager in any such environment - actually I would just quit because my tolerance for such BS is very low. Each is totally ridiculous.

 

[haha]

Piece in today's Puget Sound Business Journal

How Washington state can charm Boeing - Puget Sound Business Journal

This article by some state reps focuses on what the State of Washington might do, to address longstanding Boeing complaints about trying to do business in our region. Our recent history has been poor IMO. It's like if your girlfriend told you that she was getting tired of your sloppy clothes, and you made no changes to respond to her suggestions. Not smart, and I feel fairly sure that this time around not only the Machinists also but the state is going to have to show more cooperation, if our region will not have to say goodbye to this very large project.

I hope you can see this article.

Ha