SEATTLE - Negotiations aimed at resolving a five-week walkout by Boeing Co. commercial jet production workers broke down late Monday.
Boeing framed the crucial issue as "long-term competitiveness;" a union leader said the machinists were being asked to "bargain away our members' jobs."
Talks between the two sides resumed Sunday for the first time since 27,000 machinists in Washington, Oregon and Kansas went on strike Sept. 6 over issues that include job security, pay, retirement benefits and health care.
Doug Kight, Boeing vice president of human resources and the company's chief negotiator, said the company was disappointed in the breakdown. Monday was the 38th day of the walkout.
"We want to resolve this strike so employees can return to work, but we cannot sacrifice our ability to continuously improve productivity and our long-term competitiveness for an agreement," Kight said in a statement.
Tom Buffenbarger, president of the International Association of Machinists and Aerospace Workers, said by phone that the talks broke down over "the future."
A sharper-toned statement issued by Tom Wroblewski, president of Machinists District 751, blamed the breakdown on the issues of job security and outsourcing.
"The company is attempting to put the union in an unacceptable position to bargain away our members' jobs," Wroblewski said, adding one area of dispute was the job security of 2,000 union members who provide services ranging from material delivery to distribution of parts.
Wroblewski contends Boeing wants to outsource those jobs. Boeing spokesman Jim Proulx declined comment late Monday on the union's specific allegations.
"It has become apparent that the long-term strategy of The Boeing Company is to eliminate these IAM positions and replace the union workers with outside suppliers," Wroblewski said. "The words 'flexibility' and 'competitiveness' for Boeing appear to mean eliminating IAM jobs."
Other key unresolved issues include health care, wages and pensions, Wroblewski said.
In his statement, Kight said, "Given current economic conditions, it is now more important than ever that we retain the ability to respond to a dynamic, uncertain environment."
He added that the company wants its commercial jet production workers back at work.
No new talks were scheduled after a federal mediator adjourned Monday's session.
Analysts have said they think Boeing is losing $100 million or more in deferred revenue each day of the strike, for a total approaching $4 billion.
Union officials have said their members should at least have the right to bid against outside companies for work traditionally done by the machinists. They note that problems with subcontractors caused repeated delays in testing and delivery of the all-new 787 jet well before the strike.
The walkout has further pushed back that program, all but eliminating any chance of a test flight in the fourth quarter of 2008 as planned and risking further delays of deliveries to customers anxious for the fuel-saving, technologically advanced aircraft.
During a 28-day strike against Boeing in 2005, settled largely with retention of existing health coverage, the company delivered three planes and missed more than two dozen deliveries.
Despite the nation's economic crisis this year, Boeing CEO W. James McNerney Jr. has insisted that the company's seven- to eight-year order backlog remains solid. Boeing delivered 10 planes in September after the strike began, saying those aircraft had been largely finished before the walkout, but missed about 30 deliveries because of the dispute.
Union members, meanwhile, are receiving $150 a week in strike pay, less than one-seventh of their average from Boeing. Buffenbarger has said those payments from the union's $140 million strike fund, which continues to receive dues revenue from members in non-striking locals, could continue for five or six months.
Statement by IAM District 751 President Tom Wroblewski
The Federal Mediators adjourned talks today between the Machinists Union and the Boeing Company without reaching an agreement. The Union had hoped Boeing would come to the table looking to resolve this strike, which is in its fifth week; however, this was not the case.
The Company is attempting to put the Union in an unacceptable position to bargain away our members' jobs. The Union currently has 2000 members involved in material delivery, inventory, distribution of parts, materials, equipment, etc.
Throughout these talks and in earlier statements made by the Company, it has become apparent that the long-term strategy of The Boeing Company is to eliminate these IAM positions and replace the Union workers with outside suppliers. The words "flexibility" and "competitiveness" for Boeing appear to mean eliminating IAM jobs. It is a systematic attack on the employees who have generated unprecedented success for Boeing. If Boeing succeeds in their plan, it is our members' concern this will expand to other jobs in the factory.
The IAM is interested in bargaining a contract for the future, which provides success for Boeing and for our workforce - but Boeing has a different agenda. We expect to be a part of the future of the Boeing Company and remain committed to achieving a resolution that protects our members and their families.
The fact is our members have bent over backwards for this Company to make them profitable. We have participated in every lean program, new initiative, fixed vendor mistakes and offered alternative ideas - all to make them successful. It is our members who consistently step up and get the job done for Boeing. We will continue to do that, but not at the price of our jobs.
The Union will continue to look for ways to resolve this strike so that our members can return to building airplanes and making Boeing record profits, but it cannot be at the price of selling out thousands of our members' jobs.
Keep in mind other top issues are still not resolved, i.e. medical, wages, and pensions.