Boeing proposes mediation in talks with engineers union

Thu Nov 29, 2012 7:33pm EST
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(Reuters) - In a move that ratchets up tensions in labor negotiations, Boeing Co (BA.N: Quote) on Thursday asked for federal mediators to help unstick talks with the union that represents its 23,000 engineers, saying the sides were far apart on pay and benefits.

"We hope the expertise of the Federal Mediation and Conciliation Service can help move the two sides toward a resolution," Boeing said in a statement.

The move halted discussions around mid-day in Seattle and no further meetings are scheduled, the two sides said.

The breakdown in talks comes as Boeing is speeding up production from 52 jets a month, worth about $8 billion at list prices, to about 60 a month by the end of next year. The company cannot deliver jets without engineer sign-off.

The last time the union struck, in 2000, the company delivered 50 fewer jets that year, said analyst Scott Hamilton, of Leeham Co in Seattle.

The union has balked at a Boeing contract that the union says would cut the growth rate of salaries of professional and technical workers. Taken with cuts in other benefits and inflation, it could cut employees take-home pay, the union says.

Boeing says its latest offer is much improved over its opening proposal, and reflects a tough competitive environment.

Spokesman Doug Alder said company negotiators made the proposal at the end of what he described as a "frustrating" and "contentious" two-hour negotiating session with the union on Thursday. It was the third of three meetings scheduled this week.

He said Boeing was surprised when the union came back with an even more demanding counter-offer - seeking 6 percent pay increases, up from 5 percent in the current contract - despite the fact that the company had come in with an improved offer.   Continued...

Models of Boeing 747 and 777 passenger planes are displayed at the Boeing booth as part of the China International Aviation & Aerospace Exhibition in the southern Chinese city of Zhuhai November 12, 2012, one day before its official opening on Tuesday. REUTERS/Bobby Yip