Big raises in SPEEA pact with Boeing

After more than two weeks of intensive negotiations, Boeing and its white-collar engineering union came to terms Friday on a handsome monetary proposal.

The salaries would rise an average 5 percent each year of the four-year contract.

If ratified as expected by the union's 21,000 members, the deal would mean Boeing avoids another walkout on the heels of the lengthy and costly Machinist strike. It would guarantee Boeing four years of labor peace to sort out its accumulating production problems.

Though the possibility of a strike was tossed around by some officials and members of the Society of Professional Engineering Employees in Aerospace (SPEEA) at tough-talking workplace union meetings in recent months, that threat grew ever more unlikely as the economic downturn worsened.

Union officials will recommend their members ratify the agreement, in separate votes for the engineers and for the technical staff.

"Members will be really pleased," Dave Patzwald, chairman of the engineers' part of the SPEEA negotiating team, said in a statement. "The company showed respect and a willingness to work our issues."

Boeing's chief negotiator, Doug Kight, said he was "very gratified about what we were able to accomplish."

Kight said the agreement provides "market-competitive pay and benefits that enable us to attract and retain the best talent, remain on the leading edge of technology and continue to win business in uncertain times."

The deal creates a pool of money for salary increases that is shared among employees based on performance evaluations. Engineers are guaranteed at least 2 percent each year and technical staff at least 2.5 percent. But some will get much more so that the average is 5 percent.

An additional pool of money, averaging 0.5 percent of annual salary, is available each year to pay people promoted.

In the final days of negotiations, according to a person close to the talks, the differences between the two sides narrowed to just a few issues besides the final pot of money.

SPEEA successfully turned back two Boeing proposals.

Boeing wanted to cut SPEEA's Utah members out of the bargaining unit, but eventually backed off.

The company also sought to replace the traditional pension with a 401(k)-style investment savings plan for future hires. Again, Boeing abandoned this goal.

On the issues of outsourcing and the use of non-Boeing contractors in-house, both of which had been the subject of much discussion before the talks began, Boeing and the union settled on a process for consultation.

Boeing rejected SPEEA requests to set time limits on how long non-Boeing contractors could work in-house or to cap the percentage of such labor used.

"We simply can't restrict the use of outside labor in those ways," said Kight. "In the end, the Boeing Company has to run its business."

There was some accord on the issue of using outside subcontractors.

Ray Goforth, SPEEA's executive director, welcomed Boeing's agreement to involve the union in considering any outsourcing of work.

"All along we were seeking a voice in the decision, not a veto on the decision," said Goforth. "But the engineering technical work force will be consulted and their input will be taken seriously on all major outsourcing decisions."

In a statement, Boeing's Kight said the outsourcing language in the proposed contract provides the company enough flexibility to manage the business, while enabling the union "to understand the nature of Boeing's business strategies and plans regarding the use of non-Boeing labor and subcontracting."

Other notable items in the deal include:

• Medical coverage would expand, with very small cost increases, to cover certain preventive procedures such as colonoscopies.

• A pension increase matches the one negotiated with Machinists, jumping from $70 per month per year of service to $83 per month per year of service in the fourth year.

The agreement includes two separate contracts, one for about 14,000 engineers and the other for some 7,000 technical staff — mostly in the Puget Sound region, with a few hundred in Oregon, Utah and California.

SPEEA members design, engineer and integrate new aircraft and military systems.

The two sides entered final intensive negotiations at the SeaTac Doubletree Hotel at the end of last month.

SPEEA salary charts show that base salaries for Boeing engineers cover a wide range, depending on pay grade and merit increases, from around $60,000 a year to nearly $150,000. The range for technical staff is from $42,000 to almost $80,000.

On average, engineers earn almost $89,000 a year in base salary, and technical staff average about $67,000, according to SPEEA.

Overtime and incentive pay increase those averages to $108,000 and $82,000, respectively, according to Boeing.

The SPEEA contract, one year longer than usual, would expire Oct. 6, 2012, a month after the expiration of the recently ratified Machinist contract.

Apparently Boeing is hoping for a smooth September with the Machinists in 2012, so it can switch at once to talking with the engineers on their next go-round.

SPEEA members will vote by mail on the contract offer. Voting packages should be mailed by next Friday and union members will have until Dec. 1 to return ballots for counting.

Dominic Gates: 206-464-2963 or dgates@seattletimes.com