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Originally published December 27, 2011 at 8:03 PM | Page modified December 28, 2011 at 6:30 AM

New council will bring Boeing, Machinists officials together monthly

A top-level joint council that starts meeting next month could be key to the transformed relationship both Boeing and the Machinists say they want.

Seattle Times aerospace reporter

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The detailed work of transforming labor relations between Boeing and its Machinists union — key to the long-term future of this region as a center of airplane manufacturing — begins in January when a top-level council of union and management is set to convene for the first time.

Earlier this month, members of the International Association of Machinists (IAM) ratified a breakthrough contract deal that includes creating the new council, which will meet monthly. It is headed by Stan Deal, vice president of supply-chain management and operations for the Commercial Airplanes division, and Tom Wroblewski, president of IAM district 751.

One of their first tasks will be to set the performance targets for the contract's new incentive bonus plan for Machinists, ensuring the goals are transparent and fair.

But its broader purpose is to build a new, more collaborative relationship to replace the often-bitter divide between labor and management.

The council will provide a forum where the union gets to influence decisions that affect the workforce, while the company can get movement on labor issues that lower profitability, said Julie-Ellen Acosta, the head of human resources at Boeing Commercial Airplanes.

The union has committed not only to labor peace for five years but to work through the joint council to drive up productivity and so help Boeing smooth its planned sharp ramp-up in jet deliveries.

For IAM national president Tom Buffenbarger, the payoff should be future Boeing airplanes built here in the Puget Sound region, even though the agreement makes no commitment to that.

"We can meet (Boeing's) goals in aircraft production and on-time deliveries by having a positively charged workplace," Buffenbarger said. "If all this works, if it's efficient and they're cranking out airplanes and making money, why would they want to screw that up?"

Gary Chaison, a professor of industrial relations at Clark University in Worcester, Mass., said the landmark deal may indeed mark a sea-change in Boeing's union relations.

"This is a new approach that many unions are taking," Chaison said. "They are saying: We're not part of the problem. We're part of the solution."

To achieve the agreement, the negotiations this fall had to break the mold of previous years.

"This whole thing was so not typical of how we have done things in the past," said Wroblewski.

The two sides started intense negotiations almost a year ahead of the usual schedule and arranged for direct talk between top leaders only. They didn't tell the union rank-and-file.

Boeing Senior Vice President Rick Stephens, from Chicago, represented the company's top leadership. Sales chief Ray Conner, a former Machinist from the Puget Sound region who is now widely seen as the heir apparent to the leadership of the entire company, led the Commercial Airplanes team.

The small Boeing team showed up for discreet talks at the South Park union hall with Wroblewski, who was joined by IAM national aerospace coordinator Mark Blondin and Rich Michalski, IAM general vice president, the No. 2 man in the national union.

Conner even attended the talks in between closing two blockbuster sales deals across the world.

After signing a record order with Emirates for 50 widebody 777s at the Dubai Air Show in mid-November, Conner returned to the South Park negotiations, then days later left the hall directly to catch an airplane to Bali, Indonesia, to seal the even bigger commitment from Lion Air for 230 single-aisle 737s.

Wroblewski said the talks produced a "dialogue we haven't normally had."

"We did have a commitment that our talks would be centered on what's good for the company, creating that profitability and productivity," he said. "That's their goal. And our goal is to stay here in Washington state and have good jobs for our members."

With that tight linkage between the fortunes of Boeing and the fortunes of its workers, minds met and the deal was swiftly made.

After weeks of secret talks, Acosta said, when she put her signature to the agreement late on Nov. 29, it was a "euphoric evening."

"We were all kind of pinching ourselves," she said. "This has always been a dream of mine to see something like this happen."

The union agreed to a four-year contract extension that ensures no strikes through September 2016, promising an uninterrupted flow of airplane deliveries and making possible the very steep ramp-up in production that Boeing plans.

The company assured Renton the job of building the 737 MAX. And the economic terms of the deal gave the Machinists a $5,000 signing bonus, 2 percent wage increases and the new incentive plan that may add up to 4 percent more each year depending on performance.

In the past, the IAM's contract dance every three years typically began slowly in the spring and gradually intensified toward a climactic fall frenzy.

By the time the 2008 contract vote came, the rank and file had been whipped into such a fervor in the preceding weeks that an angry crowd of Machinists was chanting "Strike! Strike! Strike!" as they awaited the result. When the IAM's Blondin took the stage to announce that the union leadership had decided to give Boeing another 48 hours to come up with a better offer, he nearly had a riot on his hands as workers booed him and demanded an immediate strike.

This time around, just a week after Wroblewski announced the surprise deal, it passed with an overwhelming 74 percent in favor.

Now the union and the company have five years to reset the relationship inside their joint council and make it work.

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

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