A smaller turnout voted 51-to-49 percent to approve the slightly revamped contract between Boeing and the International Association of Machinists and Aerospace Workers Local No. 751.
"It was shocking," said John Gilham. The toolmaker, who has worked at Boeing for almost 40 years, voted against the contract.
The ratification means that Boeing will build its new 777X airliner in Washington.
"We're proud to say that together, we'll build the world's next great airplane — the 777X and its new wing — right here,” crowed Boeing Commercial Airplanes President and CEO Ray Conner in a news release. “This will put our workforce on the cutting edge of composite technology, while sustaining thousands of local jobs for years to come."
Friday's vote reversed the outcome of a Nov. 13 ballot that rejected a somewhat similar contract. "We're just going to have to go forward from here," said Gilham. The new contract expires in 2024, eight years from the current contract’s 2016 expiration date.
IAM 751 chief of staff Jim Bearden announced the results shortly after 10 p.m. on Friday. Local 751 has roughly 30,000 members eligible to vote on the contract. The union declined to say how many members actually voted, but confirmed that the turnout was smaller (by several thousand) than for the November vote.
While the machinists contract was up in the air, Boeing approached some 15 states about potentially hosting its 777X work. The company also pressured Washington and IAM 751 leaders to pass the new contract. The union's national leadership, state and local politicians have all called for the union to ratify the contract, without which the state stood to lose many of its 82,000 Boeing jobs, along with a portion of the 50,000 related jobs. Gov. Jay Inslee pushed for a Jan. 3 vote -- which irritated area labor leaders -- but stopped short of calling for ratification.
Meanwhile, Puget Sound union officials encouraged a no vote, arguing that the revised agreement is not significantly different from the version rejected in November. On Nov. 13, union members voted down Boeing's original contractual changes by a 2-1 margin, saying the changes were being forced on them while their current contract still had almost three years to go.
"There were no drastic changes, to the contract,“ said Princie Stewart, a Renton IAM shop steward who voted no both times. “They just added a couple of dollars here, a couple of dollars there."
"Our members did not like ... the position this put them in," said IAM’s Jim Bearden, adding that members "were subjected to every pressure imaginable” to ratify the new contract — from Boeing, local politicians and the media.
The whole experience just confounded Rick Hermann, an Everett warehouse inventory control worker, and 47-year Boeing veteran, who expects to retire in 2016. "What really bothers me," said Hermann, “is why the international (IAM headquarters) said it was a great deal, the company said it was a great deal and the local officers said it wasn't a great deal.”
This vote came roughly six weeks after Gov. Jay Inslee and state lawmakers handed Boeing a $.8.7 billion tax break, the largest in United States history, which they rammed through the legislature in just three days. The tax break will benefit Boeing from 2024 to 2040.
Olympia has been burned by Boeing before. Lawmakers approved $3.2 billion in tax breaks for Boeing in 2003 to keep Dreamliner construction in state. The same eight exemptions provided then will be extended from 2024 to 2040 in the current bill. But that Dreamliner tax gift didn't keep Boeing from building a second 787 plant in South Carolina and playing that facility and its non-union workforce against Washington in the latest go round.
With that history in mind, the new Boeing bill comes with a caveat: If the company moves any 777X work to another state then the biggest single tax break, the one that trims the preferential business-and-occupation tax rate on the 777X's gross receipts in half, would disappear. That tax break alone is worth an estimated $3.5 billion from 2024 to 2040.
Tax relief was one of the demands Boeing made in exchange for keeping all 777X production in Washington. The other was that its machinists union accept a contract that trims pension benefits for members. The machinists did their part in voting yes on the new contract, albeit begrudgingly and by a hair.
“Tonight, Washington State secured its future as the aerospace capital of the world.,” said Jay Inslee in a press release after the vote. “To make that happen, the International Association of Machinists District 751 took a hard vote that demands the respect of all Washingtonians who will benefit from having Boeing build the 777X here. … I want to thank each Machinist, no matter how they voted tonight."