Boeing Returns to Wage Talks After Two Weeks of Strike Stalemate

(Bloomberg) -- Two weeks after Boeing Co. tried and failed to end a strike with the brash move of a direct offer to workers, the planemaker and its largest union are taking another stab at a more conventional pattern of consultation and shuttle diplomacy to end the stalemate.

Most Read from Bloomberg

• Singapore Ends 181 Years of Horse Racing to Make Way for Homes

• From Cleveland to Chicago, NFL Teams Dream of Domed Stadiums

• What Do US Vehicle Regulators Have Against Tiny Cars?

• For a Master of Brutalist Provocations, a Modest Museum Appraisal

• Mexico City Restricts Airbnb Rentals to Curb ‘Gentrification’

A federal mediator has summoned negotiators for Boeing and IAM District 751 back to a Seattle hotel on Monday. It’s the first inkling of movement toward a compromise that might yield a third contract offer — and the possibility of ending the three-week old strike that’s driving up costs for the manufacturer and its 33,000 striking workers alike.

Just how and when the dispute might be resolved remains uncertain. Since the last direct meeting on Sept. 27, there’s been little direct contact between the two sides, which remain deeply divided in particular over a union demand to reinstate a defined benefit pension plan. Last week, workers lost access to company-backed health-care benefits, while each day of strike costs Boeing an estimated $100 million in lost sales.

Unified

As the strike enters its fourth week, hopes are fading for a speedy resolution even after dockworkers at US East and Gulf coast ports quickly ended their walkout last week with an agreement that would boost wages by 61.5% over six years. Boeing’s last unsuccessful overture included a 30% general wage increase.

Bridging the differences will require delicate maneuvering by Boeing and local leaders of the International Association of Machinists and Aerospace Workers, who’ve both made blunders that angered rank-and-file workers. The timing of a resolution will ultimately depend on not just negotiators, but hourly workers reveling in labor’s resurgence and the opportunity to reset their standing after years of stagnant wages and a much-maligned previous contract that stripped away pensions.

“I’d say morale is still high,” said Nico Savranakis, 28, who works as a team lead mechanic at Boeing. “It’s great to see everybody standing together and unified.”

But the economic pain is starting to set in for both sides. Union members haven’t been paid by Boeing since Sept. 19, and they face greater out-of-pocket costs after the health benefits ended.

With its jet deliveries slowed to a trickle by the strike, Boeing’s already difficult financial situation is worsening by the day — with credit-rating companies anxiously watching over the strike’s duration as they consider cutting the credit rating to junk.