Boeing proposes mediation in talks with engineers union

Thu Nov 29, 2012 5:13pm EST

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

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.

Credit: Reuters/Bobby Yip

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(Reuters) - Boeing Co (BA.N) on Thursday asked for the aid of a federal mediator in contract talks with the union that represents its engineers, citing significant differences 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.

Contracts with the Society of Professional Engineering Employees in Aerospace (SPEEA) union, which represents professional engineers and technical workers at the plane maker, expired in October. A 60-day extension period ended last Sunday, November 25.

The union has balked at a Boeing contract that the union says would cut the salaries and other benefits of professional and technical workers. SPEEA represents about 23,000 Boeing workers. Boeing says its latest offer is much improved over its opening proposal, and reflects a tough competitive environment.

Boeing 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 - despite the fact that the company had come in with an improved offer.

"Both sides are going to need to move," Alder told Reuters. "For them to go above the current offer, just shows you how far apart we are."

Alder said Thursday's meeting included "contentious discussions about salaries," prompting Boeing negotiators to call for a mediator.

Ray Goforth, SPEEA executive director, said in an email sent to Reuters that the union was dismayed that Boeing left talks on Thursday without committing to further negotiation dates. He added that SPEEA has been in contact with federal mediators.

"SPEEA is willing to consider any option to avoid a work stoppage," Goforth said.

In an update on its website on Thursday, SPEEA said Boeing negotiators restated a belief that union members were overpaid and added that union proposals were looking to align pay "to the value we bring to Boeing."

Before the meeting in Seattle, Dennis Muilenburg, president and chief executive of Boeing Defense Space & Security, told Wall Street investors that the two sides were engaged in productive discussions and he expected them to reach agreement eventually.

Muilenburg told an investor conference hosted by Credit Suisse that he had "a great deal of respect" for the engineering team in Seattle that is represented by the union, noting that he had begun his career as an engineer there.

Alder said the talks were at a critical juncture, and Boeing wanted to bring a mediator in as soon as possible.

"We feel it's important to get a mediator in sooner rather than later before one side gets locked into a particular position," he said, noting that Boeing had used mediators in the past and found them to be productive.

(Reporting by Karen Jacobs in Atlanta and Andrea Shalal-Esa in New York; Editing by Bernard Orr)

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