For those who didn’t follow the Boeing story, here’s a thumbnail sketch. Boeing threatens IAM union members in Seattle with economic homicide by issuing an ultimatum: either re-open the current contract, which doesn’t expire until 2016, and let us ravage the health, pension, strike and wage provisions, or we move assembly of the 777X (its new airliner) to another state, and you’re all out of a job.
But the local union surprises everyone. By a 2 to 1 margin, they vote down the offer. Stunned by the rejection, Boeing pretends to follow through on its plan to pull up stakes and relocate. Meanwhile, the IAM’s executive board has a series of minor nervous breakdowns as they sift through the wreckage of what they thought was a done deal.
Panicky that this rejection could turn into a real battle, the IAM national leadership insists that the local take another ratification vote, after Boeing makes a big deal of pretending to sweeten the pot. This second vote narrowly passes. The members ratify the offer. The 777X stays in Seattle.
Here are 5 lessons we can take away from it.
Lesson #1: Opportunity. There is virtually no limit to how much leverage a company will exert, or how hard it will squeeze its workers, in order to increase profits. Even though everything is going Boeing’s way, even though it is riding a wave of record profits, and even though it managed to extort from the state of Washington more than $8 billion in tax breaks (the largest corporate subsidy in U.S. history), it still wants more.
Lesson #2: Defiance. You can’t predict how a union will vote. This is especially true when it’s a proud union, a savvy union, a union that recognizes when it’s being mugged. Unions accept inferior contracts all the time. Sometimes they feel it’s the best offer they’ll get, sometimes it’s done for tactical reasons, sometimes it’s the result of fatigue and despair. But these IAM workers don’t fit those categories. They saw the Boeing offer for the sleazy power-play it was and weren’t going to roll over. They should be congratulated. What they did was heroic.
Lesson #3: Caution. Second votes often result in ratification. That’s partly because the members get nervous, and partly because they think it’s the best offer they’re going to get. As a former negotiator, I never faulted people for voting to ratify, even when we begged them not to. They vote “No” the first time to show solidarity, but if we negotiators can’t jack it up, can’t get the company to budge, they vote “Yes” the second time. It happens. And to accuse these good people of being weak or gutless is ignorant and unfair.
Lesson #4: Bureaucracy. In a union hierarchy, the higher up the ladder a person goes, the more tight-assed, timid, and unimaginative he becomes. What the IAM board should have done when the local rejected Boeing’s initial offer was go to the company with smug grins on their faces, and say, “Gee, now what?” They should’ve insisted the current contract be allowed to expire, or that the company rethink the concessions it demanded. Instead, they played into Boeing’s hands by pushing for another vote.
Lesson #5: Perception. Unions can’t count on public support. Unfortunately, there are too many workers out there who don’t understand unions, or resent unions for providing their members with things (wages, benefits, working conditions) they don’t have, or are too ignorant and hard-headed to realize that without resistance—without workers organizing themselves—these companies will take all they can. (See Lesson #1)