Issues Surrounding Early Retirees' Medical Plan
The union representing 19,300
engineers and technical workers at The Boeing Company around Puget
Sound is charging the aerospace giant with unfair labor practices
for failing to bargain in good faith and work jointly as promised
to replace early retiree medical benefits for represented employees
who retire at age 55.
The unfair labor practice charge (ULP) was filed Thursday,
November 30 with Region 19 of the National Labor Relations Board by
the Society of Professional Engineering Employees in Aerospace
(SPEEA), IFPTE Local 2001. The charge relates to an agreement in
the 2005 contract negotiations to replace the early retiree medical
coverage benefit.
The union tells ANN that starting January 1, employees hired
into a SPEEA-bargaining unit at Boeing are not eligible to receive
company-paid medical coverage when they retire before age 65.
Boeing traditionally provided the coverage to employees with 10 or
more years of service. Early retiree medical bridges the gap
between age 55 to 65 when Medicare takes over.
Union estimates show replacing the coverage can cost more than
$64,000 for a single retiree.
"At the end of our negotiations, we agreed to work together and
find a solution for new employees," said Cynthia Cole, SPEEA
president. "Boeing management needs to come back into alignment
with the promises made at the end of our negotiations and not rest
until we have a solution."
SPEEA accepted Boeing negotiators’ assurances to jointly
develop a replacement for Early Retiree Medical Benefits during
contract negotiations in 2005. The agreement is stated in a
‘Letter of Understanding’ (LOU). The negotiations
produced three-year contracts that today cover more than 13,300
engineers and 6,000 technical workers. Union members approved the
agreements by wide margins, 89 percent for the engineers and 84
percent for the technical workers. The agreements expire December
1, 2008.
Union leaders and Boeing management held several meetings to
explore a replacement for the coverage. The union agreed to extend
the original deadline beyond June 1, 2006 when no replacement was
offered. Five plans were explored with only one labeled
unacceptable by the union. During a meeting in August, Boeing
proposed the single unacceptable plan -- a health savings account
with a high deductible -– as the company’s only firm
offer to replace the early retiree medical benefit.
On October 31, Cole and Executive Director Charles Bofferding
discussed the lack of progress on early retiree medical and the
need to meet the terms of the LOU with Boeing management, including
CEO James McNerney, during a meeting in Chicago. A few days later,
the union received a letter from Boeing’s labor relations
department stating the company had concluded efforts to replace the
benefit.
"We don’t like dragging Boeing into court to make the
company honor promises to employees," said Bofferding. "However, it
is important for our members that their union holds the company
accountable for the gap between statements during negotiations and
actions later. This was very disappointing and certainly bodes
poorly for our next negotiations."
SPEEA represents 23,900 engineers, technical and professional
employees in Washington, Kansas, Oregon, Utah and California.