This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Boeing Risks Strike for Pension Plan Change

ST. LOUIS ( TheStreet) - It puzzles the International Association of Machinists that Boeing (BA - Get Report) so firmly desires to keep future workers from a defined benefit pension plan.

It is possible the conflict will lead to a strike on Monday by 2,500 Boeing workers who make F-15 and F-18 jets. These members of IAM Local 837 will take a second strike vote on Sunday. In an earlier vote, they backed a strike by a 1619-459 margin, and Boeing has not altered its intent to establish a defined contribution 401K plan for new hires. The proposed pension plan change is so important that both sides seem willing to risk a strike over it.

"It's something our members cannot understand," said Mark Blondin, the IAM's national aerospace coordinator. "(Some) other companies are happy to offer defined benefit pension plans."

The Boeing workers in St. Louis, many of them older, belong to a pension plan that was established by McDonnell Douglas and taken over by Boeing. As another option, the IAM offers its own plan, which has assets of $7.3 billion and 104,000 active members. Blondin said its costs are lower than the cost of the Boeing plan. "A lot of companies jump on it," he said, because they are relieved of pension funding responsibilities that many companies view as inordinately rigid.

We Still Like Boeing

In 2009, Boeing introduced a 401K plan for all new-hire, non-union employees. Boeing spokesman Paul Guse said the plan is in place at other Boeing sites, including some with unionized employees.

"Companies including Boeing are shifting to these kind of plans to ensure we provide the benefits package preferred by our future workforce and to align with peer company practices in offering plans that are portable and give control for financial decisions to employees," Guse said.

However, in recent deals with the IAM, Boeing suppliers Spirit AeroSystems (SPR - Get Report) and Triumph Group (TGI - Get Report) both preserved defined benefit pension plans.
More on Boeing
Boeing's Defense Division Explores Start-Ups

In 2005, about 16,000 United (UAUA) agents, ramp workers and stock clerks, represented by the IAM, approved a new contract with $700 million in wage and benefit reductions. The contract includes a defined benefit pension plan, which no other United workers have.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BA $134.63 0.00%
DAL $45.09 0.00%
SPR $49.53 0.00%
TGI $43.25 0.00%
AAPL $111.31 0.00%


Chart of I:DJI
DOW 16,790.19 +13.76 0.08%
S&P 500 1,979.92 -7.13 -0.36%
NASDAQ 4,748.3610 -32.9030 -0.69%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs