Striking employees at Boeing Co. BA are poised to vote on a new contract proposal on Monday. The proposal, which includes a 38% wage increase over four years and a larger signing bonus, has received backing from the workers’ union.
What Happened: The International Association of Machinists and Aerospace Workers (IAM) stated that they have negotiated the best possible terms with Boeing. Previously, union members had turned down two offers from the company.
Reuters reported on Friday that this new offer comes as Boeing attempts to stabilize its finances amid a seven-week strike involving over 33,000 factory workers on the U.S. West Coast. The strike has significantly affected Boeing’s cash flow and halted production of key aircraft models.
Acting U.S. Secretary of Labor Julie Su facilitated recent negotiations, lauding both parties for their efforts. President Joe Biden also praised the union and Boeing for reaching a new contract proposal, highlighting the sacrifices made by Boeing’s machinists.
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Boeing’s latest offer includes a $12,000 ratification bonus, integrating previous bonuses into workers’ 401(k) retirement accounts. Despite the improved terms, approval remains uncertain as some workers express dissatisfaction due to the absence of a defined-benefit pension.
Why It Matters: The ongoing strike has already cost Boeing an estimated $2 billion over the last five weeks. The machinists’ rejection of previous offers has added further uncertainty to Boeing’s financial recovery efforts.
In a bid to bolster its finances, Boeing recently expanded its stock offering, aiming for a $20.7 billion windfall. The company priced its public offerings at 112.5 million shares of common stock at $143.00 each.
Price Action: Boeing saw its stock climb higher by 2.77% during the after-hours market after it closed at $149.31 on Thursday, according to Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
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