Shavon Jefferson

HRMG 5930

Labor Relations

Boeing/ NLRB Review

Summary of the Issues Boeing Company is an international corporation engaged in developing and producing military and commercial aircraft. Boeing has a collective bargaining relationship with the International Association of Machinist and Aerospace Workers (IAM). Historically The Pugent Sound employees performed the final assembly of all Boeing planes. In late 2003, Boeing announced that it would place the assembly line for its new 787 “Dreamliner” airplane in Washington. The line opened in May 2007. However Boeing departed from its previous practice of manufacturing most of the aircraft parts with its own employees and instead outsourced parts production to other suppliers which included Vought Aircraft Industries in North Charleston SC. In mid 2008, the media began reporting that Boeing would need to add a second 787 assembly line because of its growing and backlog. At about the same time, Boeing entered negotiations with the Union for a collective-bargaining agreement. During the negotiations, Company officials noted the need for a second assembly line but did not discuss details. Due to not being able to reach an agreement there was a 57 day strike that ended November 1st 2008. In early 2009 the media again began publishing that Boeing needed a second assembly line. Talks began between the Union and Company on how to avoid future strikes and better communication. In July of 2009 Boeing purchased the Vought plant in North Charleston and began a decertification petition. In August Boeing emailed its managers and human resource department that it planned on beginning construction in South Carolina for the second 787 line.
On March 26, 2010, the International Association of Machinists and Aerospace Workers, District Lodge 751, filed a charge with the NLRB alleging that the Boeing Company had engaged in multiple unfair labor practices related to its decision to place a second production line for the 787 Dreamliner airplanes in a non-union facility.
Union Position The complaint issued by the Acting General Counsel alleges that Boeing violated two sections of the National Labor Relations Act by making coercive statements and threats to employees for engaging in statutorily protected activities, and by deciding to place the second line at a non-union facility, and establish a parts supply program nearby, in retaliation for past strike activity and to chill future strike activity by its union employees. October 21, 2009 on a company conference all posted for all employees Jim McNerney, President, Chairman and CEO made a statement that they were moving to South Carolina due to strikes happening every three to four years. October 28, 2009 a memorandum was sent out informing employees that its decision to locate the second Dreamliner line in South Carolina was made to reduce the Company’s vulnerability to delivery disruptions caused by work stoppage Three other incidents of Boeing executives stating to newspapers and reporters about moving to South Carolina to avoid strikes were presented as well. Specifically, the union charged that the decision to transfer the line was made to retaliate against union employees for participating in past strikes and to chill future strike activity, which is protected under the National Labor Relations Act.
The union also charged that the company violated the National Labor Relations Act by failing to negotiate over the decision to transfer the production line. The Union was requesting that Boeing be made to operate its second line of 787 Dreamliner aircraft assembly production in the State of Washington.
Company Position Boeing denies that its decision to place the second 787 assembly in South Carolina show any violation of the NLRA. Boeing says its decision to place the assembly in North Charleston was due to a favorable business environment for manufacturing companies, significant financial incentives from the State; achieving geographic diversity of its commercial airline operations; as well as to protect the stability of the 787’s global production system. Boeing said they would have made the same decision to place the second assembly in North Charleston even if they had not taken into consideration the impact of strikes. Boeing says it has not discriminated in the hire, wages and tenure or terms of conditions of employment of any Unit member so it has not violated Section 8 of NLRA
Pertinent Contract Provisions
RIGHTS OF EMPLOYEES Sec. 7. [§ 157.] Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a)(3) [section 158(a)(3) of this title.
My Decision After reviewing the case because there was no evidence presented by the Union to show where jobs were lost and they still had their original jobs which was the first line of 787 planes. Boeing was in its rights not to add jobs to Washington because its collective-bargaining agreement with the Union stated they did not have to negoiate with the Union on opening another facility at a different location. Boeing had already begun outsourcing to Vought prior to the strike happening so there is not enough evidence to show that to avoid strikes was the only reason it picked South Carolina. Boeing opening a plant in South Carolina does not prohibit the employees from striking or prohibit the rights set up by the NLRA.
There has also been no evidence submitted by the Union so show that any terms in Section 8 have been violated by the opening of the second facility.