Boeing increases pay offer amid union strike entering second week

WASHINGTON: Boeing announced on Monday its plan to resolve the ongoing strike by its largest union with a revised offer, including a 30 per cent pay raise and the reinstatement of annual bonus payments, which were initially slated to be eliminated.

Describing the proposal as its "best and final contract offer," Boeing emphasised that it had made significant improvements in key areas to address union demands, reported German news agency dpa.

"We've made significant improvements to provide more money in key areas," the company said, calling the new proposal to machinists its "best and final contract offer."

Boeing said the workers had until midnight Friday to accept the deal.

The largest Boeing union, IAM, with around 33,000 employees, went on strike on September 13, after 95 per cent of its members voted down the company's previous proposal for a four-year contract.

The rejected contract had offered a 25 per cent pay hike over four years. Workers have demanded a 40 per cent rise.

The strike is affecting Boeing production around Seattle in the northwest of the United States, where models including the bestselling 737 and the long-haul 777 are built. Boeing is already behind on deliveries of the 737 to many airlines.

The Airbus competitor is in crisis following a series of mishaps.

After an incident in January, where part of the fuselage of an almost brand-new Boeing aircraft ripped off shortly after take-off, the company is not allowed to expand production of the 737 series.

Boeing responded to the strike with, among other measures, a hiring freeze. Additionally, employees are being furloughed and business trips are reduced to only the most essential.

The union last went on strike in 2008. The action lasted 57 days and cost the company an estimated US$2 billion, according to analysts.

--BERNAMA-dpa