Hawker Machinists reject contract offer

10/16/2010 12:00 AM

08/05/2014 12:38 PM

Machinists from Hawker Beechcraft rejected the company's contract offer Saturday, expressing anger and cynicism about the company's motives and casting doubt on its future in Wichita.

Fifty-five percent of those who voted rejected the proposed seven-year contract that called for a 10 percent reduction in base pay and higher insurance contributions.

There was no word on whether the company and the union would try to negotiate a new offer, or whether state incentives to keep the company in Wichita remained on the table.

But Mayor Carl Brewer said he would try to meet with union, company and state officials as quickly as possible to find out why the contract was voted down and how the city could hang on to the company.

Sources have said the company has received an offer to move its entire operation to Louisiana. Hawker Beechcraft employs 7,000 people, including 6,000 in Wichita.

"It does put the city and state of Kansas in a difficult position," Brewer said. "These are several thousand jobs that could easily go away, and we could have a lot of people unemployed. This is a real threat."

Hawker CEO Bill Boisture said in a written statement that, along with the state's incentive package, the company had made its best offer to the union and was disappointed with the vote.

The statement did not directly address whether the company would seek a new agreement.

"The company will continue exploring all options and making a series of business decisions in order to remain profitable and competitive in this smaller market," Boisture said.

Many "no" voters said the contract would have made them give up too much in wages and benefits, and they resented being pressured by the state and the company to vote "yes" and save Wichita's economy.

"They're just trying to pacify the workers to get as much money as they can until they leave. And they will leave," said Jay Cole, a sheet metal worker who has been with the company for 20 years.

"A 'yes' vote would've only bought a little more time."

A new labor contract was part of the deal that company and union officials agreed to earlier this month during a meeting with Gov. Mark Parkinson to keep the company from moving.

Hawker Beechcraft accepted a package of state incentives that would retain five major manufacturing operations and two-thirds of the Machinists' 2,600 jobs in Wichita. But the deal was contingent upon a new contract.

Parkinson said in a statement that while he had hoped the company and union would conclude their negotiations Saturday, "I remain optimistic that the two parties will reach a successful resolution that can be approved by a majority of union members."

The statement didn't say whether the state's incentive package would remain in play.

Rita Rogers, chief union negotiator, said the package "is off the table."

Parkinson's spokeswoman, Amy Jordan Wooden, said that hasn't been determined.

"Until we know what the next steps are, there's no way to address that," she said.

What's next

It isn't clear what those next steps will be. Rogers said the machinists will continue to work under the existing contract, and new contract negotiations will begin in 2011.

Asked if talks could begin sooner, she said, "I don't know. That's all open. I can't say yet."

But Parkinson said in his statement, "I look forward to their continued discussions and, ultimately, a labor agreement that will ensure Kansas keeps all of the Hawker Beechcraft product lines and the majority of jobs in Wichita for the long term."

Brewer said he was surprised and saddened by the vote. He had expected a different result based on feedback from union officials, he said.

"We've got to figure out what's going on, and do what we can to save this company," he said.

If Hawker moves, the loss of jobs would have a significant effect on Wichita's economy, said Malcolm Harris, professor of finance at Friends University.

He couldn't speculate on the dollars it would cost, but he said job losses create a multiplier effect. Losing 6,000 jobs, which is 2 percent of the work force, would lead to a loss of 6 percent of the local labor market, Harris said.

Union officials had recommended approval of the contract. But, in addition to a feeling they were giving up too much, Rogers said, workers were tired of "going around in circles" over the years as the company outsourced jobs.

"There's been a lot of unknowns for a long time for the members, with all the outsourcing going on," she said. "They decided to hold on to what they had right now, and they feel they had enough."

The voting followed a tense meeting inside a pavilion at the Kansas Coliseum complex. Members described the meeting as heated.

The media wasn't allowed inside, but shouting could be heard from outside.

Why the 'no' votes

After they voted, many workers milled around the building and vented about the offer.

David Dixon, a 21-year worker who works in flight and interiors, estimated he'd lose $275 a week under the proposal, not counting health insurance.

"We're making decisions based on our families," he said. "Wichita's doing fine, but what about our families?"

"I understand the jobs need to stay here in Wichita," Dixon said, "but as we're talking right now, the company is packing up tools to other parts of the United States. We might as well fight it out."

Larry McCurry, an avionics installer who has worked for Hawker Beechcraft for 13 years, said the company pushed hard for a "yes" vote just so it could use the money it would save to move out of state.

"If they're going to cut your throat, let's do it up front instead of letting me bleed to death," McCurry said.

Workers were in no mood to take the blame if the company leaves town.

"It's not our fault," one woman shouted outside the pavilion. "It's corporate greed."

Gerald Church, a sheet metal worker who has been with the company for 12 years, said his job probably was at risk with a "no" vote, but he voted "no" anyway.

"It was just a bad contract. Everything. Wages, insurance and everything else was just bad," he said.

And his job?

"Whatever happens, happens," he said.

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