Hawker, union bear burden of keeping jobs in Wichita

10/13/2010 5:51 PM

08/08/2014 9:59 AM

With a tentative deal reached between the state and Hawker Beechcraft to keep the company in Wichita, the burden is on the Machinists union and the company to forge a successful labor agreement, a labor expert said Wednesday.

"Both parties come to the bargaining table with tremendous pressure on them," said Gary Chaison, professor of industrial relations at Clark University at Worcester, Mass.

Talks between the union and company will restart Friday. A ratification vote is scheduled for Oct. 16.

An agreement on an incentives package was reached with Hawker Beechcraft during a meeting with Gov. Mark Parkinson on Tuesday. It is contingent upon the successful negotiation of a long-term contract with the union.

In exchange for the incentives, Hawker Beechcraft will keep the "vast majority" of jobs in the state, Parkinson said Tuesday.

Hawker Beechcraft employs 7,000 people, including 6,000 in Wichita. Of those, 2,400 are hourly workers represented by the Machinists union.

The Machinists opened negotiations with Hawker Beechcraft a year before its contract expired after it learned the company was considering relocating to bring down costs.

Contract talks were suspended last week to give the company time to meet with the governor after Hawker Beechcraft told the union it had received an offer from Louisiana to move to Baton Rouge, according to union officials.

Parkinson, Secretary of Commerce Bill Thornton, Machinists international general vice president Rich Michalski and Hawker Beechcraft CEO Bill Boisture met for two hours Tuesday.

After the meeting, Parkinson announced that Hawker Beechcraft had accepted a package that includes incentives for product development, work force training and tuition reimbursement for the company and its Wichita employees.

Parkinson did not release more details about the incentives, saying those will be made public after a labor agreement is reached.

Parkinson did say they would be similar to those given to Bombardier Learjet, which included $27 million in bond financing in exchange for 600 jobs and work in Wichita for the life of the bonds.

The incentives will not need legislative approval, the governor's office said Wednesday.

The union is under pressure to reach an agreement to not only to save union jobs, but also to keep the entire company from moving out of state.

"It puts tremendous burden on the union," Chaison said.

It also puts pressure on Hawker Beechcraft to reach a settlement to save jobs because the state is now involved, he said.

"I think the union and the employer are under an obligation to be reasonable," Chaison said. "It's a political obligation.... They have to reasonably present offers and counteroffers because the stakes are so high, and there's a third party involved."

If the company proposes a "tremendous cut instead of a huge cut," the union will publicize it and call up the governor's office, he said.

Boisture, the Hawker Beechcraft CEO, released a memo to employees Wednesday informing them of the developments. The letter repeated statements made by Parkinson and Boisture after Tuesday's meeting.

Boisture thanked the governor and his staff for working to develop a package that can "potentially provide stability and sustainment to Hawker Beechcraft and our presence in Wichita."

"We are also very pleased that we had the full support of the International Association of Machinists in pursuing this process jointly."

In an interview Tuesday before his meeting with Parkinson, Boisture declined to say how contract talks were going before they were suspended.

"I've been very careful to be respectful of the point that this union has offered to open this contract, and that is not something that the company can either expect or demand," Boisture said.

"Therefore, the initiative to be at the table is theirs, and I think it's inappropriate to comment on the progress of those discussions."

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