Boeing [BA] employees that are members of a machinists union late Wednesday approved a four-year contract that allows the company to begin planning for the production ramp up of its new 737 MAX commercial aircraft and gives it workforce stability moving forward.
The contract was ratified by 74 percent of the International Association of Machinists & Aerospace Workers (IAM) in Washington, Oregon and Kansas. The new contract, ratified nine months before the current contract was set to expire, runs to September 2016.
Both Boeing and the IAM said the new contract displays improved cooperation between the two. After the vote, the IAM asked the National Labor Relations Board to dismiss a complaint against the company.
The contract puts production of the 737 MAX, which will be a reengined version of the company’s best selling airplane and feature lower operating costs, in Renton, Wash., and calls for wage and pension increases in all four years of the agreement plus a one-time ratification bonus this month. Other aspects of the agreement include a new incentive pay plan for hourly employees that tracks performance on things such as safety, quality and productivity, and an adjustment to the health plan that improves certain benefits in return for modest cost increases.
The contract also creates a Joint Council for Boeing and the IAM to routinely discuss issues such as the workforce, market, competition and performance.