‘I do expect to lose,’ Boeing lawyer tells Congress
That’s what Boeing’s lead attorney said Thursday during testimony before a U.S. Senate committee.
“I do expect to lose,” said Michael Luttig, who is an executive vice president at Boeing as well as chief counsel. Even so, the company plans to spend the next four years fighting the case through federal appeals courts, even though that will cast a shadow on Boeing’s efforts to develop its South Carolina operations, he said.
Luttig was one of four witnesses to give testimony May 12 at a hearing of the U.S. Senate’s Committee on Health, Education, Labor and Pensions. The hearing was called so that Senate members could consider ways to reverse the decline of America’s middle class, but Republicans allowed Boeing’s lead lawyer to turn it into a debate on the NRLB’s complaint against the company.
Boeing is scheduled for a June 14 hearing with a federal administrative law judge in Seattle, to face the NLRB’s accusations that it violated the rights of members of Machinists Union District Lodge 751 by taking away their work on the 787 program as retaliation for their past and possible future strike activity.
Luttig sat at the witness table and read an 18-page legal brief that outlines Boeing’s defense against the NLRB complaint – a defense that NLRB lawyers have already investigated and rejected. Meanwhile, Republican senators used Luttig’s appearance before the committee as an excuse to attack the NLRB for its efforts to enforce the law, repeating Boeing’s claims that the agency is “over-reaching” as it seeks a remedy for the way the company intimidated Machinists.
But Democrats on the panel struck back, questioning the way Boeing and its political allies have behaved since the complaint was announced on April 20.
Sen. Tom Harkin, D-Iowa, who was chairman of the hearing, particularly criticized Boeing CEO Jim McNerney for his comments in the Wall Street Journal on May 11. Harkin said they amounted to a thinly veiled threat to move Boeing work out of the United States altogether unless the company gets its way in the NLRB case.
Boeing has $19.5 billion in federal government contracts, Harkin said. “It seems to me that Mr. McNerney, instead of making veiled threats, should be saying ‘Thank You.’”
Harkin also chastised Luttig, who claimed that Machinists had made “unreasonable demands” in 2009, during failed talks to secure a second 787 line for Everett, including requests for 3-percent pay raises as part of an 11-year labor deal.
Luttig himself got a 34-percent raise in 2009, Harkin noted, which brought his pay to $3.7 million.
“Why shouldn’t employees at Boeing get a 34-percent increase, Mr. Luttig?” Harkin asked. ”What’s going on here? Why shouldn’t employees also have a share of that?”
Luttig responded with a smirk, saying that as a senior corporate officer, the size of his paycheck is public record, and “this very instant, I have a sense that it’s not enough.” (To watch of a video of their exchange, click here.)
Harkin also criticized Boeing for doing its part to undermine America’s middle class. The average Puget Sound Machinist, he said, makes about $28 an hour, while the person doing the same work in Charleston is paid about $17 an hour.
One makes $56,000 a year while the other makes $35,000. “Hardly anyone’s getting wealthy,” Harkin said, but “it’s the same person, doing the same job, for less. This has all the appearances to me of a race to the bottom and that’s what’s happening to the middle class.”
Boeing has been offered several chances to settle the NLRB complaint without going to a trial, Harkin noted.
Even though Boeing’s Charleston operations have not been affected by the NLRB action, Luttig complained that the company’s efforts there have been hurt. It’s hard to justify further investments in South Carolina, given that “the federal government is seeking to close Charleston,” he said, adding that the issue is likely to end up before the Supreme Court, which could easily mean four years of uncertainty and delays before a decision is reached.
In fact, the NLRB complaint does not require closure of the South Carolina facility, a fact noted by Sen. Richard Blumenthal, D-Conn.
Away from the hearing, the lead attorney for the International Association of Machinists & Aerospace Workers, Chris Corson, dismissed Boeing’s protest about how the NLRB complaint unfairly casts a shadow over Charleston’s future.
Boeing has known about the federal probe since March 2010, he notes, yet it continued to aggressively pursue a twin strategy of moving forward with its transfer of work while trying to delay the NLRB’s issuance of the retaliation complaint.
“Boeing took any risk of harm upon itself,” Corson says. “And it compounded any harm to itself by its own tactics of delay.”
Given that the hearing was supposed to be about finding ways to bolster America’s middle class, Luttig’s testimony was neither “relevant nor appropriate,” District 751 said.
“His long-winded legal jargon isn’t going to create more jobs, just like Boeing’s attempts to threaten our members and move jobs from one state to another won’t grow the overall U.S. economy,” the union said.
“Instead of trying to make excuses for the way Boeing broke the law, Republican senators should focus on what’s important – creating good-paying jobs for hard-working Americans in Seattle and Charleston and everywhere in between – instead of playing one against the other to the benefit of no one.”
Originally formed in 1935 to represent hourly workers at Boeing, Machinists Union District Lodge 751 now represents more than 27,000 working men and women at 44 employers across Washington, Oregon and California. In 2010, District 751 members used collective bargaining to reach contracts with 22 of those employers, without a single day lost to strikes.
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