Boeing plans buyouts and layoffs for engineers

Boeing Co. has internally announced a new round of employee buyouts for engineers companywide, including in Southern California, and warned that layoff notices will follow later this month to engineers in Washington state, where the company has a large presence.

Management did not cite a target for the number of projected job cuts.

The news comes after company Vice Chairman Ray Conner and the new chief executive of Boeing Commercial Airplanes, or BCA, Kevin McAllister, warned in December of the need to aim for further cuts in 2017.

John Hamilton, BCA vice president of engineering, sent a memo regarding the job cuts Tuesday to all BCA engineering employees, managers and executives.

Boeing spokesman Doug Alder said similar announcements will be coming for other work groups, such as production workers, as plans are finalized.

Hamilton’s memo states that details of a buyout offer will be sent Friday to engineering employees in eligible skill classifications. Those who accept the offered buyout will end their employment April 21.

The buyout package will be offered to employees in Washington state, Southern California and South Carolina. There are about 3,500 employees in Boeing’s Southern California commercial division.

Hamilton’s message went on to say that 60-day involuntary layoff notices affecting only engineering employees in Washington will be sent out Jan. 20, with layoffs effective March 24.

Those layoffs will affect employees in the skill classifications that were offered a buyout package last year, he said.

This year's buyout offer is going out mostly to employees in different skill classifications. There will be further involuntary layoffs if not enough people accept the buyout offer and it falls short of Boeing's cost-saving target.

Hamilton said there will be two additional rounds of buyouts and layoffs in engineering later this year.

The extent of the additional job cuts “will be driven by our business environment and the amount of voluntary attrition,” he said.

“We continue to operate in an environment characterized by fewer sales opportunities and tough competition,” Hamilton said. “The decision to lower the production rate on the 777 program announced in late December underscores that environment and what we need to do to help Boeing win.”

Alder said the workforce reductions this year, as last year, will be achieved where possible through attrition and voluntary buyouts before involuntary layoffs.

He said the company also will “aggressively reduce overall spending in 2017 in non-labor areas.”

Ray Goforth, executive director of Boeing’s white-collar engineering union — the Society of Professional Engineering Employees in Aerospace — said the process Boeing is following in cutting jobs was worked out in discussions with the union that led to last year’s surprise agreement to a new six-year union contract.

“We knew the company was going to lay off significant numbers of people,” Goforth said. “We wanted to make it as painless as possible.”

Times staff writer Samantha Masunaga contributed to this report.

Gates writes for the Seattle Times/McClatchy.

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