Human Relations in Organizations: Applications and Skill Building 8th Edition by Robert Lussier

Exercise 51

Are They Striking It Rich or Striking Out?
In September 2008, the International Association of Machinists rejected Boeing's final contract offer and went on strike. The stakes were high for the company, its customers, and its suppliers-and also for the union leadership and rank-and-f le workers. But the Machinists' strike effects would ripple out around the world, and the longer the strike, the more it cost all types of stakeholders: Boeing would miss hundreds of millions of dollars in profits in 2008, and the 787 Dreamliner program would slip again. Machinists and their families would have to make do without paychecks. Suppliers would stop making more parts, resulting in layoffs. Airlines desperate for fuel-efficient 737s and 777s would be frustrated, contributing to higher airfares.
Along with improvements in compensation and benefits, the union is fighting for job protection. At the heart of the scrimmage is the growing use of contract workers at factories doing the same jobs as full-time union employees. Indeed, the contingency workforce-including independent contractors, part-timers, and temporary workers-tends to be paid less, have little or no health insurance or retirement plans, and few if any protections under existing labor laws. There are about 42 million contingent workers, or about 30 percent of the overall workforce. Boeing says it needs to cut costs to compete with Airbus and other competitors, whereas the union says it needs good-paying full-time jobs. Boeing's striking workers are on the front line of a battle for job security that's playing out in workplaces across the country, unionized or not. Yet, the strike could mean more outsourcing in the future.
Is it ethical for Boeing and other companies to use contingency workers?