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Union rejects Boeing's ( BA ) contract offer, plans strike

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Boeing ( BA ) prepared for strike, cites 40% wage growth offer

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Union demands contract reflecting workers' role in defense

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Boeing ( BA ) expanding St. Louis facilities for new Air Force

fighter

(Changes headline, adds background in last paragraph)

Aug 3 (Reuters) - Union members who assemble Boeing's ( BA )

fighter jets in the St. Louis area rejected the U.S.

planemaker's latest contract offer on Sunday and will strike at

midnight on Monday, the International Association of Machinists

and Aerospace Workers union (IAM) said.

"IAM District 837 members ... deserve a contract that

reflects their skill, dedication, and the critical role they

play in our nation's defense," the union's Business

Representative Tom Boelling said.

Boeing ( BA ) said it was ready for the action. "We are prepared

for a strike and have fully implemented our contingency plan,"

Boeing Air Dominance vice president and general manager Dan

Gillian said in an emailed statement to Reuters.

"We're disappointed our employees in St. Louis rejected an

offer that featured 40% average wage growth," he added.

Boeing's ( BA ) original proposal included a 20% general wage

increase over four years and a $5,000 ratification bonus, as

well as more vacation time and sick leave. The union had

rejected the offer, saying it was insufficient.

Last week, Boeing ( BA ) sent a new contract offer to the union

with some minor compensation changes that would benefit senior

union members, according to the company. The offer also kept

current overtime policies, which Boeing ( BA ) had proposed modifying

in the last contract offer.

The workers assemble Boeing's ( BA ) fighter jets and the MQ-25, an

aerial refueling drone being developed for the U.S. Navy.

Boeing's ( BA ) defense division is expanding manufacturing

facilities in the St. Louis area for the new U.S. Air Force

fighter, the F-47A, after it won the contract this year.

The upcoming strike by the union, representing 3,200

employees, would be much smaller than the one Boeing ( BA ) was hit

with last fall, when 33,000 machinists at Boeing's ( BA ) commercial

plane division walked out for nearly two months. That strike

ended with approval of a four-year contract that included a 38%

wage increase.