Boeing's desire for forced distribution stumbles into SPEEA contracts

SPEEA members are rightly expressing concerns about The Boeing Company’s recent moves to change the established Annual Compensation Review process to a system that employs a forced distribution of ratings to distribute raises – something the company has already forced onto non-represented employees.

SPEEA initiated discussions by posing several questions to Boeing regarding any potential change to the Performance Management process, retention rating system and/or the Annual Compensation Review (ACR) process. The Overall Performance Rating, formally known as Integrated Performance Assessment (IPA), is the result of the ACR process and is on your salary notification form.

Important: Thus far, nothing has changed for SPEEA-represented employees. If management indicates 70/20/10 or the like applies to anything other than the ACR, contact SPEEA immediately.

If management indicates to you 70/20/10 distribution applies to anything but the Annual Compensation Review (ACR) process, ask your manager:

  • About the ACR process, including any mandated or even suggested differentiation to be used in the ACR.
  • How he or she rated you in light of the differentiation including the metrics, examples, projects, evaluations, etc. used.  
  • Develop a Performance Management Development Plan with Specific Measurable Achievable Relevant and Time-phased (SMART) goals relative to differentiation information and then hold frequent meetings with the manager to evaluate success and opportunities.

** Background **

Employees are already subject to multiple evaluations as shown below.

Performance Management

  • Annual process with at least three meetings; initial, interim, and final
  • Contractually mandated (Article 4 of the Prof and Tech contracts)
  • Individual goals and objectives (e.g. some employees choose easy goals, others choose stretch goals)
  • The Performance Management process cannot be changed without concurrence from SPEEA.

Retention ratings

  • Ratings are subject to a forced distribution of 40/40/20.
  • By level for Techs
  • Independent of level for Profs

Annual Compensation Review (ACR)*

The ACR is the annual activity during which managers assess their employees’ value of contribution relative to their peers and make decisions to reward employees through appropriate merit and incentive decisions for eligible employees.

*This is the process Boeing is looking to change to the 70/20/10 forced distribution.

SPEEA actions

We asked the company to explain the reported changes to employee evaluations with the following questions:

  1. If Boeing is seeking any changes to the ACR process for SPEEA-represented employees, and if so, at what point Boeing plans to request bargaining?

    Boeing responded by saying there is not a corporate edict to move towards a forced distribution (70/20/10 or otherwise) but groups/organizations are strongly encouraged to seek out differentiation in order to encourage performance improvements.

  2. If Boeing is not seeking changes for SPEEA-represented employees, what communications are prudent to assure our members as well as their managers that implementation of forced distribution of the ACR does not apply to them?

    Management responded by stating that in years past, greater, or lesser, differentiation was always applied in determining distribution of selective salary adjustments.

  3. What is Boeing’s motivation to move to a system of forced distribution of raises for any group of employees?

    Management’s response was simply – Because we can.

Ongoing efforts

SPEEA contracts have included guaranteed salary adjustments (aka Guaranteed Wage Increases (GWI)) and selective salaried adjustments for many decades. While our contracts do spell out how much selective money must be spent on the SPEEA population, how management decides who gets how much of an increase each year is left to management discretion under the guise of some performance-based metric. In some years there is a greater spread of the selective moneys than in other years; but, either way, all of the money guaranteed by the contracts must be distributed to SPEEA-represented employees.

Over the years, management has relied upon various permutations of Pay Visibility Tools. The current rendition is called the “Non-Executive Global Salary Decision Tool.” Inputs to the tool include the individual’s compa-ratio (pre-exercise salary/SRT Value) and the Overall Performance Rating (Far Exceeded, Exceeded, Met, Met Some, Met Minimal). The tool then generates a suggested new salary range based upon the available dollars for the exercise. Management has the ability to manually reassign available money or even overspend the pre-allocated allowance for their group.

How much of the salary increase pool is guaranteed to each member and how much is performance based has been a negotiations item for decades. It will likely remain that way for the foreseeable future.

As stated earlier, nothing has changed for SPEEA members to date. We expect continued discussions with Boeing. Thus far, our discussions have been informal – which may explain the company’s incomplete responses. If Boeing wants to pursue an actual change to the ACR process, those changes must be negotiated. That’s the benefit of being union-represented – the company can’t just make changes to wages, benefits or working conditions anytime it has the fancy to do so.