- Associated Press - Wednesday, November 30, 2011

A contentious labor dispute between the Obama administration and Boeing Co. that spawned a national political fight likely will be settled after the aerospace giant and the Machinists union announced Wednesday a tentative deal on a new four-year collective-bargaining agreement.

It was not immediately clear what, if any, impact the new agreement would have on a massive new Boeing plant in South Carolina, where the company has opened a new production line for its 787 airplane.

In a decision roundly condemned by congressional Republicans and leading business groups, the National Labor Relations Board filed a lawsuit earlier this year alleging that Boeing violated labor laws by opening the South Carolina line. The agency claimed that Boeing was punishing Washington state workers for past strikes and said the company should return the work to Washington.

Boeing has vigorously denied the charges, claiming it opened the South Carolina plant for valid economic reasons. GOP lawmakers have introduced a bill in Congress seeking to force the agency to back down.

The agreement would call for a different aircraft the 737 Max to be built at union facilities in Renton, Wash., said Tom Wroblewski, president of Machinists Union District 751.

Lafe Solomon, acting general counsel at the NLRB, called the agreement “a very significant and hopeful development.”

“The tentative agreement is subject to ratification by the employees, and, if ratified, we will be in discussions with the parties about the next steps in the process,” Mr. Solomon said.

Boeing spokesman Tim Healy called the new contract with the union “a starting point of a new relationship with the IAM,” referring to the International Association of Machinists & Aerospace Workers.

The case became a major political issue, with Republican presidential candidates using it to bash the Obama administration. While the labor board is an independent agency, it is dominated by appointees of President Obama, and settlement of the Boeing case removes a potentially damaging element for Mr. Obama in the 2012 campaign.

South Carolina’s Republican Gov. Nikki R. Haley and the state’s congressional delegation had expressed outrage at the NLRB lawsuit, saying it threatened thousands of jobs and millions of dollars invested in the new Boeing facility in North Charleston. She had also pressed GOP candidates seeking support in South Carolina’s key presidential primary to go on record against the NLRB move.