Boeing's engineering union has decided to drop its demand that its labor contract include a pension for new workers, a move that could hasten a deal as the two sides resume bargaining on Wednesday.

The decision comes after one bargaining unit last week narrowly accepted Boeing's contract offer without the pension for new hires. The other unit narrowly rejected the contract, sending them back to the bargaining table.

"The pension is dead," said Tom McCarty, president of the executive board of the Society of Professional Engineering Employees in Aerospace (SPEEA), in an interview with Reuters.

"We're not going to try to breathe new life into it."

(Reporting by Alwyn Scott)