(Reuters) -Union members who assemble Boeing's 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.

About 3,200 workers who build Boeing fighter jets are poised to walk off the job after failing to reach an agreement on wages and retirement benefits.

The rejected deal featured a 20% wage increase – 8% in the first year, and 4% percent each in years two through four for most union members.