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EXHIBIT 10.23 ARTICLES OF AGREEMENT BETWEEN STERLING CHEMICALS, INC. ITS SUCCESSORS AND ASSIGNS AND TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO TEXAS CITY, TEXAS DECEMBER 18, 1998 TO MAY 1, 2002 I N D E X PAGE NOS. --------- ARTICLE 1 MANAGEMENT RIGHTS................................................ 2 ARTICLE 2 UNION SECURITY................................................... 3 ARTICLE 3 HOURS OF WORK.................................................... 4 ARTICLE 4 OVERTIME AND PREMIUM TIME REGULATIONS............................ 6 ARTICLE 5 VACATION.........................................................10 ARTICLE 6 SENIORITY........................................................13 ARTICLE 7 SUPERVISORS DOING HOURLY WORK....................................21 ARTICLE 8 WORK CLASSIFICATIONS - TEMPORARY VACANCIES.......................22 ARTICLE 9 STAFFING OF NEW UNITS............................................22 ARTICLE 10 STEWARDS.........................................................22 ARTICLE 11 CONTRACT WORK....................................................23 ARTICLE 12 PAY DAY..........................................................23 ARTICLE 13 PHYSICAL EXAMINATIONS............................................24 ARTICLE 14 DISCRIMINATIONS..................................................24 ARTICLE 15 UNION REPRESENTATIVES............................................25 ARTICLE 16 JURY SERVICE.....................................................25 ARTICLE 17 ELECTION DAY REGULATIONS.........................................27 ARTICLE 18 REPLACEMENT OF CLOTHING..........................................27 ARTICLE 19 LAYOFF NOTICE - SEPARATION ALLOWANCE.............................27 ARTICLE 20 LEAVE OF ABSENCE.................................................29 ARTICLE 21 SANITATION AND SAFETY............................................30 ARTICLE 22 BULLETIN BOARDS..................................................32 ARTICLE 23 COMPANY RULES....................................................32 ARTICLE 24 PRODUCTIVITY STATEMENT...........................................32 ARTICLE 25 FUNERAL LEAVE....................................................33 ARTICLE 26 STRIKES AND LOCKOUTS.............................................34 ARTICLE 27 GRIEVANCE PROCEDURE..............................................35 ARTICLE 28 ARBITRATION PROCEDURE............................................37 ARTICLE 29 ABROGATION OF CONTRACT ARTICLES..................................38 ARTICLE 30 OCCUPATIONAL & NON-OCCUPATIONAL ACCIDENT AND SICKNESS PLAN................................................38 ARTICLE 31 WORK ASSIGNMENTS.................................................41 ARTICLE 32 CONTRACT PERIOD..................................................41 EXHIBIT A 12 HOUR SHIFT AGREEMENT..........................................45 EXHIBIT B WAGE RATES.......................................................62 EXHIBIT C CHEMICAL PROCESS OPERATOR APPRENTICESHIP STANDARDS & AGREEMENTS.........................................64 MAINTENANCE APPRENTICESHIP STANDARDS & AGREEMENTS.........................................76 EXHIBIT D EMPLOYEE BENEFITS................................................92 EARLY RETIREE INCENTIVE..........................................93 PENSION..........................................................93 VACATION YEAR TRANSITION.........................................94 RATIFICATION BONUS...............................................94 MAINTENANCE OVERTIME PROCEDURE...................................95 NO JURISDICTION SUPPORTING INFORMATION...........................96 i I N D E X PAR. NOS. --------- Signatory Unions................................... 1 Basic Principles................................... 2 Union Recognition.................................. 3 Bargaining Union Defined........................... 3 ARTICLE 29 ABROGATION OF CONTRACT ARTICLES.................... 68 ARTICLE 28 ARBITRATION PROCEDURE Appealed Grievance Time Length................... 67 b) Arbitration Expenses............................. 67 c) Arbitrator Authority............................. 67 d) Length of Time to Arbitrate...................... 67 a) Time Limit Failure............................... 67 e) ARTICLE 22 BULLETIN BOARDS.................................... 61 a) ARTICLE 23 COMPANY RULES...................................... 62 a) ARTICLE 32 CONTRACT PERIOD.................................... 79 a) thru c) ARTICLE 11 CONTRACT WORK Laborers Displacing Contract Janitors............. 41 b) Utilize Independent Contractors.................. 41 a) ARTICLE 14 DISCRIMINATIONS Charges of Discrimination........................ 44 b) Letters of Reprimand............................. 44 c) & d) ARTICLE 17 ELECTION DAY REGULATIONS Election Judge................................... 51 b) Employees Time off to Vote....................... 51 a) ARTICLE 25 FUNERAL LEAVE Funeral Leave.................................... 64 a) & b) Funeral Leave while on Vacation.................. 64 c) Pallbearer....................................... 64 g) Proof of Relationship............................ 64 f) ARTICLE 27 GRIEVANCE PROCEDURE Discharge Grievance Process...................... 66 c) thru e) Grievance Lapse Time............................. 66 a) 1) Grievance Time Limit Exceptions.................. 66 f) Length of Time to Answer Grievance............... 66 a) 6) PUC Meeting Membership........................... 66 b) Sick Pay Benefit Grievance....................... 66 a) 5) Step 1 - Grievance Procedure..................... 66 a) 2) Step 2 - Grievance Procedure..................... 66 a) 3) Step 3 - Grievance Procedure..................... 66 a) 4) i I N D E X PAR. NOS. --------- ARTICLE 3 HOURS OF WORK Dentist/Doctor Appt. 3 Hrs Unpaid............... 13 f) Hours of Work - Group 3 (Maintenance)............ 12 a) thru c) Hours of Work - Groups 1, 2, & 4................. 11 a) thru b) Normal Workweek.................................. 13 d) Schedule Less than 40 Hours Inadvertently........ 13 e) Shift Work Scheduling (when deemed necessary)... 13 a) & d) ARTICLE 16 JURY SERVICE Afternoon Court Appearance....................... 48 a) & 50 a) Morning Court Appearance......................... 47 a) Proof of Service................................. 49 a) ARTICLE 19 LAYOFF NOTICE - SEPARATION ALLOWANCE Eligibility of Separation Allowance.............. 56 a) & b) Labor Dispute Lay Off............................ 53 c) Lay Off Notice................................... 53 a) thru b) Lay Off Separation Allowance..................... 54 a) Method of Payment of Separation Allowance........ 55 a) thru d) ARTICLE 20 LEAVE OF ABSENCE Leave of Absence for Personal Reasons............ 57 a) Leave of Absence for Union Conventions........... 57 b) Leave of Absence to Accept Employment with the Union........................................ 57 c) Pregnancy Leave of Absence....................... 57 d) Public Office Appointment........................ 57 e) ARTICLE 1 MANAGEMENT RIGHTS.................................. 5 ARTICLE 30 OCCUPATIONAL & NON-OCCUPATIONAL ACCIDENT AND SICKNESS PLAN Benefit Amount................................... 72 b) Benefit Payment.................................. 72 a) Benefits Based on Normal Workweek................ 71 a) Benefits during Vacation......................... 77 a) & b) Benefits during Work Stoppage.................... 76 a) Benefits while on Probation...................... 72 c) Duration of Benefits............................. 70 a) thru c) Exclusion from Benefit........................... 74 a) thru b) Late Report of Occupational Disability........... 73 c) Plant Service Credit............................. 69 b) Proof of Disability.............................. 73 a) Reporting Absences............................... 73 b) Sick Pay......................................... 69 a) Withholding Benefit Payment...................... 75 a) ii I N D E X PAR. NOS. --------- ARTICLE 4 OVERTIME AND PREMIUM TIME REGULATIONS Bypassing (Scheduling Overtime).................. 22 a) thru c) Call-outs........................................ 15 a) Holiday - (No Work No Pay)....................... 16 d) 4) Holiday Pay...................................... 16 a) thru d) Holidays......................................... 16 a) Overtime Equalization............................ 18 a) Overtime Meals................................... 19 a) thru c) Overtime Premium................................. 14 a) thru d) Shift Differential............................... 20 a) Transportation Overtime.......................... 21 a) ARTICLE 12 PAY DAY Pay Day.......................................... 42 a) Pay Errors Less or More than 8 Hours............. 42 d) Paychecks Direct Deposit......................... 42 b) ARTICLE 13 PHYSICAL EXAMINATIONS Employees Physically Unfit to Perform in Assigned Classification................................... 43 c) New Hire Physicals............................... 43 a) Periodic Examinations of Employees............... 43 b) X-rays........................................... 43 f) ARTICLE 24 PRODUCTIVITY STATEMENT............................. 63 a) thru d) ARTICLE 18 REPLACEMENT OF CLOTHING Clothes Damaged.................................. 52 a) ARTICLE 21 SANITATION AND SAFETY Clip-On Glasses.................................. 59 f) Colored Safety Glasses - Operating Engineers..... 58 b) Commercial or Chauffeur's License - Operating Engineers...................................... 58 a) Eye Exam Payment................................. 59 b) Non-Prescription Safety Sunglasses............... 59 c) Postponing Job for Safety Reasons................ 58 c) Prescription Glasses for Welders................. 59 e) Prescription Safety Glasses...................... 59 a) Safety Shoes..................................... 60 a) iii I N D E X PAR. NOS. --------- ARTICLE 6 SENIORITY Bidding - Apprenticeship Program................. 32 g) Bidding - Bidding Rules.......................... 32 c) Bidding - No Qualified Bidders.................... 32 f) Bidding - Selection of Job Posting Bidders........ 32 b) Grievances - Seniority........................... 36 a) Job Bidding...................................... 32 a) Job Posting...................................... 32 a) 1) Layoffs.......................................... 34 a) thru e) Rehiring......................................... 35 a) Seniority - Four Types........................... 24 b) Seniority - Promotions........................... 31 a) & b) Seniority (Military Service)..................... 27 d) Seniority (Probationary Period).................. 25 a) & 27 a) Seniority (Promoted to Supervision --Permanent or Temporary)..................................... 27 b) & c) Seniority Consolidation of Departments........... 30 a) Seniority Definition of Group. Dept., & Maintenance.................................... 24 c) Seniority Draw................................... 25 c) Seniority for Straight Day Employment............ 25 b) Seniority is Equal............................... 25 d) Seniority List................................... 26 a) Seniority Lost................................... 28 a) Seniority Unbroken............................... 29 a) Transfers - General Mechanic..................... 33 c) Transfers - Operating Unit Reduced Operation or Shut Down...................................... 33 b) Transfers - Stores Employees..................... 33 d) thru f) Transfers of Surplus Group 1 employees........... 33 a) ARTICLE 9 STAFFING OF NEW UNITS.............................. 39 ARTICLE 10 STEWARDS Department Designation........................... 40 a) Xxxxxxx (Benefits)............................... 40 e) Xxxxxxx (Disciplinary Action).................... 40 d) ARTICLE 26 STRIKES AND LOCKOUTS............................... 65 a) thru e) ARTICLE 7 SUPERVISORS DOING HOURLY WORK...................... 37 a) ARTICLE 15 UNION REPRESENTATIVES.............................. 45 a) ARTICLE 2 UNION SECURITY Dues Check Off................................... 6 a) Dues Check Off Cancellation...................... 7 a) & 8 a) thru c) Dues Payment to Signatory Unions................. 9 a) & b) iv I N D E X PAR. NOS. --------- ARTICLE 5 VACATION Bank Days - Vacation............................. 23 k) Choice Designation - Vacation.................... 23 j) Credit Accumulation.............................. 23 b) Hold Over - Vacation............................. 23 o) thru q) Military Service - Vacation...................... 23 r) Seniority/Preference - Vacation.................. 23 i) Sick Leave - Vacation............................ 23 s) Vacation (Dismissal or Voluntary Separation)..... 23 t) Vacation (Resigns Without Notice Or Discharged for Cause)..................................... 23 u) Vacation Back-to-Back............................ 23 y) Vacation Falls on Holiday........................ 23 v) thur w) Vacation Pay - Computed.......................... 23 g) Vacation Period.................................. 23 h) Vacation Splits.................................. 23 l) Vacation Transfers Between Groups or Crafts...... 23 x) Vacations 5, 10, 20 & 30......................... 23 c) thru f) Vacations less than 5 years & probationary period)........................................ 23 a) ARTICLE 31 WORK ASSIGNMENTS................................... 78 a) thru c) ARTICLE 8 WORK CLASSIFICATIONS - TEMPORARY VACANCIES......... 38 a) thru c) EXHIBITS SEE NEXT PAGE v I N D E X PAR. NOS. --------- EXHIBIT A 12 HOUR SHIFT AGREEMENT............................ 45 thru 60 Day Jobs......................................... 46 Extra Operators.................................. 46 Wages............................................ 46 Employee Benefit Plans, ESOP, Pension Life Insurance and Disability....................... 47 Overtime......................................... 47 thru 49 Mandatory Overtime Procedure..................... 49 Charging of Overtime............................. 49 Hours of Work.................................... 50 Overtime and Holidays............................ 50 thru 52 Holiday and Holiday Pay.......................... 51 Shift Differential............................... 51 Vacation......................................... 52 & 53 Seniority........................................ 53 Jury Service..................................... 53 Funeral Leave.................................... 54 Occupational & Non-Occupational Accident and Sickness Plan.................................. 54 Wage Adjustment.................................. 55 thru 60 Interpretation of Attachment E................... 61 EXHIBIT B WAGE RATES......................................... 62 thru 63 EXHIBIT C CHEMICAL PROCESS OPERATOR APPRENTICESHIP STANDARDS.& AGREEMENTS......................................... 64 thru 75 Required Hours................................... 72 MAINTENANCE APPRENTICESHIP STANDARDS & AGREEMENTS............................. 76 thru 90 Required Hours................................... 81 thru 86 EXHIBIT D EMPLOYEE BENEFITS.................................. 92 EARLY RETIREE INCENTIVE............................ 93 PENSION............................................ 93 VACATION YEAR TRANSITION........................... 94 RATIFICATION BONUS................................. 94 MAINTENANCE OVERTIME PROCEDURE..................... 95 NO JURISDICTION SUPPORTING INFORMATION............. 96 vi ARTICLES OF AGREEMENT BETWEEN STERLING CHEMICALS, INC. ITS SUCCESSORS AND ASSIGNS AND THE TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO OF TEXAS CITY, TEXAS 1 This agreement is made between Sterling Chemicals, Inc., its successors and assigns, authorized to do business in Texas, hereinafter referred to as the COMPANY, and the Texas City, Texas Metal Trades Council, AFL-CIO, of Galveston County, Texas, hereinafter referred to as the UNION. It is agreed by the following unions signatory to this Agreement that said Council is their authorized representative for the purpose of negotiating and administering this Agreement and for the purpose of modifying, amending, or waiving any of the provisions of this Agreement: Electrical Workers Local No. 527 Operating Engineers No. 347 Painters and Paperhangers No. 1008 Bridge, Structural, Ornamental & Reinforcing Iron Workers No. 135 International Association of Machinists No. 1446 Affiliated with District No. 37 Sheet Metal Workers Xx. 00 Xxxxxxxxx Xxxxx Xx. 000 Carpenters Local No. 973 Instrument Lodge No. 903 International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers No. 132 Heat & Frost Insulators and Asbestos Workers Xx. 000 Xxxxxxxxxxx Xxxxx Xx. 000 Operating Engineers No. 450 BASIC PRINCIPLES 2 The COMPANY and the UNION have a common and sympathetic interest in the progress of industry. Therefore, a working system and harmonious relations are necessary to improve the relationship between the COMPANY and the UNION, and the Public. Progress in industry demands a mutuality of confidence between the COMPANY and the UNION. All will benefit by a continuous peace and by adjusting any differences by rational, common sense methods. The purpose of this Agreement is to establish harmonious relations for the advancement of the mutual interest of the parties in continuing and improving the manufacture and production of products at said Texas City plant. The COMPANY and UNION agree that they will not discriminate in any manner against any employee because of race, color, religion, age, sex, national origin, disability or veteran status. It is the understanding of the parties to this agreement that any reference in said agreement to the masculine gender is understood to also include those employees of the feminine gender. Now, therefore, in consideration of the mutual promises and agreements herein contained, the parties hereto agree as follows: RECOGNITION 3 The COMPANY hereby recognizes the Texas City, Texas Metal Trades Council as the exclusive bargaining agency for all production and maintenance employees, but excluding supervisory, technical, clerical, plant protection employees with respect to rates of pay, wages, hours of work, and other conditions of employment. Supervisory employees, in the Production and Maintenance Departments, are those who are above the classification listed in Exhibit B, a part of this contract. SCOPE OF AGREEMENT 4 This Agreement constitutes the sole and entire Agreement between the parties. It supersedes all prior Agreements, oral or written, and expresses all obligations of or restrictions imposed on the respective parties during its term. The waiver of any breach, term, or condition herein by Sterling shall not constitute a precedent for future waiver of any breach, term, or condition. ARTICLE 1 MANAGEMENT RIGHTS 5 (a) Except as expressly modified by a specific provision of this Agreement, all the authority, rights, and powers which the COMPANY had prior to the signing of this Agreement are retained by the COMPANY and remain exclusively and without limitation the rights of management. Only express modifications contained in specific provisions of this Agreement constitute limitations upon such authority, rights, and powers. b) The Union recognizes that the Employer has the right, on its own initiative, to perform any function of management at any time, so long as it does not violate any express provision of this Agreement. c) The following acts are functions of management: 1) Those acts which are not within the area of collective bargaining as required by the National Labor Relations Act; 2) Those acts which are usually exercised by other employers; and 3) Those acts which management should exercise in order to properly manage the business. 2 ARTICLE 2 UNION SECURITY 6 Section 1 a) The COMPANY agrees to honor check-off cards signed by individual employees, on forms agreed to by the COMPANY and the UNION, which authorize the COMPANY to deduct from the employee's first paycheck each month the regular monthly UNION dues of the employee, or initiation fees as may be authorized by the employee. b) The COMPANY agrees to notify the UNION of all newly employed personnel covered by this Agreement. Such notice shall be in writing and shall state the name of the employee, their classification, their date of hire, their address and telephone number. 7 Section 2 a) Check-off authorizations now in effect shall become irrevocable in accordance with the terms of Section 3 of this article unless written notice of revocation from the employee is received by the COMPANY within the fifteen (15) day period prior to the expiration date of this Agreement. A notice of this provision will be posted by the COMPANY and the UNION. 8 Section 3 a) Check-off authorizations shall be irrevocable for the period of one (1) year, or until the termination of the Agreement, whichever occurs sooner. It is further agreed that this authorization shall be automatically renewed, and shall be irrevocable for successive periods of one (1) year each unless written notice by registered mail of revocation from the employee is received by the COMPANY not more than twenty (20) days nor less than ten (10) days prior to the expiration of each period of one (1) year. b) Employees withdrawing from a signatory union may cancel their dues deduction authorization at any time by serving notice by letter to the COMPANY canceling such authorization along with letters of approval from the UNION and the signatory union to which the dues and initiation fees were to be forwarded. c) Employees who, as a result of a change in job assignment, transfer from one signatory union to another signatory union, may cancel any prior dues deduction authorization by submitting to the COMPANY a new dues deduction authorization. Such new authorization must be transmitted through the signatory union or its designated representative. 3 9 Section 4 a) Money deducted from paychecks as authorized herein for employees bargained for by the UNION will be forwarded to each individual union signatory to the Agreement. The UNION will furnish the COMPANY a list of signatory unions showing the address and the individual to whom the check should be forwarded and the regular monthly union dues of each Union. This check will be forwarded not later than the 20th of the month in which the money is deducted, along with a summary sheet in duplicate showing the name of each employee from whose paycheck dues and initiation fees were deducted and the amount deducted. b) In the event a signatory union ceases to be affiliated with UNION for any reason, and UNION officially notifies COMPANY of same, the authorization of employees for deductions of dues and initiation fees for such Union whose affiliation with UNION has ceased, shall be immediately and automatically revoked and any monies deducted from checks of said employees and held by the COMPANY will be refunded to the employee from whose check the deduction was made. 10 Section 5 a) In the event applicable laws governing union security are liberalized to the extent that they allow a Maintenance of Membership clause, the COMPANY agrees to meet with the UNION at that time and agree on the terms of a Maintenance of Membership clause. ARTICLE 3 HOURS OF WORK 11 Section 1 - All Employees in Seniority Groups 1, 2 and 4 a) The period of time from 6:30 a.m. to 6:30 a.m. the following day shall constitute a payroll day for all employees in the seniority groups above. The period of time composed of seven (7) consecutive payroll days, extending from 6:30 a.m. Monday to 6:30 a.m. the following Monday, shall constitute a regular work week at this plant for all employees in the seniority groups above. b) The hours of work shall be as follows: 1) Day Workers - Eight (8) consecutive hours of work per day, exclusive of a thirty (30) minute lunch period, shall constitute a day's work. Hours of work shall be from 6:30 a.m. to 3:00 p.m. Employees will begin their unpaid thirty (30) minute lunch period during a one and a half (1.5) hour window beginning four (4) hours after the start of the shift. If the lunch break starts after the window for work related reasons, the employee will be paid the appropriate overtime rate for the lunch period. 4 2) Eight Hour Shift Workers - Eight (8) consecutive hours of work per day shall constitute a day's work. Five (5) eight (8) hour shifts in any one workweek shall constitute a week's work. Shifts shall normally be from 6:30 a.m. to 2:30 p.m., 2:30 p.m. to 10:30 p.m., and 10:30 p.m. to 6:30 a.m. Shift workers will be permitted sufficient time to eat during their shift without loss of pay for such period. 3) 12-Hour Shift Workers - Terms of the 12-Hour Shift Agreement are included in Exhibit A of this Agreement. 12 Section 2 - All Employees in the Maintenance Crafts Seniority and Seniority Group 3 a) The period of time from 7:30 a.m. to 7:30 a.m. the following day shall constitute a payroll day for all employees in the seniority groups above. b) The period of time composed of seven (7) consecutive payroll days, extending from 7:30 a.m. Monday to 7:30 a.m. the following Monday, shall constitute a regular work week at this plant for all employees in the seniority groups above. c) The hours of work shall be as follows: 1) Day Workers - All Employees in the Maintenance Crafts Seniority and Seniority Group 3 - Eight (8) consecutive hours of work per day, exclusive of a thirty (30) minute lunch period, shall constitute a day's work. Hours of work shall be from 7:30 a.m. to 4:00 p.m. Employees will begin their unpaid thirty (30) minute lunch period during a one and a half (1.5) hour window beginning four (4) hours after the start of the shift. If the lunch break starts after the window for work related reasons, the employee will be paid the appropriate overtime rate for the lunch period. 2) Shift Workers - Maintenance employees assigned to shifts will be permitted sufficient time to eat during their shift work without loss of pay for such period. 13 Section 3 a) Employees may be scheduled as shift workers if and when required in the operation of the plant, and when so working, shall be governed by the above conditions relating to a shift worker. b) Straight day Maintenance employees temporarily assigned to shift work, when being reassigned to straight days, will normally be reassigned at the beginning of the work week. c) Special shift schedules and start/stop times to support non-routine operations, shutdowns, turnarounds and emergency situations will be determined by management after consultation with the UNION. 5 d) The normal workweek shall consist of forty (40) hours of work and the normal workday of eight (8) hours of work providing work is available. e) In the event an employee is inadvertently scheduled for less than the normal workweek, the employee will be allowed to make up the difference after reporting the discrepancy to supervision. The employee will be allowed to make up such difference only to the point where their earnings equal the straight time earnings for a normal workweek. f) An employee may be excused without pay for a period up to three (3) hours at the beginning or end of the day shift, Monday through Friday (except holidays falling Monday through Friday) for the purpose of a doctor or dentist appointment. Such excuse will be granted if it is scheduled with enough advance notice so that proper relief can be scheduled and the absence does not impair plant operations. ARTICLE 4 OVERTIME AND PREMIUM TIME REGULATIONS 14 Section 1 a) An employee shall be paid at the rate of one and one-half (1-1/2) times his regular rate for all hours worked by him in excess of eight (8) in any one (1) day consisting of the twenty-four (24) hour period beginning when an employee begins to work or report for work in accordance with instructions, which ever is earlier. b) An employee shall be paid at the rate of one and one-half (1-1/2) times his regular rate for all hours worked by him in excess of forty (40) in any workweek. c) Time and one-half (1-1/2) shall be paid for the first 8-hour period worked following a change of schedule unless the employee is given at least thirty-six (36) hours notice in advance of the beginning of his newly assigned hours. For the purpose of computing weekly overtime, hours for which premium pay is payable under the provisions of this paragraph will not be counted in the total hours worked by an employee in a given workweek. d) When an employee works a minimum of 8 hours on all their scheduled days of rest within a payroll week, they will be paid for all hours worked on the last day of rest at the rate of two (2) times their base rate of pay. 6 15 Section 2 - Call-outs a) An employee called-out for work with less than 4 hours notice outside his regular schedule shall be paid for the actual time worked at not less than one and one half (1-1/2) times his straight time rate if the length of the assignment is 2.5 hours or greater. If the assignment is less than 2.5 hours in duration and the call- out work does not immediately precede or immediately follow his regularly scheduled work period, he shall receive the equivalent of four hours times his straight time rate. b) The COMPANY shall have the right to institute an on-call system for calling out and contacting employees. 16 Section 3 - Holidays a) Two and one-half times will be paid for work performed on the following holidays: New Year's Day, President's Birthday, Good Friday, Easter Sunday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Friday after Thanksgiving Day, Christmas Eve and Christmas Day. b) FOR DAY WORKERS: If any of these holidays fall on a Sunday, the Monday immediately following shall be recognized as the holiday. If holidays fall on Saturday, they will be observed on the preceding Friday. The exception shall be Christmas Eve, which shall be observed on the last working day before Christmas. c) FOR SHIFT WORKERS: All holidays listed above will be recognized on the calendar day on which it falls. For the purpose of determining pay for an employee who works on a day observed as a holiday which falls on one of the employee's scheduled days of rest, "regular scheduled hours of work" for that day shall mean the same hours the employee was assigned to work on the last regularly scheduled day of work immediately prior to the holiday. Payment will be made according to (d) 1 below. d) Employees will be paid for the holidays listed above not worked an amount equivalent to eight (8) times the employee's straight-time hourly rate, subject to the following conditions: 1) Such pay shall be computed on the basis of payroll day and not calendar day. 2) To be eligible for such pay, an employee must report for work on their last regular scheduled working day immediately preceding the holiday and their first regular scheduled working day immediately following this holiday. 3) For purposes of determining eligibility for holiday pay only under this section, employees absent either the day before, the day after, or both days, because of vacation, death in the immediate family, occupational injury or illness while under a 7 doctor's care, jury duty or excused absence will be considered as having worked on such day or days and will be entitled to holiday pay provided they have complied with the other requirements of Article 4, Section 3. Immediate family will be interpreted to mean those members of the family covered under Article 25 - Funeral Leave. 4) An employee who is instructed to work on a holiday but fails to report will receive no pay for the holiday. 5) Payment for holidays not worked shall not apply to employees on approved leave of absence, off because of sickness or occupational injury (unless under a doctor's care), or layoff. 17 Section 4 a) In the event any hours worked fall within two or more classifications listed above, only one application can be made. 18 Section 5 a) Employees shall not be laid off during regular working hours to deprive them of any time, which they have gained by working overtime. At one (1) week intervals, the COMPANY will make every reasonable effort to post overtime equalization lists in each zone or departments and to distribute such overtime work as equally as practicable. 19 Section 6 - Overtime Meals a) If an employee works more than two hours immediately following his scheduled working period, he shall be provided a meal. The employee will be afforded an opportunity on COMPANY time to eat meals so supplied at the time he is entitled to same, or as soon thereafter as the condition of the work permits. b) Any employee called out (with less than four (4) hours' notice), will be supplied with a suitable meal at the COMPANY'S expense after four (4) hours of work. If the employee continues working on overtime, outside his regular or scheduled shift, he will be furnished a meal every four (4) hours. If the employee works into his scheduled shift, no more meals will be furnished. c) Employees scheduled on overtime, other than provided in (a) or (b) above, will provide their own meals. 8 20 Section 7 - Shift Differential a) Shift differential shall be added to the wage rate of the employees required to work during the shift indicated in the following schedule for each hour worked during such periods: 1) Eight Hour Shift Workers: Days No differential Evenings 50c differential Graveyards $1.00 differential 2) Day Workers Days No differential Evenings 50c differential Graveyards $1.00 differential 3) For shifts longer than 8 hours in duration: Days No differential Nights $1.00 differential 21 Section 8 - Transportation a) The COMPANY will provide rides home for employees who are without transportation and are held over on overtime past their regular scheduled shift. 22 SECTION 9 - BYPASSING a) When an employee has worked sixteen (16) continuous hours and up to or within the employee's regular shift, the employee will be allowed to go home and will be paid at the straight-time for the remaining hours of the employee's regular shift, or the employee may be bypassed for overtime if it will require that he be sent home with pay for his regularly scheduled shift. This decision will be made by supervision. b) The COMPANY agrees that in scheduling overtime, no employee shall be bypassed in the assignment of overtime to work solely to avoid payment of double-time, except as referenced above. c) The "rain-out" clause in the contractor's contract or straight-time work on Saturday, Sunday, or holidays as may be provided under the contractor's contract, will not be used to avoid Sterling employee's overtime. 9 ARTICLE 5 VACATION 23 a) The vacation allowance for employees with less than five years of service shall be eighty (80) hours, in which case vacation credits will be given at a rate of six and two-thirds (6 2/3) hours per month of service for a maximum of eighty (80) hours. Fractional credits shall be figured to the next 8-hour increment. Vacation credits are not accumulative during the probationary period specified in Article 6, Section 2, but after such period the new employee's vacation credits shall be calculated from the date of employment. b) Vacation credits accumulated after January 1st of the current year shall not be taken until January 1st of the following year. Vacation must be taken in full shift increments. c) Each employee who completes five (5) or more years of continuous service will be granted one-hundred twenty (120) hours of vacation per year. Such vacation may be taken at any time during the vacation year in which the employee reaches the fifth (5th) year of continuous service. After receiving a first vacation of one-hundred twenty (120) hours, the employee will accrue ten (10) hours vacation per month of service or a maximum of one-hundred twenty (120) hours per year. d) Each employee who completes ten (10) or more years of continuous service will be granted one-hundred sixty (160) hours of vacation per year. Such vacation may be taken at any time during the vacation year in which the employee reaches the tenth (10th) year of continuous service. After receiving a first vacation of one hundred sixty (160) hours, the employee will accrue thirteen and one-third (13-1/3) hours of vacation per month of service or a maximum of one hundred sixty (160) hours per year. e) Each employee who completes twenty (20) or more years of continuous service will be granted two-hundred (200) hours of vacation per year. Such vacation may be taken at any time during the vacation year in which the employee reaches the twentieth (20th) year of continuous service. After receiving a first vacation of two-hundred (200) hours, the employee will accrue sixteen and two-thirds (16- 2/3) hours of vacation per month of service or a maximum of two- hundred (200) hours per year. f) Each employee who completes thirty (30) or more years of continuous service will be granted two-hundred forty (240) hours of vacation per year. Such vacation may be taken at any time during the vacation year in which the employee reaches the thirtieth (30th) year of continuous service. After receiving a first vacation of two-hundred forty (240) hours, the employee will accrue twenty (20) hours of vacation per month of service or a maximum of two-hundred forty (240) hours per year. g) The vacation pay for employees entitled to vacation is computed on the basis of rate of pay per hour at the time of vacation at straight-time. 10 h) Vacation period shall be from January 1 through December 31 each year. i) The employee with the greatest bargaining unit seniority within the group or craft, wherever possible, shall be allowed preference as to time of vacation within each department and within each maintenance zone. When an employee elects to split their vacation, then they shall be allowed seniority preference only on one (1) portion of the split vacation until all employees have exercised their seniority preference. j) Prior to January 1st, employees shall designate their choices of dates for their vacations and a vacation schedule for the year will be made up in accordance with other provisions of this article. k) An employee may place up to eighty (80) hours (ten days) of their vacation in a vacation bank prior to January 1 with such days to be taken at any time during the vacation year on a first-come basis in an individual operating unit, in a maintenance craft within a zone, or in any other department. Five (5) bank days may be taken with one (1) hour's notice. Twenty-two (22) hours' notice for the other five (5) bank days will be required except in cases of emergencies. All normal requests for bank days must be made to the employee's supervisor. Emergency requests will be subject to approval by the department head or designee. Bank days will be granted only when, in the judgment of the COMPANY, such days do not conflict or impair plant operations. Bank days will be taken in any combination of whole days without restriction by vacation splits. All bank days must be taken during the vacation year and shall not be cumulative. When, in the opinion of the COMPANY, it appears that vacation bank days are accumulating in a group, department or craft and will create a problem near the end of the vacation year, employees will be requested to schedule their remaining bank days in order not to conflict with or impair plant operations. l) Vacation may be split into as many periods as the employee has weeks of vacation. In calculating vacation splits, the bank days will constitute one split. Employees with ten (10) or more years of service will be eligible for one (1) additional split. Vacation schedules established by January 1st will not be altered after this date to give preference to the senior employee. Employees shall be permitted to begin or end their vacations on a regularly scheduled day off. m) Vacations shall be given employees on such dates or as near as may be practicable when, in the judgment of the COMPANY, such dates do not conflict with or impair plant operations. n) Vacation during any vacation period must be taken during the vacation period and shall not be cumulative. o) For the purpose of taking extended vacation, employees with five (5) or more years of service will be permitted, one (1) time during the life of this contract to elect to hold over forty (40) hours of vacation from one (1) vacation period and take it during the next 11 vacation period in conjunction with the full vacation due that vacation period. Employees desiring to exercise this option will so advise the COMPANY during the vacation-scheduling period in the year in which they desire to hold over the forty (40) hours. p) Employees with ten (10) to nineteen (19) years of service have the option to hold over forty (40) hours of vacation from one (l) vacation period and take it during the next vacation period. Employees desiring to exercise this option must notify the COMPANY by November 1st prior to the end of the vacation year in which it was originally expected to be taken. This request does not increase the number of bank days. q) An employee who is "Combo 80" (minimum age 55 with 80 points) or who has at least 20 years of COMPANY service, may carry over from one vacation period to the next up to eighty (80) hours of vacation in forty (40) hour increments. A maximum of two hundred forty (240) hours may be carried over in this manner. r) Any employee leaving the service of the COMPANY entering State or Federal military service shall so notify the COMPANY, and shall be paid the vacation credits earned up to the time of induction. Such employee shall not be taken off the payroll until actually inducted in military service, State or Federal. s) In calculating time for vacation credits, no vacation will accrue after the sixth month of sick leave or otherwise while not actively at work. t) In case an employee is dismissed or leaves the COMPANY'S service voluntarily, they will receive vacation pay to the extent of the credits accumulated at the time of their dismissal or voluntary separation. u) In case an employee resigns without notice or is discharged for cause, they will receive only pay for vacation earned during the previous year but not taken. Such employees will not be eligible to receive vacation accrued in the current vacation year up to the time of their removal from the payroll. v) When a holiday is observed on an employee's scheduled vacation day, they will have the option of an extra day vacation or an extra eight (8) hours' pay at their regular straight-time rate. w) When a day of vacation falls on a holiday and the elects to take an extra day of vacation, they may elect to take it the last working day immediately prior to their scheduled vacation. x) When an employee transfers from one craft or group to another, the employee will carry with them their vacation as scheduled for that year. The transfer of this vacation schedule will not interfere with the rights of any other employee to their vacation as previously scheduled. 12 y) Back-to-back vacations from one vacation year to the next will be allowed under the following conditions: 1) The period of vacation must be for six or more weeks. 2) The employees who desire to schedule vacation in a continuous period beginning in one vacation year and ending in another vacation year must schedule such vacation prior to January 1 of the first vacation year. 3) If, on the basis of seniority, they will be allowed to schedule their vacation immediately prior to the end of the vacation year, then they shall be granted vacation preference for the continuous portion of the vacation, which ends the next vacation year. ARTICLE 6 SENIORITY 24 SECTION 1 - DEFINITIONS a) By the term "seniority" is meant the status of the employee's length of service as such. b) Four types of seniority shall be recognized: 1) GROUP SENIORITY. This shall consist of the seniority accumulated by an employee working in any of the groups listed below. 2) DEPARTMENT SENIORITY. For matters directly affecting any of the departments in Group 1, employees in their respective operating departments shall be listed on the Seniority List by order of Group 1 seniority within their respective department. 3) MAINTENANCE CRAFT SENIORITY. This shall consist of the seniority accumulated by an employee in the particular maintenance craft in which the employee is working. 4) BARGAINING UNIT SENIORITY. This shall consist of seniority accumulated by an employee in any of the groups or crafts listed below. c) For purposes of paragraph (b) above, group, department, and maintenance craft seniority shall cover the following: 13 1) Group Seniority I) GROUP 1 - All hourly employees in the following operating departments and any other which may be added and which are designated as operating departments by the COMPANY, Departments 13/14/15/16, 513, 19/23/25/88, 44/50, 48/56, 51, 53, and POWER. II) GROUP 2 - All hourly employees of the Laboratory. III) GROUP 3 - All hourly employees of the Storeroom. IV) GROUP 4 - All hourly employees of the Materials Handling Department. 2) Department Seniority i) For matters directly affecting departments in Group 1, employees in the various operating departments shall be listed on department seniority lists by Group 1 seniority within their respective departments. Any reference to departmental seniority in other sections of the contract will refer to the Group 1 seniority of employees within the department. 3) Maintenance Craft Seniority i) All hourly employees in each of the maintenance crafts. The maintenance crafts shall include, but shall not be limited to the following titles: Pipefitters Carpenters Asbestos Workers Instrument/Electrical Boilermakers/ Ironworkers Machinists Painters Operating Engineers Laborers 25 Section 2 - Commencement a) All new employees shall be required to work a trial or probationary period of one-hundred thirty-five (135) calendar days continuous service before the seniority rules outlined herein shall apply to them, and after such period, the new employee's seniority shall be retroactive to the date they were employed. b) Straight-day employment shall be determined on the basis of senior qualified. New employees will be required to go on shift within not more than ninety (90) days after employment. 14 c) When employees are hired into a group or craft on the same date, their order on the seniority lists shall be determined by "lot". d) In a situation where departmental seniority is equal, the group seniority shall govern, and when group or craft seniority are equal, seniority on the first day worked in the bargaining unit shall govern. 26 Section 3 - Seniority Lists a) The COMPANY agrees to compile and furnish the UNION a seniority list quarterly, showing the seniority of each employee in bargaining unit, and the COMPANY further agrees that it will add names and the seniority status of all employees to said list after they have completed their probationary period and are considered regular employees. 27 Section 4 - When Seniority Does Not Apply or Is Not Affected a) Seniority privileges shall not apply to probationary employees. b) The Seniority of an employee shall not be affected when they are promoted to a supervisory classification unless they remain in that capacity for a period in excess of one hundred thirty-five (135) calendar days after which time they shall lose their seniority as a member of the bargaining unit. c) The seniority of an employee shall not be affected when they are promoted temporarily to a supervisory classification unless they remain in that capacity for a period in excess of one-hundred and eighty (180) working days in a calendar year, after which time they shall lose their seniority as a member of the bargaining unit. d) Employees, other than temporary employees, who are called into active military service with any branch of the U. S. government, shall not lose their seniority rights or their status with the COMPANY. Such employees, however, shall file an application with the COMPANY for reinstatement, within ninety (90) days after they have received an Honorable Discharge from such service and if their physical and mental condition is satisfactory, such employee shall be reinstated to their former position or one to which their seniority entitles them, unless the COMPANY'S circumstances have so changed as to make it impossible or unreasonable to do so. 28 SECTION 5 - WHEN GROUP, DEPARTMENT, CRAFT AND BARGAINING UNIT SENIORITY IS LOST a) An employee under the following circumstances shall lose all seniority: 1) When the COMPANY discharges them. 2) When they quit the service of the COMPANY of their own volition. 15 3) When they are laid off for a period exceeding eighteen (18) months without being recalled. 4) When an employee overstays their leave of absence without notifying the COMPANY and receiving an extension of time. 29 SECTION 6 - WHEN GROUP, DEPARTMENT, CRAFT, AND BARGAINING UNIT SENIORITY IS NOT BROKEN a) Seniority of the employee shall not be broken because of: (1) layoffs (except as provided in Section 5 a) 3) of this article); (2) authorized leaves of absence; (3) absences on account of occupational or non-occupational sick leave not exceeding a period of twelve (12) months; (4) any cessation of work at the COMPANY'S plant which is beyond the control of the employee not exceeding a period of eighteen (18) months. 30 SECTION 7 - CONSOLIDATION OF DEPARTMENTS a) When two or more departments are consolidated, the employees of these departments may claim seniority in the consolidated department, it being understood, however, that no employee may claim a classification in the consolidated department higher than the one occupied in the department in which the employee was previously employed. 31 SECTION 8 - PROMOTIONS a) When a new vacancy or new job occurs in a department or craft, such vacancy or new job shall be filled from employees within that department or craft. When skill and ability are approximately equal, then the senior qualified employee shall fill the vacancy. If departmental seniority is equal, group seniority shall govern. b) It is understood and agreed, however, that where skill and ability are questioned, a senior employee may request the opportunity to fill such vacancy or new job, in which event, the COMPANY agrees to consult with the UNION concerning the matter. If it is determined that the request has merit, the employee will be given a trial period of thirty (30) working days to prove to the satisfaction of the COMPANY their skill and ability in such position. The above privilege shall not be granted to craft apprentices. 32 SECTION 9 - JOB BIDDING PROCEDURE a) When a permanent vacancy must be filled from outside the group or craft in which the vacancy exists and no layoff exists for such group or craft, then the job will be posted and filled in accordance with the following procedure: 1) JOB POSTING - The job vacancy will be posted for seven (7) calendar days at each of the main gates and on departmental bulletin boards within the plant. 16 2) JOB BIDDING - Each employee who desires to bid for the posted job may do so by going to the Human Resources Department and signing a job bidding form within the seven (7) day period. i.) Any employee who knows that they will be absent from the plant (for reasons such as vacation, jury duty, etc.) may submit to the Human Resources Department a pre-bid indicating those jobs they desire should a vacancy be posted during their absence. The employee submitting a pre- bid will be considered for a vacancy only if their pre-bid is received prior to the seven (7) day period outlined in the job vacancy announcement. Each pre-bid shall be effective only for the duration of the individual's specific absence. B) SELECTION - Posted vacancies will be filled by the qualified bidder with the greatest bargaining unit seniority. Successful bidders will be transferred to their new job within 120 calendar days following the date of notification of successful bid unless the COMPANY demonstrates, subject to the grievance and arbitration provisions of the contract, that to move said successful bidder would create a situation where the employee's job cannot be manned in a safe manner. 1) The successful bidder will enter the new job classification at the appropriate rate as indicated on the job vacancy announcement. 2) The provisions of Section 11 of this Article will apply to employees who are transferred from one group or craft to another in accordance with the job bidding procedure. C) BIDDING RULES - Because of the extended period of training for apprentice plans and the expense involved in such extended training, no employee shall be allowed to transfer to a bona fide apprentice opening if the employee could not, prior to the eligibility for early retirement, complete a number of years that is equal to twice the number of years required for apprentice training. This rule will not apply to members of the class who are presently in a classification with a top rate lower than the top rate of the apprentice crafts or groups. Anyone hired into an apprentice classification must remain, after topping out, in that classification for a period equal to the training period before bidding to another classification. 1) If the COMPANY determines that the senior employee bidding on a posted job is not qualified, the employee may file a grievance contesting such determination at Step 2 of the grievance procedure, which may, if not satisfactorily resolved, be submitted to arbitration in accordance with the arbitration procedure as outlined in Article 28. Nothing contained herein shall interfere with the filling of the vacancy with another employee or with a new hire, pending settlement of a grievance. 17 2) Employees whose bids have been denied on the basis of qualifications will not be considered again for transfer to the same group or craft until they have shown proof that their qualifications now fit the requirements of the job. 3) A successful bidder will not be eligible for another transfer until they have reached the top rate of their classification and served an additional period of time equal to the time required to reach the top rate. 4) A successful bidder who refuses to accept a tendered transfer will not be reconsidered for any other transfer for a period of one (1) year after date of refusal. d) An employee who has been returned to their last previous group or craft for inability to perform work of the new classification as provided in Section 11, Article 6 of the Articles of Agreement will not be considered for any further transfer for a period of one (1) year from the date of return to their last previous group or craft. e) An employee shall be limited to one transfer to a group or craft having a lower top rate or one transfer to group or craft having an equal top rate. Subsequent lateral or downward transfer to another group or craft shall be approved only when in the best interest of the employee and by mutual agreement of COMPANY and UNION. F) NO QUALIFIED BIDDERS - If none of the bidders are qualified for a posted job, or if there are no bidders, the COMPANY shall have the right to fill the job as it sees fit. G) APPRENTICESHIP PROGRAMS: 1) The following criterion will be applied in selecting qualified candidates for COMPANY apprenticeship programs. 2) Operator Apprentice candidates, must have completed three (3) hours of college level math and six (6) hours of college level science with a GPA of 2.5 or better (A = 4.0) prior to being considered. In addition to the above listed requirements, Operator Apprentice candidates must have completed a Junior College Basic Petrochemical Operators course prior to being considered. 3) Instrument/Electrical (combined) and Machinists Apprentice candidates, must have completed six (6) hours of college level math and six (6) hours of college level science with a GPA of 2.5 or better (A = 4.0), or graduate from a two (2) year vocational trade school in the craft applied for with a GPA of 2.5 or better from the school prior to being considered. 18 4) The requirements for Associate Operator candidates include that all candidates must have completed or be an active participant in a State Education Board Certified Associate Degree of Process Technology program prior to being considered for employment. In addition, they must meet the preliminary educational requirements of an Apprentice Operator (math & science courses) as outlined above. The COMPANY will determine the candidate's entry level pay based on their progress in the Associate Degree of Process Technology program as compared to the Merit Pay Progression Scheduled for Chemical Operator Apprentices. 33 SECTION 10 - TRANSFERS a) When surplus Group 1 employees exist in one operating department and openings exist in another, transfers from the surplus department will be on a volunteer-by-seniority basis. Those employees with the most Group 1 seniority in the department being destaffed who wish to transfer out of the department to another operating department will be allowed to volunteer. If not enough employees volunteer to transfer, then the necessary number will be destaffed by moving the junior employee based on Group 1 seniority within the department being destaffed. In either case, the employee may be recalled to their original departments at the COMPANY'S discretion for up to one year from the date of transfer. If employees are recalled to their original departments, those transferred involuntarily will be recalled first, according to Group 1 seniority; those who transferred voluntarily will be recalled in inverse order of Group 1 seniority. b) If an operating unit is shut down or temporarily under reduced operation resulting in an excess of employees in any group, the UNION and the COMPANY will meet and discuss a plan whereby these employees may be put to work so as to prevent layoff. Employees in these groups may be assigned as helpers in maintenance or in other groups. c) A General Mechanic classification is established to increase the skill level of existing Carpenters, Asbestos Workers, Laborers, Painters, and Stores Clerk. All current employees in these classifications are eligible to receive training to qualify for transfer into this classification. d) Stores employees will have the option of transferring to Maintenance as Laborers and become eligible to receive training to qualify as a General Mechanics. e) Stores employees choosing to transfer to Laborers would be paid at the frozen Stores rate of $21.67 until they qualify as a General Mechanic. The Stores Chief Clerk will be frozen at $22.98 until he qualifies as a General Mechanic. f) In the event of a Laborer layoff, Stores employees who chose this transfer will have bump rights back to Stores until such time as there is a Laborer or General Mechanic recall. They will bump back to Stores at the frozen Stores wage rate of $21.67. The Company will select an outside contractor to operate the Stores department. Those 19 Stores employees who choose to not accept the transfer to the Laborers/General Mechanic classification will work composite with contractor employees. Their rights as Sterling bargaining unit employees are not impacted in any way by this Agreement. These employees' wage rate will be frozen at $21.67. 34 SECTION 11 - LAYOFFS a) Layoffs in all groups and maintenance craft departments shall be in inverse order of group, or craft seniority, depending on the need for employees in that particular group or craft, it being understood that in any group or craft the top classification will not be filled by an employee not having both skill and ability and group or craft seniority. b) An employee transferred from one group or craft shall retain seniority in their former group or craft but will not be allowed to exercise their seniority, nor shall the COMPANY be allowed to transfer the employee back to their old group or craft unless the employee is being laid off for reduction in force or because their work performance has been such that the employee would be laid off for inability to perform the work. c) Employees being laid off for reduction in force may exercise the retained seniority in their old group or craft to forestall layoff provided that they meet the current qualification requirements of their previous job. d) An employee being laid off for inability to perform the work prior to reaching top pay in the classification in the group or craft to which they were transferred will be considered to have accumulated seniority in their old group or craft up to the time they were declared unable to perform such work and will be allowed to exercise that seniority in their old group or craft to forestall layoff. An employee transferring to a one rate job will be given a trial period of ninety (90) days and, if unable to perform the work, will be considered to have accrued seniority in their old group or craft during that period. They will be allowed to exercise such seniority in order to forestall layoff. e) Discharge for cause or termination for any reason other than those referred to above will not be reason for the employee to exercise their seniority rights in the old group or craft. 35 SECTION 12 - REHIRING a) Rehiring shall be in inverse order of layoffs. Employees being recalled shall be notified by registered letter, return receipt requested, mailed to the last address on record in the COMPANY'S files. If the COMPANY does not receive a reply to said letter from the employee, within ten (10) days from the date of its delivery as shown on the return receipt, stating that they will return to work within ten (10) days from said delivery date; or, if they fail to so return to work although they have sent such a reply, the next eligible employee will be placed in the vacancy. b) In special cases, an employee, when replying within ten (10) days to the COMPANY'S notice requesting them to return to work, may be given an extension of time by the 20 COMPANY beyond the ten (10) day limit specified above. Failure to so reply or failure to so report to work will abrogate all rehiring and seniority rights on the part of said employee. In case of an emergency, the COMPANY may temporarily fill any vacancy without waiting for any period of time to expire. After the emergency has expired, such vacancies will be filled according to the regular procedure. c) Where the period of recall is in the best judgment of the COMPANY to be less than ninety (90) calendar days, the recalled employees may decline recall and not lose subsequent recall rights. d) If the period of recall is less than a 40 hour work week, the COMPANY is not obliged to recall an employee for such assignment. 36 SECTION 13 - GRIEVANCES a) In all cases where the UNION or the employee claims that the principle of seniority has been violated, such grievance must be taken up within ten (10) days of the alleged violation and shall be handled according to the procedure set out in Article 27 hereof. In the event the employee grieved is not actively working on the day of such violation, the period of limitation shall begin on the day the employee returns to work. ARTICLE 7 SUPERVISORS DOING HOURLY WORK 37 a) Anyone employed by the COMPANY in the capacity of a xxxxxxx or supervisor will be permitted to perform work normally performed by the hourly employees in the plant for the following reasons only: 1) When they are instructing or training employees. 2) When difficulties arise in a department and it is necessary for the supervisor to act for the safety of equipment and personnel. 3) When supervisory or technical personnel are studying or testing operations and equipment. 4) When training technical personnel. 5) When starting new or revised processes or equipment. 6) During shutdowns or startups, if needed. 21 ARTICLE 8 WORK CLASSIFICATIONS - TEMPORARY VACANCIES 38 a) Wage rates for all classifications of work within the bargaining unit shall be mutually agreed to between the COMPANY and the UNION, set forth separately, and attached to this Agreement and marked "Exhibit B". b) In the event there is a shortage of personnel on any one shift in an operating department due to temporary absence, and the vacancy is of a higher classification than that of part of the employees present, the vacancy shall be filled by temporarily reclassifying an employee on the same shift to the higher classification or, if this is not feasible, by holding over or obtaining another employee of the same classification in the same department from another shift. c) If it becomes necessary to fill a temporary vacancy in the lowest classification in a department, the COMPANY may require an employee who has least department seniority in a department to temporarily transfer to the vacancy. This Article shall not prohibit the COMPANY, however, from temporarily transferring an employee who is not junior in department seniority if said employee is agreeable to the temporary transfer. ARTICLE 9 STAFFING OF NEW UNITS 39 a) The COMPANY agrees to consult with the UNION in connection with the staffing of new units or consolidation of departments in the operating section. ARTICLE 10 STEWARDS 40 a) The UNION may designate for each Department in Operations and each craft in Maintenance, a Shop Xxxxxxx who shall call to the attention of the xxxxxxx or supervisor any questions of working conditions that may arise in their department or craft. b) Discussion between the Shop Xxxxxxx and Xxxxxxx and/or the Supervisor shall be at such time and place as not to interfere with work in the department or craft. c) If the Shop Xxxxxxx and Xxxxxxx or Supervisor are unable to agree, the matter will be referred to the department head involved in accordance with procedure for handling grievances as set out in Article 27, it being agreed that the Shop Xxxxxxx shall suffer no loss in pay for acting in that capacity. d) Any employee called in for discussion that might result in disciplinary action or any entry to be made in their personnel file may be permitted to have a Xxxxxxx present. 22 e) One person within the bargaining unit designated by the Business Manager of the UNION may be named to act in the capacity as a Benefits Xxxxxxx for hourly employees. This Xxxxxxx shall be provided with a locked file cabinet in a suitable location within the plant in which to file records and information. All medical, dental, disability, and other benefit forms and associated correspondence presented or received by the COMPANY are confidential and private information and the COMPANY is required to treat it as such. Any confidential records and information sought by the UNION shall be obtained directly from the concerned employee or, with written permission by the employee, from the Human Resources Department. f) Nothing in this agreement shall be construed as preventing any employee so represented from dealing directly with the COMPANY'S Human Resources personnel. ARTICLE 11 CONTRACT WORK 41 a) The COMPANY reserves the right to utilize independent contractors for any purpose, including the performance of any amount of work normally performed by employees in the bargaining unit, provided employees covered by this Agreement are not laid off as a direct or indirect result of such work being contracted out; nor shall any work contracted prevent the recall of employees on the recall list. b) The COMPANY agrees that Sterling Laborers will be afforded the opportunity to displace a contract janitor to avoid layoff with the stipulation that such re-assignment will be at the current rate for janitorial work, not at the Laborer Wage Rate. Employees assigned to the janitorial pool at the time of ratification of this contract will be grandfathered at their current rate of pay for one year. ARTICLE 12 PAY DAY 42 a) All regular employees covered by this Agreement shall be paid in full, once every two weeks on regular paydays established by the COMPANY except that when a holiday falls on a payday, the employees will be paid the day before the holiday. Each employee on paydays shall be provided with an itemized statement of gross earnings and all deductions for any purpose. b) Paychecks may be directly deposited with the financial institution of the employee's choice, if possible, and if the individual bargaining unit employee signs a statement so indicating and holding the COMPANY harmless if their financial institution has not credited their account in a timely manner. c) The COMPANY further agrees that if any questions arise concerning time credited or pay received by an employee, the time cards and other pertinent records will be made available for examination to the employee and the Shop Xxxxxxx. In the event the 23 difficulty cannot be resolved at that time, then the same shall be considered a grievance and handled according to the regular grievance procedure. d) A pay error of less than eight (8) hours pay will be corrected on the next regular paycheck. An error of eight (8) or more hours pay will be corrected via a special make-up check. ARTICLE 13 PHYSICAL EXAMINATIONS 43 a) An applicant for employment, before being hired, must meet certain minimum standards of health and physical fitness. A licensed physician employed by the COMPANY will give the physical examination. b) Periodic examinations of employees will be carried on with the principal idea of helping employees improve their own health condition and to enable COMPANY to guard the health of its employees. c) Employees who become physically unfit to perform one or more of the essential functions of their assigned classification, may be assigned other work, if available, and until, in the opinion of the doctor retained by the COMPANY, the employee is able to resume the work of their designated classification. d) The COMPANY agrees to continue notification and to send a copy of such individual test results to employees who fall outside the normal medical limits and to provide a copy to an employee who comes to the Heath Services Department and requests such information. e) The COMPANY will provide assistance in scheduling appointments for those employees who request it to obtain non-mandatory x-rays as part of their periodic physical examinations. f) When an employee is scheduled for a chest x-ray as part of their physical, the COMPANY will provide for the x-ray to be read by a "B- Reader". For employees in the Insulator Craft, a second x-ray, read by a "B-Reader", will be provided at six (6) month intervals at the request of an insulator. ARTICLE 14 DISCRIMINATIONS 44 a) No members of a signatory union shall be discriminated against, discharged or harassed on account of their activities or interest in their UNION while carrying out in good faith the terms of this Agreement. 24 b) Charges of such discrimination, discharge or harassment, if any, shall be handled according to the regular grievance procedure. c) Whenever a supervisory employee places charges or letters of reprimand on an employee's record, a copy of such charges or letters of reprimand must be furnished to such employee. Any charges or letters of reprimand made against an employee may be referred by the employee to the grievance procedure for handling if the employee feels the charges or letters of reprimand are unfounded or not justified. d) If an employee has gone a period of twenty-four (24) months without receiving a letter of warning or reprimand, no letters issued to the employee previously (except those which involved disciplinary suspension) will be used for the purpose of further disciplinary action. Disciplinary suspension will be limited to five (5) years for the purpose of further disciplinary action. ARTICLE 15 UNION REPRESENTATIVES 45 a) When in the opinion of a Xxxxxxx or Plant Committeeman, or the COMPANY, the counsel of a business representative of the Texas City, Texas Metal Trades Council, or any of the organizations signatory to this Agreement, is advisable or necessary to aid in the resolving of a grievance that has arisen, such business representative shall be permitted to enter the premises of the COMPANY, subject to the regulations governing visitors to this plant. ARTICLE 16 JURY SERVICE 46 Employees kept away from work because of reporting for jury service or for service as a witness under court subpoena will be paid their regular straight-time hourly rate, exclusive of any overtime or other premium pay, subject to the following provisions. 47 SECTION 1 - MORNING COURT APPEARANCE a) Employees working days are not required to report back for work if dismissed from court duty at or after 12:00 p.m. Employees dismissed before 12:00 p.m. are required to report for work and complete the workday. b) Employees on the 10:30 p.m. to 6:30 a.m. (or 11:30 p.m. to 7:30 a.m.) shift shall not be required to work the shift on the calendar day of their first day in court, nor any other 10:30 p.m. to 6:30 a.m. (11:30 p.m. to 7:30 a.m.) shift falling on a day they are scheduled to be in court. 25 c) Employees scheduled to work the 2:30 p.m. to 10:30 p.m. or 3:30 p.m. to 11:30 p.m. shift are not required to report for their shift if they are released from court after 10:00 a.m. d) Employees scheduled to work the 10:30 p.m. to 6:30 a.m. (or 11:30 p.m. to 7:30 a.m.) shifts are not required to report for work on these shifts if dismissed from court duty at or after 12:00 p.m. If released before noon, they are expected to work their scheduled shifts. 48 SECTION 2 - AFTERNOON COURT APPEARANCE a) Employees working days are required to report for work at the beginning of their shift and will be released a reasonable period of time prior to their court appearance. b) Employees scheduled to work the 2:30 p.m. to 10:30 p.m. (or 3:30 p.m. to 11:30 p.m.) shift are not required to report for work prior to an appearance in court which begins after the start of their scheduled shift and before 6:30 p.m. Employees scheduled to work the 2:30 to 10:30 p.m. (or 3:30 p.m. to 11:30 p.m.) shift who serve three (3) or more hours in court or who are dismissed from court at or after 6:30 p.m. are not required to work the remainder of their scheduled shift on that payroll day. c) Employees scheduled to work the 10:30 p.m. to 6:30 a.m. (or 11:30 p.m. to 7:30 a.m.) shift whose court appearance begins before 3:00 p.m. are not required to work their graveyard shift on that calendar day. Employees scheduled to work the 10:30 p.m. to 6:30 a.m. (or 11:30 p.m. to 7:30 a.m.) shift are not required to work the shift falling on the payroll day of an appearance in court if released from court at or after 3:00 p.m. 49 SECTION 3 a) Employees are required to furnish proof from the court of such service, showing the date and time served and amount paid for their services. With regard to jury service, the COMPANY agrees to treat the documented release time the same for standby as for court appearances. 50 SECTION 4 a) An employee who is to report for court duty in the afternoon shall be given a reasonable period of time to go home, change clothes, etc., eat and then drive to the courthouse for duty; or that an employee released from court duty before 12:00 p.m. shall be given reasonable time to go home, change clothes, eat and drive to the plant. 26 ARTICLE 17 ELECTION DAY REGULATIONS 51 a) It is further agreed that arrangements shall be made so that all employees working days or day shifts who are requested to work overtime, shall have sufficient time off to vote on election days covering City, State, and National elections, and such time off shall not be deducted from the employee's wage. b) An employee appointed as an election judge or observer or those elected as delegates to political conventions shall be granted (a) vacation bank days if eligible; or (b) an excused absence. The request must be made in advance and must not conflict with or impair plant operation. ARTICLE 18 REPLACEMENT OF CLOTHING 52 a) Any employee required to perform work which results in the damage to clothes or shoes by chemical or fire action, to such an extent they are no longer suitable for wear, shall be furnished with suitable clothing or be given a cash replacement allowance; reimbursement is to be at replacement cost less depreciation for normal wear. Replacement cost shall mean the cost to replace the clothing at the time it is ruined. b) All employees required to perform work which results in damage to clothes and shoes by chemical or fire action will be furnished proper protective clothing and equipment which is appropriate under the conditions prevailing. All such clothing and equipment shall be returned, as directed by the COMPANY, at the completion of an assignment or shift, whichever is applicable. ARTICLE 19 LAYOFF NOTICE - SEPARATION ALLOWANCE 53 a) Whenever it is necessary to lay off an employee or employees because of lack of work due to curtailment of production, process changes, changing requirements of craft work, or any other reason beyond control of the COMPANY, such employee or employees shall be given ten (10) working days' notice of such layoff. The COMPANY shall have the option of paying for their time in lieu of notice. b) In the event of a hurricane evacuation, acts of God or other situations beyond the reasonable and direct control of the COMPANY, the notice provisions of this Article will not apply. 27 c) If it is necessary to lay off employees because of any labor dispute preventing normal operations of the plant, three (3) calendar days' notice will be given. The COMPANY shall have the option of paying for this time in lieu of notice. d) Hourly paid employees, who are laid off as a result of economic curtailment, will be eligible for a separation allowance in keeping with the following provisions: 54 SECTION 1 - MODE OF COMPENSATION a) The Separation Allowance is computed on the basis of years of continuous service with the COMPANY. Continuous service for the purpose of this agreement is defined as time spent working for the COMPANY computed from the employee's last date of hire. The maximum allowance for any given period of layoff shall be as follows: ALLOWANCE SCHEDULE YEARS OF CONTINUOUS SERVICE PAY ALLOWANCE --------------------------- ------------- Under 1 year 2 weeks 1 through 4 4 weeks 5 through 9 8 weeks 10 or more 12 weeks plus 1/2 week for each year in excess of 10 55 SECTION 2 - METHOD OF PAYMENT a) The Separation Allowance will be paid in bi-weekly installments at their regular bi-weekly pay amount until the maximum allowance specified above is reached, provided the employee continues to meet the eligibility requirements. b) Should an employee be recalled to active employment before exhausting this maximum allowance, payments will cease as of the effective date of recall. Any remaining balance will be available for payment in the event the employee is subsequently laid off before meeting the full reinstatement requirement specified below. However, in the event the employee meets the requirements for full allowance reinstatement, the payments will not exceed those specified in (1) above. c) Any employee who is recalled to regular active employment after exhausting the maximum allowance payments will be ineligible for further separation payments until they have completed 78 continuous weeks of active employment, at which time they will again become eligible for full benefits under (1) above. d) All monies paid as Separation Allowance will be subject to applicable taxes and other required withholdings. 28 56 SECTION 3 - ELIGIBILITY a) Separation Allowance is not payable to any employee who: 1) Resigns or abandons employment for any reason. 2) Becomes deceased. 3) Elects normal or early retirement. 4) Is discharged. 5) Accepts a position in Sterling that is not within this bargaining unit. 6) Is receiving either occupational or non-occupational disability benefits until said benefits are exhausted, and only then, provided the employee is still on layoff status. 7) Receives total and permanent (Long-Term Disability) disability benefits. 8) Is recalled from layoff. 9) Is offered a position with an acquiring company, of equivalent pay and benefits at the Texas City Plant. b) The above Separation Allowance shall not be paid in the event that the lack of work is due to a labor dispute or to fire, flood, water, or power failure, or other act of God. ARTICLE 20 LEAVE OF ABSENCE 57 a) The COMPANY shall grant leave of absence, up to ninety (90) days length, for personal reasons upon request and explanation by the employee, provided that, in the opinion of the COMPANY, the reason for the request is worthy and such leave shall not be used, except with the permission of the COMPANY, for the purpose of accepting other employment and such leave shall not affect the seniority status of said employee and/or employees. b) The COMPANY shall, upon at least ten (10) days notice given by the UNION, grant leaves of absence not to exceed thirty (30) days, to employees to attend UNION conventions or meetings, provided not more than a total of three (3) employees from the plant or one (1) employee from a department shall be away for that purpose at any one time. 29 c) The COMPANY shall, upon at least two (2) weeks notice given by the UNION, grant leaves of absence not to exceed one (1) year in length to a maximum of two (2) employees during any one period for purposes of accepting employment with a union signatory to this Agreement. Employees on such leaves of absence will maintain their seniority status while on leave providing they maintain continuous service with said union. Such leaves of absence will be automatically extended on a year-by-year basis for the duration of the Agreement, upon receipt by the COMPANY, of a written request from the UNION at least two (2) weeks prior to the expiration of each one (1) year period. Employees desiring to return from such leaves will give the COMPANY at least two (2) weeks notice in writing, and upon return will be required to take a pre-employment physical as if they were new employees. d) A pregnant employee who is not disabled, as defined in Article 30 of this Agreement, may request leave of absence without pay. Said request may cover periods prior to and/or following disability for pregnancy. These requests will normally be granted for periods not exceeding three (3) months after the term of pregnancy. e) Employees elected or appointed to public office will be allowed an excused absence, without pay, providing their absences do not create a cost to the Company or impair normal operations. ARTICLE 21 SANITATION AND SAFETY 58 a) Operating Engineers (Local 450), and other employees who, in order to perform their normal duties, are required by state law to possess either a commercial or chauffeur's license shall be reimbursed the cost of these licenses. b) The COMPANY agrees to provide one pair of colored prescription safety glasses for Operating Engineers required to operate hoisting equipment. The parties recognize that this is a unique requirement for that craft and that such provision is not intended to be the beginning of a colored safety glass program for other groups. c) Inspection of any job for safety purpose may be secured upon the request of any employee assigned to that job; such inspection to be made by the Plant Safety Engineer or other supervision with the employee involved. If the result of this inspection indicates an unsafe condition, the job will be postponed until proper steps have been taken to remedy the condition unless, in the opinion of the supervisor, postponing the job creates a greater hazard. d) When an employee accompanies an OSHA representative, while on COMPANY time during an in-plant investigation, said employee shall not suffer any loss of pay. 30 59 PRESCRIPTION SAFETY GLASSES - a) The COMPANY agrees to pay up to seventy-five dollars ($75.00) applicable to the lenses for one pair of prescription safety glasses purchased through the Safety Department. Such glasses may be tinted or clear. Where the employee's prescription is from a licensed physician and states that the employee's eye condition makes it mandatory that they wear dark glasses during daylight hours, the COMPANY will agree to pay up to and additional seventy-five dollar ($75.00) for the purchase of an additional pair of shaded glasses. It is also understood that the COMPANY will pay up to seventy-five dollars ($75.00) applicable to the lenses for the purchase of new safety glasses when an employee's prescription is changed. b) The Company will pay 100% for the initial eye exam from an approved provider. The Company will pay 75% for subsequent eye exams in two (2) year intervals from an approved provider. c) Additionally, up to two (2) pair of non-prescription safety sunglasses will be provided each year from an approved list. d) The Company payment toward frames for prescription safety glasses is $25.00. e) The COMPANY agrees to provide two (2) pair of prescription glasses for welders. At the time of ordering, two pair will be ordered. One pair will be provided the welder and the second pair will be kept in the Safety Department for issue to the welder when needed. At the time the first pair is turned in and the second pair issued, a new pair will be ordered unless it is time for the employee's eyes to be checked. f) Up to two pairs of clip-on glasses per year shall be furnished by the COMPANY to the Operating Engineers, Local 450 members only. Clip-on glasses may be purchased at cost by other employees at the Safety Supply section. Additionally, the COMPANY agrees to provide one pair of colored prescription safety glasses for Operating Engineers required to operate hoisting equipment. 60 SAFETY SHOES - a) The COMPANY will provide to each bargaining unit employee two (2) pairs of approved chemical resistant safety shoes per contract year. The COMPANY will pay 100% of the cost of these safety shoes. Where the employee wishes to purchase other chemical resistant safety shoes at authorized stores, they may do so. However, the employee will pay the additional cost above $75.00. 31 ARTICLE 22 BULLETIN BOARDS 61 a) It is further agreed that the COMPANY shall provide bulletin boards in locations to be agreed upon between the Plant/Union Committee and the COMPANY for the posting of UNION notices. The board shall be covered with glass and under lock, the key of which shall remain in the possession of a UNION representative. These boards shall be used for the display of the following notices: UNION meetings, UNION appointments, UNION elections, and UNION social affairs. Any and all other notices to be posted on said boards must first have the approval of the Plant Manager or his designee. It is agreed that no UNION matter of any kind shall be posted in and about the plant except on said boards. ARTICLE 23 COMPANY RULES 62 a) It is further agreed by both parties to this Agreement that fair treatment, good service, and due diligence in observance of the rules as promulgated by the COMPANY are essential to the maintenance of satisfactory working conditions and wages described in this Agreement and for efficient production provided that such rules as may be promulgated by the COMPANY shall not in any way conflict with the terms of this Agreement. ARTICLE 24 PRODUCTIVITY STATEMENT 63 a) The COMPANY and the Texas City Metal Trades Council agree that a profitable and highly competitive Texas City plant enhances the job security of all plant employees. Both parties recognize the necessity of making productivity improvements to ensure the future profitability and competitiveness of the plant. b) While acknowledging their respective rights and obligations, the COMPANY and the UNION further recognize that in today's rapidly changing business environment a cooperative versus a confrontational approach to labor relations matters is vital to the plant's success. Specifically, the parties have endorsed the following principles to reinforce their emphasis on this productive collaboration: 1) A working environment that fosters increased effectiveness, efficiency and productivity of plant operations is a highly desirable goal all employees should contribute to achieving. 2) Timely, effective two-way communications are basic to productive plant operations. 32 3) As appropriate, problem solving groups, as well as participative concepts such as quality circles, may be facilitated. Productivity improvement plans, programs and results will be periodically reviewed with the Plant Union Committee. c) The COMPANY and the UNION recognize that it is desirable and mutually beneficial to set up an annual meeting to review Work Practices vs. Best of Class in Industry. The purpose of these meetings would be to identify possible areas of improvement that could enhance the Company's competitiveness within the industry. d) During such meetings, possible areas of improvement identified which would require modifying, amending, or waiving any of the provisions of this Labor Agreement shall be implemented only by mutual consent of both the COMPANY and the UNION. ARTICLE 25 FUNERAL LEAVE 64 a) Employees with ninety (90) days of continuous service will be given a three (3) day leave of absence to attend the funeral of their spouse, child, parent, brother, sister, parent-in-law, brother-in- law, sister-in-law, son-in-law, daughter-in-law, grandparent, grandchild, stepchild, stepmother, stepfather, or spouse's grandparent. These shall be three (3) consecutive calendar days, one (1) of which must be the day of the funeral. Employees will be paid for any such days lost from work at their regular straight-time hourly rate, exclusive of any overtime or other premium pay, provided such are their regularly-scheduled work days. No employee shall receive funeral leave pay for any day that is not a regularly- scheduled workday nor for any day on which they are absent from work or on leave for any other purpose. b) Upon the death of a relative of an employee or employee's spouse where said relative has been a long term resident of the employee's household immediately prior to death and/or confinement to a health facility, funeral leave provisions shall apply the same as that which applies to the death of a person defined above within the immediate family. c) The COMPANY agrees that when a death in an employee's immediate family, as defined above, occurs while the employee is on vacation, the employee, with sufficient notice to the COMPANY may stop their vacation and start their funeral leave in accordance with this article. d) An employee absent from their regular work schedule due to the imminent death of a listed relative may receive funeral leave provided such lost time occurs within the three-day period selected by the employee as funeral leave under this article. e) The COMPANY agrees to double the allotted Funeral Leave when two or more listed family members die concurrently. 33 f) Upon return to work, employees shall complete and sign a COMPANY "Funeral Leave Pay" form and submit satisfactory proof of relationship to the deceased and of actual attendance at the funeral. g) An employee will be excused without the loss of straight time earnings to serve as an active pallbearer on the day of the funeral of an employee or retired employee of the Texas City Plant. The request for the employee to serve must be from a member of the deceased employee's immediate family and no more than six (6) employees may be excused for such pallbearer service at any one funeral. Where the employee or employees to be excused would result in the impairment of plant operations, the COMPANY reserves the right to limit the number of employees absent. ARTICLE 26 STRIKES AND LOCKOUTS 65 a) All members of the UNION agree to conform to the rules and regulations of the COMPANY insofar as they do not violate the conditions of these Articles of Agreement. No member of the UNION employed by the COMPANY shall be discriminated against for upholding UNION principles not inconsistent with the terms of this Agreement. The COMPANY and the UNION desire that production shall continue without interruptions. The COMPANY and the UNION further agree that good employer/employee relations cannot exist unless there is a serious effort on the part of both the COMPANY and the UNION to settle in a peaceable manner all disputes that may arise. Therefore, as a means of promoting continued production and employment and improved employer/employee relationships, the COMPANY and the UNION agree that the grievance procedure and arbitration procedure provided in this Contract shall be used to peaceably settle without strike disputes that are covered by such grievance and arbitration procedure. b) It is agreed that there will be no lockout by the COMPANY or strike or work stoppage by the UNION. c) In the event of such strike or work stoppage, there shall be no liability on the part of the UNION, its officers or agents, if such strike or work stoppage was not authorized, encouraged or condoned by the UNION. d) The UNION agrees to cooperate with the COMPANY and use means at its disposal to settle such strike or work stoppage and request such employees to return to work. e) This provision shall no longer be binding on the COMPANY or the UNION if either party has served proper notice requesting changes or modifications of this Agreement in accordance with the terms of Article 32 and either party has given written notice that is discontinuing negotiations. 34 ARTICLE 27 GRIEVANCE PROCEDURE 66 a) The parties to this Agreement agree that any dispute, complaints, or grievance, except those pertaining to discharge, arising out of the interpretation or application of the terms of this Agreement, shall be settled promptly in accordance with the following procedure: 1) It is understood and agreed that no complaint, dispute, or grievance shall be submitted to either the COMPANY or UNION AFTER A LAPSE OF TEN (10) DAYS FROM THE TIME THE INCIDENT causing the complaint, dispute, or grievance shall have occurred or become known to the employee. 2) STEP 1 - Any employee or group of employees either individually or with, or through, their Xxxxxxx, may discuss with the immediate supervisor any complaint or other matter which they feel requires clarification. The supervisor shall have five (5) days in which to render a verbal decision to said employee(s) and the Xxxxxxx involved, if any. Should the decision fail to bring about a satisfactory settlement in the matter, it may become a grievance and may be handled in accordance with Step 2. i) It is understood that when a group of employees desire a clarification on a matter in which they are commonly involved, one employee in the group, with or through the xxxxxxx, if desired, shall be designated by the group to discuss the matter with the supervisor. Matters which do not affect the employees as a group in a common manner, or which may require individual adjustment, shall be presented on an individual basis. 3) STEP 2 - Within five (5) days of receipt of the verbal decision at Step 1, the employee or group of employees, either individually or through their xxxxxxx, may file the grievance, on forms provided by the COMPANY and the UNION, through the immediate supervisor to their department head. Within five (5) days of receipt of the grievance, the department's supervision, and a representative of the Human Resources Department shall meet with the employee, their xxxxxxx, the appropriate Plant/Union Committeeman and the Business Manager of the UNION or designee, for the purpose of discussing the grievance. Supervision shall have five (5) days in which to render a decision. If the decision brings about a satisfactory settlement of the matter, it shall be reduced to writing and shall be delivered to the employee, the xxxxxxx and the UNION. i) If the decision fails to bring about a satisfactory settlement, it may be appealed in writing to the Plant Manager or designee, within ten (10) days of the decision and will be handled in accordance with Step 3. 35 4) STEP 3 - A grievance appealed to Step 3 will be entered on the agenda of the next meeting of the Plant/Union and the Plant Management Committees if the appeal is received at least ten (10) days prior to its scheduled meeting. If received within the ten (10) day period prior to a meeting, it shall be placed on the agenda for the following meeting. 5) An employee having a grievance in regard to contractual sick pay benefits may file a grievance directly with the Human Resources Department, who shall have five (5) days' time in which to investigate and answer the grievance. Should the answer fail to bring about a satisfactory settlement to the grievance, then the employee may, within five (5) days, appeal the grievance directly to Step 3 of the grievance procedure. 6) After discussion of the grievance by the Plant/Union and Plant Management Committees, it shall be answered, in writing, to the UNION within ten (10) days. If the grievance is settled at Step 3, the answer shall reflect the settlement. If the grievance has not been settled, then the COMPANY'S answer shall state why the grievance is denied. b) The COMPANY and the UNION recognize that is desirable and mutually beneficial to have regular monthly meetings for the purpose of discussing any grievances placed on the agenda for the respective meeting. For this purpose, the representatives of the UNION shall consist of a committee designated by the UNION and shall be called the Plant/Union Committee (PUC), of which there shall be nine (9) employee members. Employees in the probationary period of employment shall not be eligible for membership on the PUC. Membership on the PUC shall consist of four (4) members of the primary maintenance crafts, one (1) member from the General Mechanic/Support skills and four (4) members from operations. c) If an employee is discharged, the COMPANY, within three (3) days of the discharge, shall, on request of the employee provide the employee with a written statement of the reason or reasons for the action taken. If the UNION desires to protest the discharge, the UNION, instead of following the procedure set forth in Steps 1 and 2 of the Article, may, within ten (10) days after the discharge in question, file directly with the COMPANY, a written request for a hearing. Such hearing shall be held within two (2) days after receipt by the COMPANY of such written request. At such hearing, evidence may be presented on behalf of the one discharged and by the COMPANY. 36 d) If the evidence presented by the UNION to the COMPANY warrants the reinstatement of the discharged employee or employees, such reinstatement shall be to their former position without loss of seniority or vacation credits. All other terms of the reinstatement may be agreed upon between the COMPANY and the UNION at this time. If the COMPANY and the UNION cannot agree that the discharge was justified, the dispute may be referred to arbitration in accordance with the procedure set forth below. e) If a grievance or discharge protest cannot be settled to the mutual satisfaction of the COMPANY and UNION in Steps 1 through 3 or as otherwise provided above, the UNION shall have forty-five (45) days during which to notify the COMPANY of their desire to arbitrate the dispute. f) All time limits noted in this Article are exclusive of Saturdays, Sundays and holidays. Extensions of time limits as set forth in this Article, may be requested by either the COMPANY or the UNION to take care of unusual cases. ARTICLE 28 ARBITRATION PROCEDURE 67 a) If a grievance has not been settled to the mutual satisfaction of the COMPANY and Union after completing Step 3 of the grievance procedure provided above, the UNION shall have forty-five (45) days during which to notify the COMPANY of their desire to arbitrate the dispute. A panel of five (5) neutral arbitrators shall be requested in writing from the Federal Mediation and Conciliation Service (FMCS), a copy of such letter will be given to the other party. Upon receipt of the panel of arbitrators, the parties shall alternately strike same, with the first strike determined by flip of a coin. b) Grievances appealed to arbitration but not scheduled for hearing within 12 months of the appeal are considered to be dropped. c) The COMPANY and the UNION shall bear the expenses of their respective advocates. All other expenses of the arbitration shall be borne by and divided equally between the UNION and the COMPANY. d) The arbitrator selected shall have no power or authority to amend, alter or modify this Agreement, including any appendices hereto, but shall be limited to deciding whether or not a violation of its express terms has been committed. The decision of the arbitrator shall be final, conclusive and binding upon all employees, the UNION and the COMPANY. The arbitrator shall have no power to establish wage scales, rates for new jobs, or to change any wage. He shall have no power to substitute his discretion for that of the COMPANY in cases where the COMPANY has retained discretion or the right to act under this Agreement. The arbitrator shall, in his decision, specify whether or not the decision is retroactive or the effective date thereof. 37 e) Time limits: If the UNION or Grievant fails to observe the time limits set forth in the Grievance or Arbitration Procedures, the grievance shall be considered closed and no further proceeding thereon shall lie. If the COMPANY fails to meet the time limits set forth, the grievance may be appealed to the next step of the grievance or arbitration procedures. ARTICLE 29 ABROGATION OF CONTRACT ARTICLES 68 Should any part hereof, or any provisions herein contained, be rendered or declared invalid by reason of any existing or subsequently enacted legislation or by a decree of a court of competent jurisdiction, such invalidation of such part or portion of this Agreement shall not invalidate the remaining portion hereof and they shall remain in full force and effect. ARTICLE 30 OCCUPATIONAL & NON-OCCUPATIONAL ACCIDENT AND SICKNESS PLAN 69 SECTION 1 a) This Benefit Plan is provided to aid employees in meeting their expenses while suffering from an illness or accident in accordance with the following schedule: MAXIMUM NUMBER Plant Service Credit OF WEEKS BENEFIT -------------------- ---------------- Six months to 1 year 12 weeks Over 1 year 26 weeks b) Plant Service Credit shall mean employment with the COMPANY, which is credited to the employee from the records of the COMPANY and shall start with the employee's hiring date with the COMPANY. No credit shall be given for absence due to leave of absence, layoff or strikes. 70 SECTION 2 a) Maximum Number of Weeks Benefits is determined by the employee's Plant Service Credit, and all disability periods occurring within the Plant Service Credit year will be totaled for the purpose of computing the Maximum Benefits allowed for that year. b) Unused benefits during a Plant Service Credit year may not be carried over to the next Plant Service Credit year. 38 c) An employee whose continuous absence due to an illness or injury extends from one (1) service year to another shall be entitled to a maximum of twenty-six (26) weeks benefits for that disability. An employee whose continuous absence exceeds such Maximum Benefits must return to work for a period of sixty (60) days for a related disability or one (1) day for an unrelated disability in order to receive further benefits to which they may be entitled. Total benefits will not exceed twenty-six (26) weeks in a Plant Service Credit year. 71 SECTION 3 a) The Plan provides benefits based on a normal workweek of forty (40) hours and a normal day of eight (8) hours. In case the number of hours in the normal workweek or workday is changed, the benefits listed below will be changed in direct proportion to the change in the scheduled working hours. b) The benefits provided for herein shall be less any amount or amounts of disability benefits which may be provided for through the State or Federal legislation, Workers Compensation, or benefits provided in the Hourly Disability Benefit Plan. 72 SECTION 4 a) This Benefit Plan will provide benefit payments based on the employee's base hourly rate, exclusive of all premium pay. Benefit payments will be made for an employee's disability for each scheduled workday up to the maximum number of weeks for which the employee is eligible according to the schedule in Section 1. b) The COMPANY will provide benefits in an amount equal to 90% of an employee's base straight-time earnings for workdays lost due to non- occupational disability and up to 100% of an employee's base straight-time earnings for workdays lost due to occupational disability. c) An employee who has completed the probationary period but has less than six (6) month's service and otherwise is qualified for benefits from this Plan on a holiday will be guaranteed up to eight (8) hours pay. 73 SECTION 5 a) An employee must present evidence satisfactory to the COMPANY, showing that an absence is due to illness or accident within the meaning of this Plan on forms provided by the COMPANY. b) The employee, the doctor, or a member of the family must report an employee's absence to the Health Services Department by the third day of absence. Failure to comply will be considered an absence without leave. 39 c) Additionally, an employee's occupational injury or illness must be reported to supervision as soon as it becomes known to the employee or it will be considered a late report and subject to disciplinary action. d) Employees must adopt such remedial measures as may be commensurate with their disability and permit such reasonable examinations and inquiries by the COMPANY'S Health Services Department representative as, in its judgment, may be necessary to ascertain the employee's condition. 74 SECTION 6 a) Payments will not be made for: 1) Any period of disability during which the employee is not under treatment by a licensed physician or a licensed chiropractor. 2) Any disability caused directly or indirectly by war or riot. 3) Any sickness or injury due to the employee's i) Willful intention to injure oneself or another; ii) Intoxication or the use of drugs except when in an EAP approved treatment program for substance abuse. 4) Any disability occurring while the employee is working for wages or profit. 5) Any disability due to misconduct. 6) Any disability when an employee is absent because of layoffs, strikes, or leave of absence or on vacation. Any employee who is injured or becomes sick during vacation and is unable to return to work at the end of the vacation shall qualify for benefits in accordance with the Plan. b) All benefits under this plan shall cease immediately when employment with the COMPANY is terminated for any reason. 75 SECTION 7 a) The COMPANY reserves the right to withhold benefit payments to any employee who is guilty of submitting a false claim or of abuse of the privileges covered and may take disciplinary action including discharge. 40 76 SECTION 8 a) Employees receiving sick benefits under this Article at the time a work stoppage occurs will continue to be covered under this Article until certified able to return to work. Employees whose illness or injury occurs after a work stoppage begins will not receive benefits, as set forth in this Article, until the settlement of the work stoppage. 77 SECTION 9 a) The COMPANY agrees that when an employee becomes ill or is injured while on vacation and is certified as disabled by a licensed physician, they will be able to cancel subsequent full weeks of vacation beyond the week in which they become certified as disabled upon proper notification to the COMPANY. b) The COMPANY agrees that if an employee is hospitalized while on vacation, the employee's vacation may be canceled and the employee placed on sick leave on the day of hospitalization. For purposes of this paragraph, the day is defined as the payroll day appropriate to the employee's regular work schedule. ARTICLE 31 WORK ASSIGNMENTS 78 a) There is no jurisdiction. Work will be assigned on the basis of skill and ability taking into account that the needed skills will be represented. b) Bargaining Unit employees will not be required to train non-Sterling personnel. c) The Reliability Based Maintenance (RBM) Analyst assignment and selection process will continue per the 1994 Agreement. ARTICLE 32 CONTRACT PERIOD 79 a) This agreement shall become effective on the date of signing and shall remain in effect until 4:00 p.m. May 1, 2002, and the same shall automatically renew itself from year to year thereafter unless either party shall have given the other written notice of desired changes or termination at least sixty (60) days before the anniversary date. 41 b) This Agreement is in full settlement of all contractual issues in dispute between the COMPANY and the UNION. The parties acknowledge that during the negotiations which resulted in this Agreement, each had the unlimited right and opportunity to make demands and proposals with respect to any subject or matter not removed by law from the area of collective bargaining, and that the understanding and agreements arrived at by the parties after the exercise of that right and opportunity are set forth in this Agreement. c) The COMPANY and UNION also agree that any subsequent agreement reached within the duration of this Agreement will be in compliance with applicable Federal laws, regulations, guidelines and standards. 42 80 Contract Period: December 18, 1998 to May 1, 2002 STERLING CHEMICALS, INC. /s/ Xxxxxx Tuybig -------------------------------------------- Plant Manager /s/ Xxxxx X. Xxxxxxx -------------------------------------------- Human Resources Manager TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO /s/ [SIGNATURE APPEARS HERE] -------------------------------------------- President /s/ Xxx X. Xxxxxxxx -------------------------------------------- Business Manager ELECTRICAL WORKERS LOCAL NO. 527 By /s/ Xxx Marublo ------------------------------------------ OPERATING ENGINEERS NO. 347 By /s/ Xxx X. Xxxxxxxx ------------------------------------------ PAINTERS & PAPERHANGERS NO 1008 By /s/ X. X. Xxxx ------------------------------------------ BRIDGE, STRUCTURAL, ORNAMENTAL & REINFORCING IRON WORKERS NO. 135 By /s/ [Signature Appears Here] ------------------------------------------ INTERNATIONAL ASSOCIATION OF MACHINISTS NO. 1446, AFFILIATED WITH DISTRICT NO. 37 By /s/ [Signature Appears Here] ------------------------------------------ SHEET METAL WORKERS NO. 54 By /s/ Xxxxxx X. Xxxxxxxxx ------------------------------------------ 43 Contract Period: December 18, 1998 to May 1, 2002 TEAMSTERS LOCAL NO. 968. By ------------------------------------------ CARPENTERS LOCAL NO. 973 By /s/ [SIGNATURE APPEARS HERE] ------------------------------------------ INSTRUMENT LODGE NO. 903 By ------------------------------------------ INTERNATIONAL BROTHERHOOD OF BOILERMAKERS IRON SHIP BUILDERS, BLACKSMITHS, FORGERS AND HELPERS NO. 132 By ------------------------------------------ PIPEFITTERS LOCAL NO. 211 By ------------------------------------------ OPERATING ENGINEERS NO. 450 By /s/ Xxxxxx Xxxx ------------------------------------------ 44 EXHIBIT A TWELVE-HOUR SHIFT AGREEMENT 45 This Agreement is applicable to Groups 1, 2, and 4 employees assigned to the 12H Shift Schedule (designated 12H). In addition, only those Articles, Appendices and Letters of Understanding specifically cited herein are modified by this Agreement. Those provisions in the basic agreement not addressed here remain effective for all employees affected by this Agreement as well as all other represented employees. The COMPANY will not relinquish its rights to determine hours and schedules of work except as specifically limited in the Articles of Agreement. It is expressly provided, however, that the COMPANY for legitimate business cause, may cause the discontinuance of the use of the 12H Shift with at least ninety (90) days notice of the effective date of such discontinuance. DAY JOBS -------- Straight day employment shall be determined on the basis of senior qualified. EXTRA OPERATORS --------------- Employees in excess of the department's minimum staffing needs may be defined as "extra". Extra employees will not receive pay at time-and-one-half (1-1/2) premium for shift changes where notice was received more than twenty-four (24) hours in advance of the start of the new shift. WAGES ----- The hourly wage rate of an employee assigned to the 12H Rotating Shift Schedule must be adjusted so as to provide the annual earnings under the 12H Shift arrangement which shall equal that which the employee would have earned under the 8-Hour Rotating Schedule if he/she worked an equal number of hours. This adjustment is necessary due to the requirement of paying overtime hours over eight (8) in a scheduled work day, and on holidays. Under the 12H Schedule, an employee will work eight (8) hours at the straight time rate and four (4) hours at the time and one-half premium rate. To make the earnings for 12 hours of work equal to that which the employee would have earned at the straight time rate, the eight-hour (regular negotiated) rate must be reduced by multiplying said rate by a factor of 0.8685, and then rounding to the nearest xxxxx. The contractual wage rate of the various classifications affected by the 12H Shift arrangement shall, as applies to those regularly assigned to the 12H Schedule, be reduced by a factor of 0.8685. Calculation of the 0.8685 factor and the application of the adjusted rate are attached at the end of this Exhibit. Premium pay practices for holidays and shift differential, and pay continuation practice for vacation, jury duty, etc. are attached in order by Article and Section. 46 Employee Benefit Plans ---------------------- ESOP, Pension, -------------- Life Insurance and Disability ----------------------------- Contributions into the ESOP for 12H employees will be made by rationing the 42- hour average work week to a standard 40-hour work week. Therefore, the unadjusted wage rate will be multiplied by 0.9524 to calculate benefits. Examples of benefit calculations for sick pay are attached. Life Insurance, and Disability Benefits will be calculated on 2080 annual hours at the unadjusted rate with no benefit payment difference for an 8-hour or 12H Shift employee with similar service for the COMPANY. Under the Pension Plan, the scheduled 104 hours of overtime in the 12 Hour Shift Schedule are applied in the calculation for bargaining unit average overtime. OVERTIME -------- Operation of the 12H Shift will require changes of our current overtime coverage practices. It is recognized that it is no longer possible for employees to cover a vacant shift by holding over one-half of the shift and by the next shift coming in early (total of 18 hours), or to double over both shifts (total of 24 hours). Therefore, the majority of overtime will have to be covered by employees on the their days off. The Overtime Agreement will be used throughout all the affected groups, including day workers in those areas where 12H Shift employees work Overtime coverage will be provided on a voluntary basis as described below until an overtime group fails to meet its commitment to staff its respective unit around-the-clock. If a voluntary system fails to provide the necessary coverage, an alternate system will be initiated as required. A mandatory on-call system will be implemented if the voluntary system fails to produce the number of people required for overtime coverage. . The 12H Shift will make some changes necessary in the overtime procedures. . Normally, it will be necessary to cover vacant shift with persons on the off shifts. . Overtime procedures are included in the document for all affected groups. . The UNION agrees to a firm commitment to staff the plant. As a general practice, overtime will be pre-scheduled however practical by scheduling the off shift for all known overtime before each shift's days off. If there are no volunteers, the low person will be forced to work overtime. The COMPANY will attempt up to twelve (12) hours before overtime is to begin to get the lower off shift person. 47 Employees who are forced out on overtime and work up to or into their regular shift, shall be excused from work on their regular shift without pay, once the employee has performed twelve (12) hours of continuous work if the employee so requests. It is recognized that with a 12 Hour Schedule, it is no longer possible for an employee to "hold over" one-half (1/2) the shift and another employee to come in early one-half (1/2) the shift (total of 18 hours each), or "double over" (total of 24 hours). An employee cannot be forced to work more than sixteen (16) consecutive hours. Operators who work 8-hour day shift schedules in the overtime group, will comply with this procedure on weekends and holidays. When it is necessary to provide overtime coverage by calling in an employee, a change in the overtime procedure is necessary to ensure adequate staffing of the plant. A call-in list would provide names of employees eligible to work the 12 hours (i.e., capable of working the full shift without interfering with their next scheduled shift). The employee with the lowest number of hours would be contacted first, and on through the list. An employee who accepts an overtime assignment, can later turn it down; however, he/she will still be required to work unless another qualified employee (not the standby or forced person) volunteers to work. Volunteers will not be sought later than four (4) hours prior to the start of the shift. When it is necessary to provide overtime coverage by calling in an employee, the following procedure shall be followed: 1) Call the low person off shift who is eligible to perform the job. The first person contacted by telephone may refuse the assignment, but if he/she refuses, he/she will be informed that he/she is in the "forced" position. If subsequent calls to other persons fail to produce volunteers, then the "forced" persons will be required to report to work. 2) If the list of low persons off shift fails to produce the staffing necessary, the following procedure shall be followed: a) Force the on shift low person(s) on holdover for up to four (4) hours. b) Force out low person on-coming shift for up to four (4) hours. c) When necessary to do this, the middle four (4) hours will be covered as the COMPANY sees fit. d) This constitutes a breakdown in the voluntary system and may lead to the Mandatory Procedure. 48 3) In those situations where it is anticipated that the overtime required on a job shall not exceed eight (8) hours duration, the overtime will be offered to those employees present in the plant or to the on-coming shift rather than calling out the off shift. MANDATORY OVERTIME PROCEDURE ---------------------------- Should the voluntary overtime system fail to provide coverage for overtime in an overtime area, the COMPANY will review the circumstances and decide if the voluntary system will continue to fail. If so determined, then the following Mandatory Overtime Procedure and standby system will be initiated. 1) The primary shift (shift on short days off) and the secondary shift (shift on 8-day long change) will provide the needed personnel for standby. A volunteer list will be posted for employees desiring to stand by for overtime on shift as they desire. 2) The number of standby personnel will be determined by management, dependent on training, job flexibility and the number of jobs per overtime area, but will be kept to the minimum necessary. Standby duties shall be rotated on an equitable basis among all employees of the overtime group and will be for the entire off period. It is preferred that different standby personnel be scheduled for coverage of the day and night shift, of an off period. Standby lists will be posted prior to the beginning of the employee's days off. 3) The personnel on standby will not be scheduled for known overtime. 4) It will be the responsibility of the person(s) on standby to be available by phone between 3:30 a.m. and 6:30 a.m. and/or 3:30 p.m. and 6:30 p.m. If the standby personnel are not at home, it is their responsibility to let the appropriate on-duty person know where they can be reached. Standby personnel may, at the employee's option, check out a pager prior to the start of their standby period in order to facilitate communication. However, when pagers are unavailable, the standby employee will comply with the mandatory overtime procedure. The employee is responsible for verifying that the pager is working. 5) The person(s) on standby should be prepared to report to work by the beginning of the shift. CHARGING OF OVERTIME -------------------- An employee, who is contacted and refuses overtime, will be charged the total hours paid for such overtime. 49 ARTICLE 3 HOURS OF WORK SECTION 1 --------- Work day will be defined as a consecutive twenty-four (24) hour period beginning at 6:30 a.m. 12H SHIFT WORKERS ----------------- Twelve (12) consecutive hours of work per day shall constitute a days work. Day shift will be from 6:30 a.m. to 6:30 p.m. and night shift will be from 6:30 p.m. to 6:30 a.m. The payroll week for employees on the 12H Shift starts at 6:30 p.m. Thursday, and runs until 6:30 p.m. the following Thursday. The payroll day starts at 6:30 p.m. and runs until 6:30 p.m. of the following day. Shift workers are permitted sufficient time to eat during their shift without loss of pay for such period. The 12H Shift Schedule will be as follows: Four 12-Hour Days Two Days Off Three 12 Hour Nights Two Days Off Three 12-Hour Days Two Days Off Four 12-Hour Nights Eight Days Off ARTICLE 4 OVERTIME AND HOLIDAYS Section 1 --------- a) An employee shall be paid at the rate of one and one-half (1-1/2) times his adjusted rate for hours worked over eight (8) and up to twelve (12) and at a rate of one and one-half (1-1/2) times his unadjusted rate for hours worked in excess of twelve (12) within a given twenty-four (24) hour payroll day. 50 b) For 12H Shift Workers, time worked in excess of their weekly scheduled hours (36 or 48), shall be paid at the rate of one and one-half (1-1/2) times the unadjusted base rate of pay. Section 3 --------- Holiday and Holiday Pay ----------------------- All holidays listed in the Articles of Agreement will be recognized. Holiday Pay provisions begin at 6:30 a.m. on the day of the holiday. Employees assigned to the 12H Shift Schedule shall receive the following pay for holidays: 1) For holiday not worked: 8 hours times a premium factor of 1.151 times the adjusted hourly rate. 2) For all regularly scheduled hours worked on a holiday: 2.879 times the employee's adjusted hourly rate. a) For holiday hours worked outside the regular schedule, when it occurs on the same shift as the last regularly scheduled shift worked: 1.5 times the unadjusted rate times hours worked during the first 8 hours of the shift, plus 2.5 times the unadjusted rate times hours worked during the last four hours of the shift, plus Item No. 1 above. b) For holiday hours worked outside the regular schedule, when it occurs on the opposite shift as the last regularly scheduled shift worked: 2.5 times the unadjusted rate plus Item No. 1 above. All other provisions in the Articles of Agreement concerning holidays and holiday pay shall continue to apply. SECTION 5 --------- SHIFT DIFFERENTIAL ------------------ For employees assigned to the 12H Shift, the contractual rate of shift differential will be amended to provide: . 6:30 a.m. to 6:30 p.m. - no differential . 6:30 p.m. to 6:30 a.m. - $1.00 differential (adjusted where applicable - 87.7 cents) Employees assigned to the 12H Shift Schedule shall receive the following shift differential pay for holidays and when working outside the regular 12H Schedule: 51 . For regularly scheduled hours worked on the night shift of a holiday: 2.879 times the adjusted shift differential rate of 87.7 cents. . For hours worked on the night shift outside the schedule on a holiday: 2.5 times the contractual rate of $1.00. . For all hours worked on the night shift outside the regular schedule, excluding holidays: 1.5 times $1.00. . For holidays not worked: No shift differential. . For the night shift of the last scheduled day of rest worked (if all days of rest worked): 2.0 times $1.00. ARTICLE 5 VACATION The vacation policy will allow 8-hours excused absence to be taken during a 48- hour work week in conjunction with 40 hours vacation to fill out the period between days off. Remnant hours (4 or 8 hours remaining at the end of the vacation year) may be used, at the employee's discretion as follows: a) Take off with pay in conjunction with time off without pay, totaling 12 hours. This does not constitute an additional bank day. b) Take pay in lieu of vacation (at the adjusted hourly rate). c) A twelve (12) hour shift employee may opt to work his/her shift and take remnant hours (four (4) or eight (8) hours) at the beginning or end of their respective shift. This must be scheduled in advance to allow for proper coverage of the shift. This does not constitute an additional bank day. d) When it becomes known in advance that an employee has remnant vacation hours he/she may request to schedule these prior to the end of the vacation year, but only if all other vacation has been used. SECTION B) ---------- The vacation pay, for employees entitled to vacation, is computed on the basis of eight (8) hours times the adjusted hourly rate plus four (4) hours at time and one-half the adjusted hourly rate for each twelve-hour shift taken as vacation. 52 SECTION E) ---------- An employee may place up to six (6) shifts (72 hours) of their vacation in a vacation bank prior to January 1 with such days to be taken at any time during the vacation year when requested by the employee. Three (3) bank days (36 hours) may be taken with one (1) hours notice. Thirty (30) hours notice for the other three (3) bank days (36) hours will be required except in cases of emergencies. An employee will be allowed to convert one (1) 12 H bank day to three (3) four hour bank days to be taken at the beginning or end of a shift, within a vacation year. All three (3) four hour bank days must be used or lost. They cannot be treated as remnants. These bank days must be scheduled with thirty (30) hours notice and supervisor approval. No overtime meals will be granted for employees covering four hour bank days. The employee exercising the four hour bank day will be responsible for finding coverage for the opening within the overtime guidelines. This will be implemented for a one (1) year trial period and after that year will be continued with agreement between the UNION and the COMPANY. An employee is entitled to one split for each forty (40) hours of vacation earned. SECTION M) ---------- When a holiday is observed on an employee's scheduled vacation day, they will have the option of an extra day vacation or eight (8) hours pay at 1.151 times the adjusted hourly rate . ARTICLE 6 SENIORITY SECTION 9 --------- Job Bidding Procedure --------------------- Job Posting: The job vacancy will be posted for eleven (11) calendar days at each of the main gates and on departmental bulletin boards within the plant. ARTICLE 16 JURY SERVICE Employees on the day shift (6:30 a.m. to 6:30 p.m.) are not required to report back to work if dismissed from court duty at or after 12:30 p.m. Employees dismissed before 12:30 p.m. are required to report for work and complete the work day. COMPANY has the option to utilize the overtime replacement or to send them home. Employees on the night shift (6:30 p.m. to 6:30 53 a.m.) are not required to report for work if jury service commences less than eight (8) hours from the end of the last shift, or if jury service is terminated less than eight (8) hours before the beginning of the next shift. Jury duty pay for hours excused as provided above shall be: first eight (8) hours of a shift excused shall be at the adjusted rate and all hours excused after eight (8) hours shall be at one and one-half (1-1/2) times the adjusted rate. ARTICLE 25 FUNERAL LEAVE Employees will be given up to three (3) consecutive 12-hour days off, one (1) of which must be the day of the funeral. Employees will be paid for funeral leave days at eight (8) hours times the adjusted hourly rate plus four (4) hours at time and one-half (1-1/2) the adjusted hourly rate. ARTICLE 30 OCCUPATIONAL & NON-OCCUPATIONAL ACCIDENT AND SICKNESS PLAN SECTION 4 --------- The plan will provide benefit payments for 12H Shift employees, based on the unadjusted hourly rate, exclusive of all premium pay, times 0.9524. The COMPANY will provide benefits to a 12H Shift employee in an amount to equal 90% of the employee's adjusted base earnings for work time lost due to non- occupational disability. The adjusted base will be calculated by multiplying 0.9524 times the unadjusted hourly rate times the hours lost. The benefits for occupational disability will be equal to 100% of the employee's adjusted base earnings for work time lost. 54 WAGE ADJUSTMENT WAGE ADJUSTMENT --------------- The intent of wage adjustment is to adjust hourly wage rate and shift differential so the 12H schedule can be paid within contractual premium agreements and: 1) Cause the employee no loss of earnings. 2) Pay the employee at least a 1.5 premium for the additional 104 hours per year in the 12H schedule versus the existing 8-hour schedule, and 3) Keep the total cost of the 12H schedule at approximately the same cost of the 8-hour schedule. HOURS WORKED AND PAID UNDER 8-HOUR AND 12-HOUR SHIFT SCHEDULE ------------------------------------------------------------- Presently, shift employees are scheduled to work an average of 2080 hours per year. With a 12H shift, employees will be scheduled to work an average of 2,184 hours per year. Therefore, pay practices for the 12H shift must be calculated as if the employee were working an additional 104 hours at least a 1.5 premium. A) Average annual earnings on the present 8-hour schedule, based on 2080 hours worked. Hours PREMIUM HOURS Type Worked Factor Paid ---- ------ -------- ---- Total S/T Worked (excl. holidays) 2,017.1 1.0 2,017.1 Scheduled Holiday (Avg. = 7.86 days) 62.9 2.5 157.1 Holiday Off Hours (Avg. = 3.14 days) (25.1) 1.0 25.1 ------- ------- 2,080.0 2,199.3 Earnings = 2,199.3 ($16.73) = $36,794.29 55 B) Average annual earnings under an 8-hour, 2,184-hour schedule: Hours PREMIUM HOURS Type Worked Factor Paid ---- ------ ------ ---- Total S/T Worked (excl. holidays) 2,017.1 1.0 2,017.1 Additional hours at 1.5 premium 100.9 1.5 151.4 Scheduled Holiday (Avg. = 8.25 days) 66.0 2.5 165.0 (includes 3.1 additional hours) Holiday Off Hours (Avg. = 2.75 days) (22.0) 1.0 22.0 ------- ------- 2,184.0 2,355.5 Earnings = 2,355.5 ($16.73) = $39,407.52 C) Average annual earnings under the 12H, 2,184-hour schedule: Hours PREMIUM HOURS Type Worked Factor Paid ---- ------ ------ ---- Scheduled S/T (excl. holidays) 1,412 1.0 1,412.0 Scheduled O/T (excl. holidays) 706 1.5 1,059.0 Holiday Hours (Avg. 5.5 days) 66 2.879 190.0 Holiday Off Hours (Avg. 5.5 days) (44) 1.151 50.6 ----- ------- 2,184 2,711.6 Annual earnings are the same as in Case B = $39,407.52 Wage Rate = $39,407.52 = $14.53 -------------- 2,711.6 Ratio of 12H rate to 8-hour rate = $16.73 = 1.151 $14.53 = 0.8685 -------- -------- $14.53 $16.73 Earnings 2,711.6 ($14.53) = $39,399.55 56 SHIFT DIFFERENTIAL ------------------ Currently, shift employees receive shift differential for working the evening and midnight shifts. When premium rates apply to hours worked, the same premium is applied to shift differential. Under the 12H shift, shift differential will be paid for the night shift only, therefore, the rate must be adjusted to keep annual earnings the same. Shift differential will continue to be increased by premium rates, and will continue to be paid only for hours worked. A) Average Annual Shift Differential under the present 8-hour schedule, based on 2,080 hours worked: Hours PREMIUM HOUR Type Worked Factor Paid Rate Earnings ----- ------- -------- ------ ------ ---------- Eve Shift (excl. holidays) 672.4 1.0 672.4 $0.50 $ 336.20 Mid Shift (excl. holidays) 672.4 1.0 672.4 $1.00 $ 672.40 Holiday Eve Shift 21.0 2.5 52.5 $0.50 $ 26.25 Holiday Mid Shift 21.0 2.5 52.5 $l.00 $ 52.50 --------------- $1,087.35 B) Average Annual Earnings on the present 8-hour schedule, based on 2,184 hours worked: Hours PREMIUM HOURS Type Worked Factor Paid Rate Earnings ----- -------- ---------- ------- ------ ----------- Eve Shift S/T (excl. 672.4 1.0 672.4 $0.50 $ 336.20 holidays) Eve Shift O/T (excl. 33.6 1.5 50.4 $0.50 $ 25.20 holidays) Mid Shift S/T (excl. 672.4 1.0 672.4 $1.00 $ 672.40 holidays) Mid Shift O/T (excl. 33.6 1.5 50.4 $1.00 $ 50.40 holidays) Holiday Eve Shift 22.0 2.5 55.0 $0.50 $ 27.50 Holiday Mid Shift 22.0 2.5 55.0 $l.00 $ 55.00 -------------- $1,166.70 57 C) Average Annual Shift Differential on the 12H shift schedule, based on 2,184 hours worked: The 12H shift differential rate (unadjusted) is calculated as follows: 8-Hour Schedule 12H Scheduled ----------------- --------------- Days $0.00/hr. * 8 = $0.00 Days - No differential Eves. $0.50/hr. * 8 = $4.00 Nights - $12.12 hr. = $1.00/hr Mid $1.00/hr. * 8 = $8.00 -------------- $12.00/day Hours PREMIUM HOURS Type Worked Factor Paid Rate Earnings S/T Night Shift (excl. holidays) 706 1.0 706.0 $1.00 $ 706.00 O/T Night Shift (excl. holidays) 353 1.5 529.5 $1.00 $ 529.50 Holiday Night Shift 33 2.879 95.0 $1.00 $ 95.00 ---------- ------------ 1,330.5 $1,330.50 Therefore, the negotiated shift differential must be adjusted by: $1,166.70 = 0.877 ------------- $1,330.50 to keep annual earnings the same. Annual Earnings = $1,330.5 (0.877) $1,166.85 SUMMARY -- COMBINED ANNUAL EARNINGS A) Under present 8-Hour (2,080 hours) schedule: Straight Time, O/T & Holiday Wages $36,794.29 Shift Differential 1,087.35 -------------- $37,881.64 58 B) Under an 8-hour (2,184 hours) schedule: S/T, O/T & Holiday Wages $39,407.52 Shift Differential 1,166.70 ------------- $40,574.22 C) Under the 12H (2,184 hours) schedule: S/T, O/T & Holiday Wages $39,399.55 Shift Differential 1,166.85 ------------- $40,566.40 PAY RATES --------- Premiums under the 12-hour schedule will be as follows: A) Straight time hours as part 1.0 x 12 hour base of the regular schedule 1.0 x $14.53 = $14.53 B) Overtime hours as part 1.5 x 12 hour base of the regular schedule 1.5 x $14.53 = $21.80 C) Hours worked beyond 12. 1.5 x $16.73 = $25.10 OR Hours worked outside regular schedule. OR Hours worked for schedule change outside contract notice. D) Hours worked on last schedule day of 2.0 x $16.73 = $33.46 rest (if all days of rest worked that week). E) Hours worked on scheduled 2.879 x 12 hour base holiday up to 12 hours. 2.879 x $14.53 = $41.83 F) Hours worked on holiday outside regular 2.5 x $16.73 = $41.83 schedule G) Vacation Pay, Jury Duty, 8 Hrs. x 12-Hour base Funeral Pay, etc. + 4 Hrs. x 1.5 x 12-Hour base H) Holiday not worked (8 hours) 1.151 x $14.53 = $16.72 59 EXHIBIT B WAGE RATES [THIS PAGE INTENTIONALLY LEFT BLANK] EXHIBIT B WAGE RATES 12/21/98 5/1/2000 5/1/2001 -------- -------- -------- 3% 3% 3% Maintenance - Primary Skills ---------------------------- 3% 3% 3% BOILERMAKER/IRONWORKER 23.12 23.81 24.52 INSTRUMENT & ELECTRICAL 23.18 23.88 24.60 MACHINIST 23.12 23.81 24.52 PIPEFITTER 23.12 23.81 24.52 OPERATING ENGINEER 23.12 23.81 24.52 MAINTENANCE - GENERAL MECHANIC CLASSIFICATION --------------------------------------------- (WHEN QUALIFIED) 23.12 23.81 24.52 MAINTENANCE - SECONDARY SKILLS (FROZEN) --------------------------------------- ASBESTOS WORKER 22.45 22.45 22.45 XXXXXXXXX 22.45 22.45 22.45 PAINTER 22.45 22.45 22.45 LABORER 20.35 20.35 20.35 STORES CLERK (FROZEN) 21.67 21.67 21.67 --------------------- OPERATOR 23.12 23.81 24.52 -------- PUMPER XXXXXX 23.12 23.81 24.52 ------------- LAB ANALYST 23.12 23.81 24.52 ----------- APPRENTICE LEVELS ----------------- Apprentices: Chemical Operator, Pumper Xxxxxx, Lab Analyst ---------------------------------------------------------- Start (Frozen) 17.42 17.42 17.42 End of 6 Months 18.37 18.49 18.60 End of 12 Months 19.32 19.55 19.79 End of 18 Months 20.27 20.62 20.97 End of 24 Months 21.22 21.68 22.16 End of 30 Months 22.17 22.75 23.34 End of 36 Months 23.12 23.81 24.52 (Journeyman Rate) 62 12/21/98 5/1/2000 5/1/2001 -------- -------- -------- 3% 3% 3% Maintenance Apprentice (Partial List) ------------------------------------- Boilermaker/Ironworker, Machinist, Pipefitter, Operating Engineer Only Start (Frozen) 17.42 17.42 17.42 End of 6 Months 18.13 18.22 18.31 End of 12 Months 18.85 19.02 19.20 End of 18 Months 19.56 19.82 20.08 End of 24 Months 20.27 20.62 20.97 End of 30 Months 20.98 21.41 21.86 End of 36 Months 21.70 22.21 22.75 End of 42 Months 22.41 23.01 23.64 End of 48 Months 23.12 23.81 24.52 (Journeyman Rate) Maintenance Apprentice (Partial List) - (FROZEN) ------------------------------------------------ Asbestos Worker, Xxxxxxxxx, Xxxxxxx Only Start 17.42 17.42 17.42 End of 6 Months 17.98 17.98 17.98 End of 12 Months 18.56 18.56 18.56 End of 18 Months 19.16 19.16 19.16 End of 24 Months 19.79 19.79 19.79 End of 30 Months 20.41 20.41 20.41 End of 36 Months 21.08 21.08 21.08 End of 42 Months 21.76 21.76 21.76 End of 48 Months 22.45 22.45 22.45 (Journeyman Rate) I&E Apprentice -------------- Start (Frozen) 17.42 17.42 17.42 End of 6 Months 18.00 18.07 18.14 End of 12 Months 18.57 18.71 18.86 End of 18 Months 19.15 19.36 19.57 End of 24 Months 19.72 20.00 20.29 End of 30 Months 20.30 20.65 21.01 End of 36 Months 20.88 21.30 21.73 End of 42 Months 21.45 21.94 22.44 End of 48 Months 22.03 22.59 23.16 End of 54 Months 22.60 23.23 23.88 End of 60 Months 23.18 23.88 24.60 (Journeyman Rate) Note: Upon ratification of the contract, employees in the Chief, Leadman, and Hourly Planner classifications will be returned to the Journeyman level of their respective classifications. The pay rates of these employees will remain frozen until the wage rates for their respective classifications exceeds their frozen pay rates. 63 [THIS PAGE INTENTIONALLY LEFT BLANK] EXHIBIT C APPRENTICESHIP AGREEMENTS CHEMICAL PROCESS OPERATOR APPRENTICE STANDARDS These Standards for the training of Operators (Group 1) have been prepared and adopted jointly by Sterling Chemicals, Texas City, Texas and the Texas City, Texas Metal Trades Council, AFL-CIO. It is essential that chemical process operators be broadly trained in the practical and mechanical aspects of their work in order to develop skills which will be valuable to the COMPANY and themselves. These skills will be obtained both on and away from the job. The Apprenticeship Standards have as their broad purpose the establishment, maintenance, and improvement of high standards of training and performance among chemical process operators (Group 1) employed by the COMPANY in order to assist them in developing such necessary skills. Provisions outlined in the Operator Apprenticeship Standards may be modified by mutual agreement between the COMPANY and the UNION, and either party reserves the right to terminate these Operator Apprenticeship Standards by giving written notice at least sixty (60) days prior to the desired date of termination.. Both parties agree that these Standards, to be acceptable, must be certified by the Bureau of Apprenticeship and Training. It is further agreed that should the registration agency require any changes in the Standards, the parties will meet and discuss these recommendations. SECTION 1 - DEFINITIONS The following terms, as used herein, shall be construed as follows: A) "COMPANY" shall mean Sterling Chemicals, Inc., Texas City, Texas. B) "UNION" shall mean Texas City, Texas Metal Trades Council, AFL-CIO. C) "Apprentice Training Supervisor" shall be that Management Representative as signed by the COMPANY who is responsible for the maintenance of records and coordination of the apprenticeship program. D) "Apprentice Job Instructor" shall mean personnel of the COMPANY who are qualified in the work being performed and selected by the Manufacturing Superintendent, to instruct apprentices on the job or in the plant. E) "Apprentice" shall be a person who has been properly selected for training and who has signed an agreement with the COMPANY to train as an apprentice operator, as outlined in these Standards. 65 EXHIBIT C APPRENTICESHIP AGREEMENTS F) "Apprenticeship Agreement" shall mean a written agreement between the COMPANY and the employee selected for and classified as an Operator Apprentice. (A sample copy is attached.) G) "Parties to the Operator Apprenticeship Agreement" shall mean the apprentice, his/her parents or guardian (if he/she is a minor), and a duly authorized representative of the COMPANY, each of whom shall sign the agreement. H) "Operator Apprenticeship Advisory Committee" shall mean the persons selected to confer with Management on operator training problems. This committee shall be composed of three UNION operators and three MANAGEMENT representatives. I) Apprenticeship Standards" shall mean this entire exhibit including these definitions. J) "Classroom instructor" shall mean personnel who are associated with or trained in operating work and who meet the qualifications required by the Texas Education Agency and selected to instruct apprentices in their instruction classes." K) "Registration Agency" shall mean the Bureau of Apprenticeship and Training. SECTION 2 - ADMINISTRATION The administration of these Standards and the supervision of the following duties shall be under the general direction of the Plant Manager or his representative, whose duty it shall be: A) To see that each prospective apprentice is interviewed and impressed with the responsibilities he/she is about to accept, as well as the benefits he/she will be entitled to receive. B) To accept or reject applicants for apprenticeship after proper examination and interviews, and execute the Operator Apprenticeship Agreement. C) To recommend apprenticeship agreement for registration with the Registration Agency. D) To see that adequate records are kept of all apprentices' progress. E) To see that apprentices are given a variety of work experience which is outlined under Section 15 hereof, and that they are properly instructed in their respective jobs. F) To certify completion of training to the Registration Agency who will issue a certificate. G) To recommend candidates as Classroom Instructors and to require periodic reports from the Instructors. 66 EXHIBIT C APPRENTICESHIP AGREEMENTS H) To hold periodic meetings with the plant Operator Apprenticeship Advisory Committee and other consultants of interested agencies that may offer suggestions for the improvement of the program. I) To request the supervisor to see that safety practices and principles are incorporated in the training of all apprentices. J) To advise the Registration Agency of the cancellation of Apprenticeship Agreements. SECTION 3 - SUPERVISION OF APPRENTICES A) Apprentices shall perform work in connection with their training under the supervision of their immediate supervisor, who will be assisted by an Apprentice Job Instructor. Apprentices shall be responsible for tracking hours worked in each training category on a regular and ongoing basis and ensuring that the total training hours logged in each category are consistent with the requirements of the apprenticeship program. B) The Apprentice Training Supervisor shall keep a record of the progress of each apprentice, both on the job and in the classroom, and shall keep the Management and Operator Apprentice Advisory Committee informed of same. If on consultation with the Manufacturing Superintendent, the Job Instructor or Classroom Instructor, he/she finds that an apprentice shows lack of interest or does not appear to have the ability to be an operator, he/she shall place all the facts in the case before the Management. Under these circumstances, an apprentice may be placed in a probationary status. Apprentices are responsible for taking the initiative to consult with the Apprentice Training Supervisor and the Apprentice Job Instructor as frequently as is needed to ensure that assignments and hours worked are properly distributed among the various apprentice training categories to adequately prepare the apprentice for interim and final examinations. C) An apprentice who fails a portion of his/her training program, either on the job or related classroom work, because of absenteeism, a lack of interest, or does not appear to have the ability to be an operator, will be placed in a probationary status and will be required to satisfactorily complete the specified area of training in which he/she failed. He/she will not receive merit increases during this probation. When he/she has satisfied the requirements of his/her probation, his/her next merit increase shall be at his/her indicated calendar pay level. No merit increase will be retroactive. Only one probation will be allowed and that period shall not exceed six (6) months. If an apprentice fails to satisfy the requirements of his/her probation, his/her Apprenticeship Agreement will be terminated, and if his/her apprenticeship agreement is terminated his/her employment will be terminated. If probation is for poor related classroom performance, this period will be added to the end of the apprentice's program. If this extended work is not completed, the employee will be terminated. 67 EXHIBIT C APPRENTICESHIP AGREEMENTS SECTION 4 - APPRENTICE ELIGIBILITY REQUIREMENTS Applicants before being accepted for training must be able to meet the following requirements A) Education qualifications for candidates hired on or after May 1, 1993, are: 1. Junior College Basic Petrochemical Operators Course, 2. Three (3) hours of a college level math, 3. Six (6) hours of a college level science, 4. With a GPA of 2.5 or better (A=4.0). B) Be of legal working age C) Meet physical and mental requirements of the position D) Willing to work shift work and overtime E) Willing to serve on Fire Squad SECTION 5 - SELECTION OF OPERATOR APPRENTICES A) The success of the apprenticeship program is facilitated by a careful selection of candidates. The greatest care will be exercised in selecting the best qualified applicants. Consideration will be given to physical qualifications, interest, aptitude, mental capacity to absorb and profit by the instruction given on the job and the classroom, past history and accomplishments, background, and general acceptability as a candidate for apprentice training. Present employees will be considered before outside candidates. These factors will be determined by interview and examination of relevant material. It shall be the responsibility of Management to exercise final judgment with respect to relative fitness of candidates. B) Selection of apprentices under the program shall be made from qualified applicants on the basis of qualifications alone and without regard to race, religion, color, national origin, age, sex, veteran status or disability in accordance with objective standards which permit review after full and fair opportunity for application; and this program shall be operated on a completely nondiscriminatory basis. SECTION 6 - NUMBER OF APPRENTICES At no time should the number of apprentices be more than one (1) apprentice to every two (2) operators on a departmental basis unless mutually agreed to by the parties. 68 EXHIBIT C APPRENTICESHIP AGREEMENTS SECTION 7 - TERM OF TRAINING The usual term or duration of training for the Operator Apprentices within the plant shall be thirty-six (36) months. The term shall be divided into six (6) month periods of advancement. An apprentice may be required to make up extended absences before being advanced to the next period. SECTION 8 - PROBATIONARY PERIOD A) The first one-hundred thirty-five (135) days of training shall be a probationary period for new employees. During this probationary period the operator apprentice will be very carefully checked to determine his/her fitness to continue the training. Should it become evident that he/she does not have the necessary qualifications to continue successfully, he/she will be promptly released so that he/she may possibly continue in some other line of work for which he/she may be better qualified. The advantage of apprenticeship will be reserved for those who can and do make the best of opportunities offered. B) Probationary Period as used in this Section 8 is the contractual probation as provided in the Articles of Agreement and should not be confused with the probation as provided in Section 3 of these Chemical Process Operator Apprenticeship Standards. SECTION 9 - APPRENTICESHIP AGREEMENT The apprentice, and if he/she is under 21 years of age, his/her parents or guardian, shall be required to sign an Operator Apprenticeship Agreement and such agreement shall also be signed by the COMPANY. The following shall receive copies of the Agreement: A) The Operator Apprentice B) The Company C) The Union D) Registration Agency (Bureau of Apprenticeship & Training) SECTION 10 - WAGES A) Operator Apprentices will be paid according to the wage schedule for Operator Apprentices in the current Articles of Agreement. 69 EXHIBIT C APPRENTICESHIP AGREEMENTS B) The apprentice will be required to pass either an oral or written examination covering his/her work experience for the current period of apprenticeship before each advancement in the wage schedule. C) All qualified applicants who have had previous experience and are accepted as an operator apprentice will be positioned in the Operator Apprenticeship Training Program within the first six (6) months of employment. They will be positioned in the wage schedule in accordance with the applicable experience and training after their record has been checked and evaluated by the Apprentice Training Supervisor and the Operator Apprentice Advisory Committee. SECTION 11 - BASIC WORK TRAINING SCHEDULE Apprentices shall receive training as outlined in Section 15, hereof, together with any other instruction which will assist in the development of future operators. Operator apprentices shall not be charged with refusal of overtime when they must refuse because of interference with related instruction classes of apprentices. SECTION 12 - RELATED INSTRUCTION Operator Apprentices will be required to complete a minimum of one-hundred forty-four (144) hours per year of related and technical instruction such as but not limited to mathematics, physics, chemistry, instrumentation, and unit operations. Related classroom instruction will begin at the start of the first regular semester after date of hire, and will continue for three (3) consecutive years. An apprentice will not graduate from the program until he/she has successfully completed his/her related classroom instruction. The cost of miscellaneous stationery materials required for classroom instruction held outside of scheduled working hours shall be paid for by the Operator Apprentice. The cost of books, manuals, related instructional material and tuition required for classroom instruction held outside of scheduled working hours shall be paid for by the COMPANY. Apprentices shall exercise the same diligence in their classroom work and assignment as is expected in their practical on-the-job work. The determination of progress and fitness for operation shall be based, in part, on the proficiency shown in related classroom activities. When classroom instruction is given outside of scheduled working hours, these hours of training shall not be considered hours of work nor shall wages be paid for them. SECTION 13 - CERTIFICATE FOR COMPLETION OF APPRENTICESHIP Upon satisfactory completion of the requirements of apprenticeship, as established herein, the COMPANY shall certify the names of the graduate apprentices to the Registration Agency, and recommend that Certificate of Completion of Apprenticeship be awarded. 70 EXHIBIT C APPRENTICESHIP AGREEMENTS SECTION 14 - OPERATOR APPRENTICE TERMINATION A) If the UNION alleges that an Operator Apprentice was unfairly terminated or placed on probation because of his/her inability to meet the requirements of the Operator Apprenticeship Standards, then the UNION may discuss the termination or probation in accordance with the current Articles of Agreement. During any time of the apprenticeship, the Apprenticeship Agreement may be terminated by the apprentice or the COMPANY for good and sufficient reasons given by the party so desiring to terminate such agreement and tendered to the other party in writing. B) Non-conformity to the accepted standards of performance, lack of industry or capacity, improper conduct, or other action or lack of action on the part of the employee such as to make him/her an undesirable apprentice may be cause for termination of that Operator's Apprenticeship Agreement. SECTION 15 - TRAINING WORK SCHEDULE The Operator Apprentice shall be given such a job experience and instruction necessary to prepare him/her in a broad field of operating proficiency. There will be considerable flexibility in the amount of time each apprentice will spend on a given process, depending on the ability of the apprentice, the department to which he/she is assigned, and the changing nature of our plant. This training and work experience will prepare the operator to work in other operational areas with a minimum of additional training and familiarization. Basically, each apprentice will be given an overall training program that will encompass varying amounts of training and experience in three (3) or more of the eleven (11) operational categories listed below as they apply to his/her department to accumulate approximately six-thousand (6,000) hours training experience over a thirty-six (36) month period. A) Thermal Cracking - Furnace Operations B) Steam Generation C) Converter Operation D) Power Generation and Distribution E) Reactor Operation F) Water Cooling and Distribution G) Compressor Operation H) Fractionation - Distillation 71 EXHIBIT C APPRENTICESHIP AGREEMENTS I) Water Treating J) Material Handling K. Refrigeration It is understood that each of these major operational categories may include elements of other operational categories and that the listing of major categories does not limit or restrict the types or variety of additional operation experiences which may be included in any such category. Operator Apprentice Training will be on jobs assigned by the COMPANY. The usual work experience will approximate but will not be limited to the following: APPROXIMATE HOURS Process flow of the various units (Unit and Production) 720 Pump Orientation, lubrication & preventative maintenance 320 Starting, stopping operation, taking readings and preventative maintenance of compressors 320 Operation of exchangers and coolers 320 Chemical reactor operation 480 Operation of steam boilers, turbines and power distribution 320 Refrigeration operation 320 Distillation, absorption, and column equipment operation 480 Safe handling of materials, knowledge of physical and toxicological properties and emergency procedures 480 Cooling tower operation, water treatment and pollution control 160 Blowdown and flare systems operations 160 Quality control, product sampling & testing 160 Reading and interpreting process control instruments; making adjustments to control process variables 320 Tracing lines and sketching 160 Operation of analyzers and blenders 160 Operation of furnaces and boilers 160 Operation of process dryers 160 Chemical treating 320 Gauging, weighing, inventory tanks, transfer of materials 160 Valves, traps, safety device, operation, safety & fire protection in unit 160 Troubleshooting process problems 160 _______ TOTAL 6,000 NOTE: The 6,000 hours total shown may be accumulated from various combinations of usual work experience above. 72 EXHIBIT C APPRENTICESHIP AGREEMENTS The foregoing Apprentice Standards are agreed to this 18th day of December, 1998. STERLING CHEMICALS, INC. TEXAS CITY, TEXAS TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO Registered as incorporating the fundamentals of apprenticeship recommended by the Federal Committee on Apprenticeship. ADMINISTRATOR U.S. Department of Labor Bureau of Apprenticeship and Training Date Filed_______________ 73 EXHIBIT C APPRENTICESHIP AGREEMENTS ATTACHMENT CHEMICAL PROCESS OPERATOR APPRENTICESHIP STANDARDS CHEMICAL PROCESS OPERATOR APPRENTICE AGREEMENT Apprentice:____________________________________________________________________ Craft:_________________________________________________________________________ THIS AGREEMENT, entered into this _________ day of __________________________, 19 _____ between the apprentice whose name appears above and Sterling Chemicals, Texas City, Texas, its successors or assigns, WITNESSETH THAT the Company and the apprentice, and his/her parents or guardian if he/she is a minor, desire to enter into an Agreement of Apprenticeship, and therefore, in consideration of the promises and of the mutual covenants herein contained do hereby mutually covenant and agree as follows: 1) The Company agrees, during the period of this Agreement to: a) Furnish to the apprentice as broad a work experience as is practical within the craft named above and is consistent with the duties performed by other employees in the craft and as is consistent with the apprentice's interest and his/her ability to master the skills involved. b) Pay the above mentioned apprentice his/her regular contract rate of pay for the time he/she spends in actually performing work for the Company. c) Conform to provisions as stipulated in the "Chemical Process Operator Apprenticeship Standards," which shall be considered a part of this Agreement. 2) The apprentice named above agrees to: a. Perform for the Company the highest quality of work of which he/she is capable. b. Abide by all applicable rules and regulations pertaining to safety practices. c) Conform to provisions as stipulated in the "Chemical Process Operator Apprenticeship Standards," which shall be considered a part of this Agreement. 74 EXHIBIT C APPRENTICESHIP AGREEMENTS 3. The parents or guardian agree to: a. Make all reasonable efforts to assure proper and diligent performance by the apprentice of all obligations assumed under this Agreement. The apprenticeship term begins on the _______ day of ________, 19 ___ and terminates upon the successful completion by the apprentice of thirty-six (36) months of training by the Company in said craft, as stipulated in the "Chemical Process Operator Apprenticeship Standards". Credit for ___ months of previous experience toward apprenticeship is hereby granted this apprentice. This credit shall count in the wage progression schedule only. Explanation, if any, of a credit granted: ------------------------------------------------------------------------------- _______________________________________________________________________________ In witness whereof the parties hereunto set their hands. The foregoing Apprentice Agreement is agreed to this _____ day of _______, 19_____. STERLING CHEMICALS, INC. Texas City, Texas _______________________________________________ (Signature) ----------------------------------------------- ------------------------ (Title) (Date) APPRENTICE ----------------------------------------------- ------------------------ (Please Print Name)) (Date of Birth) ----------------------------------------------- ------------------------ (Signature) (Date) ----------------------------------------------- ------------------------ (Parent or Guardian Signature) (Date) Registered as incorporating the fundamentals of apprenticeship recommended by the Federal Committee on Apprenticeship. ADMINISTRATOR U.S. Department of Labor Bureau of Apprenticeship and Training 75 EXHIBIT C APPRENTICESHIP AGREEMENTS MAINTENANCE APPRENTICESHIP STANDARDS STERLING CHEMICALS, INC. ITS SUCCESSORS AND ASSIGNS AND THE TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO OF TEXAS CITY, TEXAS Revised December 18, 1998 76 EXHIBIT C APPRENTICESHIP AGREEMENTS MAINTENANCE APPRENTICESHIP STANDARDS OBJECTIVES These Standards have as their broad purpose the establishment, maintenance, and improvement of high standards of workmanship in the crafts employed by the Company and to establish a long range training program that will meet the needs of the Company in providing craft persons for each trade, giving individuals an opportunity to advance into the Journey person classification. DEFINITIONS The following terms, as used herein, shall be construed as follows: A) "COMPANY" shall mean Sterling Chemicals, Inc., Texas City, Texas. B) "UNION" shall mean Texas City, Texas Metal Trades Council, AFL-CIO. C) JOINT APPRENTICESHIP COMMITTEE shall mean the persons selected to confer with Management on apprenticeship training problems. D) APPRENTICE TRAINING SUPERVISOR shall be the Management representative assigned by the Company who is responsible for coordination and maintenance of records of the Apprentice Program. E) APPRENTICE JOB INSTRUCTOR shall mean a journey person selected by management to instruct an apprentice on the job, or in the plant. G) APPRENTICE shall be a person who has been selected for training and who has signed an apprentice agreement with the Company to train for a skilled trade, as outlined in the Maintenance Apprenticeship Standards. E) APPRENTICE AGREEMENT shall mean a written agreement between the Company and the employee selected for and classified as an apprentice, sample copy of which is attached hereto, and it shall be registered with the Bureau of Apprenticeship Training. H) REVIEW OF AGENCY OR REGISTRATION AGENCY shall mean the Bureau of Apprentice ship and Training, U.S. Department of Labor. I) PARTIES TO THE APPRENTICE AGREEMENT shall mean the apprentice, his/her parents or guardian (if he/she is a minor), and a duly authorized official of the Company, each of whom shall sign the Apprentice Agreement. J) STANDARDS OF APPRENTICESHIP shall mean this entire Exhibit, including these definitions. 77 EXHIBIT C APPRENTICESHIP AGREEMENTS K) APPRENTICEABLE CRAFTS shall include, but shall not be limited to, crafts with the following titles: Boilermaker/Ironworker, Xxxxxxxxx, Instrument/Electrical Worker, Asbestos Worker, Machinist, Painter, Pipefitter and Operating Engineer. L) CRAFT APPRENTICE REPRESENTATIVE shall mean the representative elected or appointed by the craft to advise and assist in matters relative to the Apprentice Training Program as it pertains to his/her craft. JOINT APPRENTICESHIP COMMITTEE A Joint Apprenticeship Committee will consist of representatives of Management and the Craft Apprentice representative of those crafts having apprentices covered by an apprenticeship agreement. This committee will advise in the operation of the program and functions as outlined in these Standards. BASIC QUALIFICATIONS A) Be of legal working age. B) Willing to work shift work and overtime. C) Educational requirements for all Machinists and Instrument/Electrical candidates hired on or after May 1, 1993, are: 1) Six (6) hours of college math, and Six (6) hours of college science, With a GPA of 2.5 or better (A = 4.0) , OR 2) Graduate of a vocational trade school with 2.5 GPA or better D) Meet physical and mental requirements of the position. SELECTION OF CRAFT APPRENTICES The success of the apprentice program is facilitated by a careful selection of candidates. The greatest care will be exercised in selecting the best qualified applicants. Consideration will be given to physical qualifications, interest, aptitude, mental capacity to absorb and profit by the instruction given on the job and in the classroom, past history and accomplishments, background and general acceptability as a candidate for apprentice training. Present employees will be considered before outside candidates as long as they meet the basic qualifications described above. These factors will be determined by interview and examination of relevant material. It shall be the responsibility of Management to exercise final judgment with respect to relative fitness of candidates. Selection of apprentices under the program shall be made from qualified 78 EXHIBIT C APPRENTICESHIP AGREEMENTS applicants on the basis of qualifications alone and without regard to race, religion, age, color, national origin, sex, veteran status or disability in accordance with objective standards which permit review after full and fair opportunity for application; and this program shall be operated on completely non-discriminatory basis. APPRENTICE AGREEMENT A written apprenticeship agreement will be executed between the Company and each apprentice (if he/she is under twenty-one (21) years of age his/her parents or guardian shall be required to sign) entering the Apprenticeship Program. A sample of this agreement is attached. ADMINISTRATION The apprentices may be moved from job to job within their crafts in accordance with the schedule of work experience outlined in these Standards. The Craft Supervisor will keep records of work performed by each apprentice showing the time spent on jobs and the quality and progress of the work performed. The Human Resources Department will keep a record of the progress of each apprentice, both on the job and in the classroom and shall keep Management and the Joint Apprenticeship Committee informed of the same. Likewise, apprentices shall be responsible for tracking hours worked in each training category on a regular and ongoing basis and ensuring that the total training hours logged in each category are consistent with the requirements of the apprenticeship program. Apprentices are responsible for taking the initiative to consult with the Apprentice Training Supervisor and the Apprentice Job Instructor as frequently as is needed to ensure that assignments and hours worked are properly distributed among the various apprentice training categories to adequately prepare the apprentice for interim and final examinations. No merit increase will be retroactive. Only one probation will be allowed and that period shall not exceed six (6) months. If an apprentice fails to satisfy the requirements of his/her probation, his/her Apprenticeship Agreement will be terminated, and if his/her Apprenticeship Agreement is terminated his/her employment will be terminated. If probation is for poor related classroom performance, this period will be added to the end of the apprentice's program. If this extended work is not completed, the employee will be terminated. Termination outside of the new-hire one-hundred thirty-five (135) day probationary period will be subject to the grievance and arbitration procedure. If the apprentice shows a lack of interest or does not appear to have the ability to become a craft person, the apprentice may be permitted to continue in a probationary status, repeat specified process or to have his/her apprentice agreement terminated and should his/her apprentice agreement be terminated his/her employment will be terminated. 79 EXHIBIT C APPRENTICESHIP AGREEMENTS The Human Resources Department will consult with local school authorities in order to assist in providing for trade science and related trade information classes which are to be attended by each apprentice outside of normal working hours. The Human Resources Department will prepare and secure signatures on apprentice ship agreements and register the agreement with the Bureau of Apprenticeship and Training. TERMS OF APPRENTICESHIP The terms of apprenticeship will be eight thousand (8,000) hours of reasonably continuous employment for four (4) years or as may be specified for particular crafts. CREDIT FOR PREVIOUS EXPERIENCE Before a new employee has passed the one-hundred thirty-five (135) day probationary period the apprentice representatives from the Company and the craft involved shall meet and agree to the amount of credit, if any, to be given toward completion of the required hours of the apprenticeship program. The amount of credit shall be based on past experience and training and subjects related to the craft in which the apprentice is entering the training. PROBATIONARY PERIOD The first one-hundred thirty-five (135) days shall be a probationary period. During this probationary period the apprentice will be very carefully checked to determine his/her fitness to continue the training. Should it become evident that he/she does not have the necessary qualifications to continue successfully, he/she will be promptly released from apprenticeship LAYOFFS If a general reduction in force becomes necessary because of reduced production requirements (or for any another reason beyond the control of the Company or the Apprentice), the layoff of an apprentice is to be effected in accordance with the existing seniority provisions and pertinent portions of Company -- Union Contract, his/her Apprentice Agreement will be automatically suspended but not canceled. Further, it is mutually agreed that no new apprentice will be hired into any craft while there are journey persons in that craft on the recall list. 80 EXHIBIT C APPRENTICESHIP AGREEMENTS SCHEDULING OF BASIC WORK EXPERIENCE The apprentice shall be given such experience and instruction as will qualify him/her as a journey person in the trade. Flexibility in the time spent on each activity is permissible on the basis of the apprentice's ability to grasp the skill. Vacations will be counted as hours worked. Extended illness or leaves of absences will be looked at on a case by case basis but may extend the apprentice period. Dependent upon the Company's production requirements, rate of operation, work load or the ability of the apprentice, the distribution of time may deviate from the following listings. The schedule for each craft is set forth as follows: ASBESTOS WORKER Use and care of tools 100 Identification of hot materials 400 Application of hot materials 2900 Curved and flat surfaces Pipe surfaces Cement and finish exterior Cement and finish interior Use and care of tools 100 Identification of cold materials 500 Application of cold materials 2000 Curved and flat surfaces Pipe surfaces Finished, flat and curved surfaces Interior, Exterior Finish, piping Interior, Exterior Stripping and sealing cold surfaces 800 Equipment Piping Cement and masonry 960 Estimation of material per job 200 Safety Asbestos Handling - Specific Procedures 40 TOTAL 8,000 ---------------------------------------------------------------------- 81 EXHIBIT C APPRENTICESHIP AGREEMENTS XXXXXXXXX Use and care of hand tools 200 Scaffolds and rigging 2500 Building and setting concrete forms 1000 Shoring and bracing 500 Driving sheet piling 500 Installing transite roofing siding 700 Repair of cooling towers 1000 Blueprints and sketching 700 Use and care of power tools 700 Crating 200 Cabinet making 0 Safety (Continuous) TOTAL 8000 ---------------------------------------------------------------------- BOILERMAKER/IRONWORKER Use and care of tools (Continuous) Layout blueprints and sketching 500 Bubble towers & filters (bubble caps xxxx and down 1000 comers) Fabricating steel 600 Rigging and equipment handling 1000 Shaping rolling 700 Burning welding 1000 Maintenance of boilers (inspecting, repairing, 1500 cleaning) Cribbing, setting equipment 200 Maintenance of heat exchangers, tube bundles and 1500 reboilers Safety (Continuous) TOTAL 8000 NOTE: Welding -- at Company's option a limited number of highly qualified individuals will be trained as certified welders in lieu of specialized Boilermaking ----------------------------------------------------------------------------- 82 EXHIBIT C APPRENTICESHIP AGREEMENTS INSTRUMENT/ELECTRICAL WORKER Safety -- JSA preparation SP bulletins work habits (Continuous) OSHA 1910.119 Class A Use of hand tools (Continuous) Rigging (Continuous) Use of test equipment (Continuous) Ordering material from stores (Continuous) Conduit Repair 300 Lighting -- relamping, blast repair, finding 500 shorts, and new installations Control Wiring -- Tracing, repair, and 500 troubleshooting Splicing wire -- 480 & 120V 50 Power wire 500 Motor troubleshooting 100 Motor controls 500 Understanding schematics, loops, wiring diagrams, 750 one lines, P&ID, and layouts Troubleshooting relays PLC's timers 500 Medium voltage equipment 1000 Splicing cables, transformers, switch gear, 0 capacitors, test equipment, and motors UPS systems and variable speed drives 200 Interlocks, alarms, shutdown switches, and 400 sequential events recorders N.E.C. -- grounding, explosion proof equipment 200 Fuses and circuit breakers 200 Repair and calibration of electronic equipment PC 0 boards, power supplies, digital controllers Control Valve and Shop Repair - actuators, 1000 positioners, I/Ps, limit switches, bench set, assembly, disassembly Transmitter repair, calibration, and 1950 troubleshooting with pneumatic, electronic, and digital instruments; temperature, flow, level, pressure, pH, and conductivity instruments and power supplies I/E System troubleshooting 1000 Loop tuning 150 DCS, and digital controller configuration 100 Preparing calibration control charts 100 TOTAL 10000 ---------------------------------------------------------------------- 83 EXHIBIT C APPRENTICESHIP AGREEMENTS IRONWORKERS Use and care of tools JOB Layouts, blueprints, and sketching CLASS Erection of steel COMBINED Burning and welding WITH Using chain falls, chokers, heavy equipment, crane BOILERMAKER signaling Fabricating steel (to include bending, rolling, and shaping steel and associated metals and use of shop equipment) Riggings -- including equipment and handling Reinforcing steel Safety TOTAL N/A ---------------------------------------------------------------------- MACHINISTS Use and Repair of Tools 80 Shaper 0 Lathe 600 Blue Prints/Layout 200 Milling Machine 200 Acetylene torch and welding 200 Metalizing 0 Balancing 100 Key Cutter 0 Surface Grinder 100 Drill Press 100 Do-all saw including blades 60 Pumps 2600 Turbines 900 Compressors 900 Gear reducers 400 Mixers, extruders, blowers 460 Miscellaneous 600 (including rigging, steam traps, gauge glasses, MICS, manlifts, and reverse indicator alignment) Safety (Continuous) Machine Tools 500 Shaft fabrication Bore coupling Thread cutting Key way cutting TOTAL 8000 ---------------------------------------------------------------------- 84 EXHIBIT C APPRENTICESHIP AGREEMENTS PAINTERS Use and care of tools 500 Materials 1500 Use and preparation, proper mixing, and matching 0 colors Sign painting 500 Exterior painting 1000 Interior painting 1000 Spray painting and spray painting equipment 1000 Wood and steel frame glazing 500 Paint coking 200 Rigging necessary for jobs 300 Stage and boatswain chair 0 Estimate materials 500 Use of sand blasting equipment 1000 Safety (Continuous) TOTAL 8000 ---------------------------------------------------------------------- PIPEFITTER Use and care of tools (Continuous) Pipe supports and pipe hangers 500 Blueprints, sketching, and layout 1000 Rigging and pipe assembly, process piping 1700 Installation Instruction on the following fundamentals will be given during the applicable work schedules listed below: 1) size of pipe; 2) schedule of pipe; 3) number of threads on pipe; 4) take off on fittings and valves and how used; and 5) different kinds of metal Underground 200 Use of hot tapping equipment and pipe machines 0 Screwed piping 500 Tubing and instrument fitting 800 Corrosion resistant piping 800 High pressure piping 1000 Steam and hot water piping 1000 Pipe bending (hot and cold) 500 Safety (Continuous) TOTAL 8000 NOTE: At Company's option, welding will be given to a limited number of selected individuals who would spend one-half year in the welding department. This training to be in lieu of specialized pipe fitting training and will not extend length of apprenticeship. ---------------------------------------------------------------------- 85 EXHIBIT C APPRENTICESHIP AGREEMENTS OPERATING ENGINEER Maintenance procedures 500 Care of engines and motors 500 Cables and rigging 500 Hoisting equipment 4500 Bulldozers 1500 Road maintenance equipment 500 Safety (Continuous) TOTAL 8,000 ---------------------------------------------------------------------- RELATED INSTRUCTIONS Each apprentice will attend classes in related instruction for a minimum of one hundred forty-four (144) hours per year for each year of his/her apprenticeship. If these classes are conducted at hours other than the scheduled working hours of the apprentice, these hours shall not be considered as hours of work, nor shall wages be paid for them. The Company will pay the cost of tuition for local specified trade courses on an equivalent amount toward the tuition for a course containing pertinent material accepted as related training. Materials, books, tools, and instruments required for classroom instruction shall be provided by the Company. Failure of the apprentice to attend regularly or to satisfactorily complete the assigned work shall be considered sufficient reason for the termination of his/her apprentice contract. NUMBER OF APPRENTICES TO BE EMPLOYED The maximum number of apprentices to be employed shall be determined by the Company to meet anticipated needs. If less than four (4) journey persons are employed in any craft, one (1) apprentice may be employed for that craft. If more than four (4) journey persons are employed in a craft the ratio will not be in excess of one (1) apprentice to every four (4) journey persons. The above ratio may be changed subject to the approval of both the Company and the Union. APPRENTICES WAGES -- APPRENTICE TO CRAFT PERSON The wage rate for apprentices shall be specified in the Apprentice Merit Progression Rate Schedule. PROGRESSION IN PROGRAM Merit increases will not be automatic but will be granted on the basis of demonstrated ability and all apprentices will be required to pass oral, written and field tests relating to the required skills and abilities of their crafts before each advancement. The craft apprentice representative will be present at the time of these examinations. 86 EXHIBIT C APPRENTICESHIP AGREEMENTS Apprentices may be given re-examination in thirty (30) days after a merit increase is withheld. If the apprentice fails the second examination, he/she will be terminated. MODIFICATION OF THESE STANDARDS These Standards of Apprenticeship may be amended at any time by negotiations between the Company and the Union providing such amendments meet the basic standards recommended by the Federal Commission of Apprenticeship. A copy of such amendment will be furnished each apprentice. CERTIFICATE OF COMPLETION Upon satisfactory completion of the requirements of apprenticeship, as established herein, the Company shall certify the names of the graduate apprentices to the Registration Agency, and recommend that Certificate of Completion of Apprenticeship be awarded. The foregoing Apprentice Standards are agreed to this 18th day of December, 1998. STERLING CHEMICALS, INC. Texas City, Texas TEXAS CITY, TEXAS METAL TRADES COUNCIL, AFL-CIO Registered as incorporating the fundamentals of apprenticeship recommended by the Federal Committee on Apprenticeship. ADMINISTRATOR U.S. Department of Labor Bureau of Apprenticeship and Training Date Filed___________________ 87 EXHIBIT C APPRENTICESHIP AGREEMENTS ATTACHMENT MAINTENANCE APPRENTICESHIP STANDARDS MAINTENANCE CRAFTS APPRENTICE AGREEMENT Apprentice:_______________________________________________________________ Craft:____________________________________________________________________ THIS AGREEMENT, entered into this _____ day of ______ , 19___, between the apprentice whose name appears above and Sterling Chemicals, Inc., Texas City, Texas, its successors and assigns, WITNESSETH THAT the Company and the apprentice, and his/her parents or guardian if he/she is a minor, desire to enter into an Agreement of Apprenticeship, and therefore, in consideration of the promises and of the mutual covenants herein contained do hereby mutually covenant and agree as follows: I) The Company agrees, during the period of the Agreement to: A) Furnish to the apprentice as broad a work experience as is practical within the craft named above and as is consistent with the duties performed by other employees in the craft and as is consistent with the apprentice's interest and his/her ability to master the skills involved. B) Pay the above named apprentice his/her regular contract rate of pay for the time he/she spends in actually performing work for the Company. C) Conform to provisions as stipulated in the "Maintenance Apprenticeship Standards" which shall be considered a part of this Agreement. II) The apprentice named above agrees to: A) Perform for the Company the highest quality of work of which he/she is capable. B) Abide by all applicable rules and regulations pertaining to safety practices. C) Conform to provisions as stipulated in the "Maintenance Apprenticeship Standards," which shall be considered a part of this Agreement. III) The parents or guardian agree to: A) Make all reasonable efforts to assure proper and diligent performance by the apprentice of all obligations assumed under this agreement. 88 EXHIBIT C APPRENTICESHIP AGREEMENTS The apprentice terms begins on the ______ day of ________, 19____, and terminates upon the successful completion by the apprentice of ______________ hours of employment for the Company in said craft, as stipulated in the "Maintenance Apprenticeship Standards." Credit for ______________ hours of previous training and experience toward apprenticeship is hereby granted this apprentice. This credit shall count toward the ___________ hours requirements. The amount of apprenticeship remaining is __________ hours. Explanation if any, of credit granted: ------------------------------------------------------------------------------ ______________________________________________________________________________ In witness whereof the parties hereunto set their hands. The foregoing Apprentice Agreement is agreed to this ______ day of ______ , 19_____. STERLING CHEMICALS, INC. TEXAS CITY, TEXAS ----------------------------------------------- (Signature) ----------------------------------------------- ------------------------ (Title) (Date) APPRENTICE ----------------------------------------------- ------------------------ (Please Print Name)) (Date of Birth) ----------------------------------------------- ------------------------ (Signature) (Date) ----------------------------------------------- ------------------------ (Parent or Guardian Signature) (DATE) Registered with the Federal Committee on Apprenticeship, United States Department of Labor. ADMINISTRATOR U.S. Department of Labor Bureau of Apprenticeship and Training 89 EXHIBIT C APPRENTICESHIP AGREEMENTS ADDENDUM MAINTENANCE APPRENTICESHIP STANDARDS SELECTION OF APPRENTICES Under 29 CFR Part 30.5(4) Alternative Selection Method The recruitment, selection, employment and training of apprentices during their apprenticeship shall be without discrimination because of race, color, religion, national origin, veteran status, disability or sex. The sponsor will take Affirmative Action to provide equal opportunity in apprenticeship and will operate the apprenticeship program as required under Title 29 of the Code of Federal Regulations, Part 30. BASIC QUALIFICATIONS Applicants for apprenticeship must meet the following requirements: Be of legal working age (if under 21 years of age, must be willing to have parent or guardian signature on apprenticeship agreement). 1) Have a high school diploma or GED. 2) Have twelve (12) college credit hours (six (6) hours math, six (6) hours science) with a 2.5 GPA. 3) Be willing to take an American Petroleum Institute (API) test through the College of the Mainland. 4) If and when selected, applicant must be willing to take and pass a Company physical examination and drug test. SELECTION PROCESS 1) All resumes will be screened for basic qualifications. 2) Only applicants meeting basic qualifications shall be eligible for testing. 3) Test will be administered by the College of the Mainland and the scores released to Human Resources. 4) Notice to appear for interviews will be by phone, giving date, time and place for interview. FAILURE TO APPEAR FOR AN INTERVIEW WITHOUT SUFFICIENT CAUSE SHALL RESULT IN CANCELLATION OF APPLICATION. 90 EXHIBIT D EMPLOYEE BENEFITS The COMPANY agrees to continue to provide employee benefits under the following plans as in effect on December 1, 1998: Sterling Chemicals, Inc. Medical Benefits Plan for Hourly-Paid Employees Sterling Chemicals, Inc. Prescription Drug Benefits Plan for Hourly-Paid Employees Sterling Chemicals, Inc. Dental Assistance Plan for Hourly-Paid Employees Sterling Chemicals, Inc. Hourly Employees' Flexible Spending Account Plan Sterling Chemicals, Inc. Disability Benefits Plan for Hourly-Paid Employees Sterling Chemicals, Inc. Group Life Insurance Plan for Hourly-Paid Employees Sterling Chemicals, Inc. Medical Benefits Plan for Retirees Sterling Chemicals, Inc. Prescription Drug Benefits Plan for Retirees Sterling Chemicals, Inc. Hourly-Paid Employees' Pension Plan Sterling Chemicals, Inc. ESOP Sterling Chemicals, Inc. Savings and Investment Plan Nothing in this Agreement shall restrict the COMPANY from changing the language in the official plan documents or changing the providers of plan benefits as long as the benefits provided are not changed (unless required by law.) The COMPANY will not provide retiree life insurance benefits for employees who retire after March 1, 1999. Employees, who retired on or before that date will continue to have the same amount of retiree life insurance with which they retired. Note: Employees who retire on or before 3/1/99 will be eligible for retiree medical insurance at the grandfathered active employee rates. This exception will last for the duration of this agreement and will be subject to change as negotiated in future contracts. Employee dental premiums shall increase 10% each year for 2000, 2001, and 2002. For retirees who retire after March 1, 1999, retiree medical premiums will equal 50% of projected expenses and be based upon the medical claims, prescription drug claims and stop-loss insurance premiums attributable to participants in the retiree medical plan. For retirees who are currently retired or elect to retire on or before March 1, 1999, retiree medical premiums will equal active employee medical premiums; however, retirees who retired before 4/1/91 under the terms of the "old" retiree medical plan will continue to pay the same retiree medical premiums as they are paying on December 1, 1998. Active employee medical premiums will remain at 15% of projected expenses and be based upon the medical claims, prescription drug claims and stop-loss insurance premiums attributable to participants in the active medical plan. 91 Medical Coverage - Coordination of Benefits applicable to actives and to "new plan" (generally 4/1/91 and after) retirees: Change coordination of benefits from standard to carve-out. This means that in situations where the Sterling Medical Plan is secondary, total benefits from both plans will be limited to the amount the Sterling Plan would have paid had it been primary. The COMPANY shall make available an HMO for employees. Employee premiums shall equal 15% of the billed cost to the COMPANY by the HMO. If the COMPANY should decide to provide HMO benefits on a self-insured basis at a later date, the COMPANY agrees to use a similar methodology to calculate HMO employee premiums as is used for the non-HMO plan. 92 EARLY RETIREE INCENTIVES Until February 16, 1999, the Company agrees to provide a "5&5" pension incentive to eligible employees as follows: Eligible employees are those who have met ALL of the following conditions: a) is actively employed (or on layoff status) on December 17, 1998 b) is at least age 50 by January 31, 1999 c) has at least 5 years of vesting service by January 31, 1999 d) has signed and returned (and has had notarized) a Severance and Release Agreement prepared by the Company e) elects to retire by March 1, 1999 Eligible employees will be entitled to the following: a) 5 years will be added to their age in the Pension Plan b) 5 years will be added to their Benefit Service and Vesting Service in the Pension Plan c) no early retirement reduction will be applied to their pension (even if not Combo 80) d) they will be eligible to enroll in the retiree medical plan PENSION The maximum pension factor will be increased to: EFFECTIVE DATE PENSION FACTOR December 31, 1998 $60 93 VACATION YEAR TRANSITION Vacation available to be taken during 1999: a) all unused vacation at end of 1998 plus b) 3/4 of a year vacation allotment earned in 1998 For employees hired before January 1, 1996, vacation year allotment will be based on years of service accrued by March 31 following the end of the vacation year. For all other employees, vacation year allotment will be based on years of service accrued by December 31 of the vacation year. RATIFICATION BONUS All hourly employees actively employed (or on layoff status) will receive a Ratification Bonus payable upon successful Ratification of the Labor Agreement in the amount of $1000.00. 94 MAINTENANCE OVERTIME PROCEDURE MANAGING OF MAINTENANCE OVERTIME Maintenance employees will clock in and out at the zone maintenance shop. HOLDOVER OR SCHEDULED OVERTIME Personnel will declare their overtime preference daily. If they "OK" for overtime, they will be scheduled to work. The zone maintenance planner or xxxxxxx will schedule and assign overtime using zone personnel (those who declared their preference to work) on the basis of low hours worked and skills required to perform the job. If unable to fill the job within the zone, employees on the volunteered, pre-committed list will be scheduled. The I/E Qualification List will be used. If the job can not be staffed, the job may be contracted or zone employees may be forced to hold over. For job continuity, jobs started by contractor personnel will be worked to completion by the contractor. EMERGENCY CALL OUTS The plant will have an on-call system for notifying volunteered, pre-committed personnel during off hours. Zone supervision will determine the number of employees required to be on call at any given time. (After the telephone, use of a pager is the most likely tool for contacting personnel). The operations xxxxxxx, maintenance xxxxxxx or planner, or their designees will call the on- call personnel to respond to emergency call outs. The on-call personnel must respond immediately. It is the responsibility of the on-call employee to pre- arrange for a substitute before leaving the plant if he/she will not be available. If unable to fill the requirement with the on-call personnel, the job may be contracted to completion or employees from the home zone may be forced out on the basis of low hours worked. The I/E Qualification List will be used. ANALYZER The analyzer craftsmen will work overtime in their assigned zone. If additional manpower is required, the low person from the analyzer group with the needed skills will be scheduled on the basis of low hours worked. In addition, each SBU will have a designated on-call person. ELECTRICAL LINE CREW / MOTOR CREW The electrical line crew and the motor crew are part of Zone 4/Central Shops service organization and are included in that overtime pool. Line crew and high voltage motor work will be offered and assigned to this group. PM CREW Critical equipment repairs will be scheduled for the PM crew. If unable to properly staff the job, the job may be contracted. SHUTDOWNS / TURNAROUNDS The company reserves the right to contract shutdown/turnaround work. Employees from within the affected zone may volunteer to work parts of the shutdown/turnaround. They may also be assigned to shifts by reverse craft seniority, as needed, to execute the work. 95 NO JURISDICTION SUPPORTING INFORMATION 1. Operators perform CLAIR, TPM, and minor maintenance. Examples: . help Machinist pull and install pump . pull small pump and decontaminate . pull small control valve up to level of skill and ability . install and pull blinds for product changeover and to prepare equipment (small number of blinds) 2. Maintenance planners plan total hours to perform job. 3. Maintenance xxxxxxx assigns jobs based on skill and ability. You could have crews of all one craft or mixture of crafts. Crew would secure permits, get necessary materials, communicate with xxxxxxx and operations. 4. General Mechanic classification set up to increase skill level of Painters, Laborers, Asbestos Workers, Carpenters, and Stores personnel who choose to transfer to the Laborers. They would learn low, medium, and some high skills of primary skill groups. Support personnel would be trained, tested, and certified to become a General Mechanic. General Mechanic would help primary skill craftsmen or perform the jobs outright up to their level of skill and ability. 5. Depending on jobs scheduled, General Mechanics may perform support work by themselves or with help from primary group. 96