Collective Bargaining Agreement, Approved February 13, 2003

EXHIBIT 10.31


COLLECTIVE BARGAINING AGREEMENT


BETWEEN THE


PUERTO RICO TELEPHONE COMPANY


AND THE


INDEPENDENT UNION OF


TELEPHONE EMPLOYEES OF PUERTO RICO


EFFECTIVENESS:


FROM JANUARY 18, 2003


UNTIL JANUARY 17, 2006


ARTICLE 1
RECOGNITION OF THE UNION


SECTION 1


The Company recognizes the Union as the exclusive representative for all the employees included in the bargaining unit, such as it is defined in Article 2 (Bargaining Unit) for purposes of the Collective Bargaining Agreement with regard to the rates of compensation, salaries, work hours, employment tenure, grievances and other employment conditions.


SECTION 2


For purposes of this Collective Bargaining Agreement, the terms "worker" and "employee" shall be interchangeable, reason why they will be utilized alternatively in singular as well as in plural.


ARTICLE 2
APPROPRIATE UNIT (BARGAINING UNIT)


SECTION 1


The employees covered by this Collective Bargaining Agreement henceforth referred to as the "Employees", shall be all the non-supervisor employees, including all the regular employees, the temporary ones, Messengers or Mail Office Clerks (certified by the National Board in case number 24-RC-4380 of August 9, 1971) and all those positions which have been included in the Appropriate Unit by the Labor Relations Board from that date onwards; and all the employees included in the Certification of the Labor Relations Board (case number P-96-1D-96-1257) dated July 10, 1996: Administrative Office Clerks, Administrative Assistants, Executive Receptionists, Document Filing Clerk, Document Assistant, Phone Card Office Clerk, Coordinator of Materials, Verifier of Invoices, Librarian for the Data Center and Transportation Analysts. Excluding all the Executives, Officers, Administrators, Supervisors, Department Directors, Managers, Heads of Divisions, Sections, Zones, Districts and Geographical Sub-Divisions, Security Guards, Employees from other Appropriate Units, all personnel with capacity to hire, fire, promote, discipline or in another manner vary the status of employees or make recommendations to that effect, office employees intimately linked to the management, employees of trust, including Secretaries for the Officers, Executives, Administrators, Department Directors, Managers, all the employees from the Department from Labor and Employee Affairs, Salesmen on a Commission basis, Payroll Office Clerk, Employees from the Department of Client Affairs, Executive Receptionists from the Office of the President, Administrative Office Clerks from the Office of the Vice-President of Operations, Administrative Assistants from the Office of the Vice-President for Network Planning and Engineering, from the Office of the Vice-President for Business Services, from the Office of Treasury Operations, from the Department for Corporate Security and any other positions which functions imply responsibilities equal to those of positions which are excluded in the Bargaining Unit and the Supervisors according to how they are defined by the Law.


SECTION 2


The titles mentioned above shall not limit the exclusion in the future of positions which functions imply responsibilities equal to those excluded above, including the ones that have the functions of a confidential nature (positions of trust), in accordance to how these have been defined under the labor jurisprudence.


SECTION 3


The Company shall send the Union, on or before the following sixty (60) days of each year that this Collective Bargaining Agreement is in effect, a listing of all the positions by levels, included in this Bargaining Unit, with the names of the ones holding the positions, entry dates, postal address and their present salary.


ARTICLE 3
RIGHTS OF THE MANAGEMENT


SECTION 1


The Union recognizes that the administration of the Company and direction of the working force are the exclusive prerogative of the Company. Therefore, except as expressly limited by the terms of this Collective Bargaining Agreement, the Company retains and shall retain the exclusive control of all the matters concerning the operation, handling and administration of its business, including, but without having this being interpreted as a limitation, the administration and handling of its departments and operations, the work organization and methods, the processes, methods and procedures for the rendering of service, the determination of the equipment, parts and services to be purchased, the assignment of working hours, the direction of the personnel, the right to employ, classify, re-classify, transfer and discipline employees, and all the functions inherent to the administration and/or handling of the business.


SECTION 2


If it is the understanding of any employee that he has been treated in a discriminatory, arbitrary or unfair fashion in accordance to the terms of this contract or any provision of this contract has been violated by any action taken by the Company by virtue of the preceding section, such allegation shall be submitted by the Union or by the employee to the Grievance Procedure established in this Agreement.


ARTICLE 4
UNION SHOP


SECTION 1


All employees who are covered by this Agreement who as of the date of the signing of the same are a member of the Union, shall be obligated as a condition of employment to continue as members of the Union and, in the case of new personnel, these shall be obligated as a condition of employment to join the Union within the thirty (30) days following their working for the Company and in both cases, to pay dues to the Union during the effective period of this Agreement.


SECTION 2


The Company, at the written requirement on the part of the Union, shall dismiss or suspend from their job any employee who is not affiliated or who does not continue being affiliated as a bona-fide member of the Union. Said written requirement must be notified to the Company by certified mail and with a copy to the affected employee by certified mail.


SECTION 3


The Company shall post a copy of this clause in visible places in its different departments in the Island of Puerto Rico, for knowledge of the personnel.


SECTION 4


In the event that a competent entity determines that the separation to which Section 2 of this article refers was unjustified or illegal, the Union shall be the only one responsible for all the damages caused by said dismissal, and the Union will safeguard the Company and reimburse it for any expense or outlay in which the Company may incur as a result of said dismissal.


SECTION 5


The Company and the Union agree that the Union shall have the opportunity to meet during thirty (30) minutes with the recently hired employees, as part of the general orientation process, for the purpose of supplying them with information about the Union and the Collective Bargaining Agreement. The time invested during the regular work shift of each employee given orientation shall be paid as time worked. This orientation shall be carried out during the fifteen (15) days following the entry of the union member employee, or from the time that the Company notifies the entry, whichever is greater.


ARTICLE 5
DUES CHECK-OFF


SECTION 1


During the effectiveness of this Collective Bargaining Agreement, the Company commits itself to automatically deduct from the salary received by all the employees covered by the definition of the Bargaining Unit, the sum of the initiation dues, the regular dues and any uniform special dues which the Union establishes for its members after receiving the written authorization on the part of the employee. The authorization for the regular dues shall be for a minimum term of one (1) year and shall be extended year after year, while the employee occupies a position within the Bargaining Unit. This authorization shall be irrevocable for a period of one (1) year from the date of the authorization. The Union shall notify the Company in writing with regard to the dues to be checked off from the employees covered by this Agreement. The Union shall comply with all the applicable procedures and laws prior to the establishment of said dues and the sum of said deductions shall be deposited within a term which shall not exceed five (5) calendar days, after carrying out the bi-weekly deduction by means of a direct deposit to the UIET's bank account, it being provided that the Company will do everything possible to make the deposit on the next working day.


SECTION 2


a) The Company will send the Treasurer of the Union or the Officer
designated by him, after rendering the bond required by law, the
document evidencing the deposit of the amount of the corresponding
dues during the ten (10) calendar days after the payment of every
two (2) weeks has been made except when there are extraordinary
circumstances intervening in which case the term shall not exceed
ten (10) additional days. The Company shall send the Union a summary
every two (2) weeks with the names of the employees who have had
said deductions made, in addition, containing the individual sum and
the total of the same. The Company will check off the initiation
dues in the amount and installments certified by the Union for all
employees joining the Union, after receiving the written
authorization from the employee.


b) The Company shall not forward dues until the Union has shown it that
the Treasurer or the designated Officer have rendered the bond
required by law.


c) In all cases of suspension or dismissal in which an Arbitrator,
court or administrative entity has determined that the suspension of
the employee or the dismissal of the employee was not justified and
has ordered the reinstatement of the employee with all the total or
partial salaries that it did not receive in cases of dismissal or
has ordered the total or partial payment of the salaries not
received during the suspension, the Company must deduct from said
payment the total of the Union dues not paid by the employee during
the time that the employee was dismissed or suspended, as the case
may be, and forward its sum to the Union in conformity to this
article.


d) In addition, the parties agree that in those cases of suspension or
dismissals that were settled and as part of the agreement the total
or partial payment of salaries not received by the employee have
been agreed upon, the Company must also deduct from said pay the
total of the Union dues not paid by the employee during the time
that the employee was dismissed or suspended and to forward its sum
to the Union in the terms stated above.


e) With regard to the deduction of dues to which reference is made in
paragraphs c) and d) of this section, it shall be the obligation of
the Union to notify the Company on a timely basis about the total
sum of dues that the employee is to have checked off.


SECTION 3


In the event that any competent entity determines that any dues have been illegally set or deducted, the Union shall release the Company from all liability and shall indemnify and pay directly any reimbursement ordered by said entity.


SECTION 4


During the effective period of this Collective Bargaining Agreement, the Company shall send the Union, on a monthly basis, a report regarding the employees who are enjoying any of the leaves established in this Collective Bargaining Agreement, which duration shall be of thirty (30) calendar days or more, with said report having to state the name of the employee and his number, the position occupied by him, the department, the work center, the leave which he is enjoying and up to where it is possible, the duration of the leave stating the possible return date.


SECTION 5


During the effective period of this Agreement, the Company must check off the Union dues in all those cases in which an employee from the bargaining unit is enjoying the benefits of any of the leaves with pay acknowledged in the Agreement, except under the Prolonged Illness Leave, (Act 139), and forward its sum on the basis of the terms stated above, it being provided that in those cases under Act 139 (SINOT), the Company, once the employee has returned to his job, must withhold the Union dues that were not paid by the employee during said leave and forward their sum to the Union in the terms stated in this article. The total of said check offs must be made during the first three pay periods.


ARTICLE 6
COOPERATION ON THE PART OF THE UNION


The Union, as well as its members, agree to promote, at all times and as fully as possible, good service and efficient operation. The Union and its members also agree with the Company to produce maximum production during each daily work shift.


ARTICLE 7
PRODUCTIVITY


The Union and the Company acknowledge that productivity must be increased to confront the competition in the telecommunications services.


To that effect, the Union agrees that the employees who are Union members shall commit themselves to render the maximum of their productivity, attendance, timeliness, efficiency and effectiveness with order and discipline. All of it in accordance to Article 6, Cooperation on the part of the Union.


The Company will carry out all possible efforts to provide the means and resources necessary so that the employees can attain the productivity objectives established.


ARTICLE 8
DELEGATES OF THE UNION


SECTION 1


The delegates and their sub-delegates in their substitution, shall represent the Union in the process of administrating the Collective Bargaining Agreement before the Company.


The delegates shall provide orientation to the employees covered by this Collective Bargaining Agreement with regard to their responsibilities and rights; in like manner they shall watch out and be empowered to help their co-workers when these have a complaint or grievance or when their presence is required by any boss or supervisor.


SECTION 2


The Union delegates shall be limited to handling the grievances and matters related to the application of the Collective Bargaining Agreement in their work area.


SECTION 3


No delegate may intervene in another department or area that is not one for which he has been designated, with the exception of those work areas or departments where no delegate has been appointed, in which case the delegate from another nearby department may act as the appointed delegate in that other operational unit or department, as long as he has been previously authorized in writing by the President of the Union or his authorized representative.


The Union shall be entitled to appoint sub-delegates or substitute delegates who shall act only in the absence of the appointed delegate.


SECTION 4


The delegate shall utilize the time adequately for the quickest solution of the grievances. When it is necessary for a Union delegate to deal with a grievance or related matter, the delegate must:


a. Notify his immediate supervisor with reasonable time to stop taking
care of his regular work and taking care of the grievance or related
matter.


b. The delegates shall receive up to a maximum two (2) hours for each
grievance. When a delegate is required by the Management to handle
some specific matter related to the Collective Bargaining Agreement,
the time devoted by him to the attention of said matter, shall not
be deducted from his salary. It being provided, that the meeting
time may be limited by the Management.


The Union binds itself to comply and promote faithful compliance with this article in such manner that the time requested by the delegate be utilized exclusively for the aforementioned purposes.


The Company, on its part, may take the actions and measures that it deems necessary and relevant in such manner that faithful compliance be given to the provisions of this article, including having the time requested by a delegate to be utilized exclusively for the purpose stated above.


c. Return to his job upon finishing dealing with the manner if his work
schedule has not ended.


d. The meetings between the delegate and the employee requiring his
services in accordance with this Agreement, work shall be carried
out in the areas near the employee's work area.


e. When it is necessary to have a delegate hold a private conversation
with an employee during time with or without pay on the part of the
Company to process a grievance or to deal with a matter relating to
the application of the Collective Bargaining Agreement in accordance
to the Grievance Procedure, the express authorization from the
supervisor must be obtained.


f. The Company agrees to provide the Union with adequate facilities at
each work site where the same exists and which are available for the
purpose of having its functionaries, delegates or agent being able
to hold meetings relating to grievances from the concerned area or
department.


SECTION 5


When the Company expands its services creating additional units and increasing in a substantial manner the personnel in the additional services, the parties, after previous agreement, shall reach an agreement regarding the appointment of the corresponding delegates.


SECTION 6


The delegate shall represent the employees covered by this Collective Bargaining Agreement when the employee so requires it in the different stages of the Procedure for Grievances, with the President of the Union or any member of the Board of Directors being able to participate in said representation.


SECTION 7


The Company shall not acknowledge any delegate until the President or Vice-President of the Union has informed the Director of Labor and Employee Affairs about it in writing and the delegate has received his appointment.


The delegates will have to be regular employees of the Company.


SECTION 8


The parties shall reach an agreement with regard to the schedule, number and place where the delegates shall act. It being provided that there shall not be more than one delegate and one sub-delegate in functions per each operational unit of the Company, with the exception of the Traffic Department in which centers the delegates and sub-delegates necessary to insure that the employees are duly represented may be appointed.


SECTION 9


The President or the Vice-President of the Union may appoint General delegates, in conformity with the preceding section 7 and these shall receive the same treatment, respect and courtesy that should be rendered to the Officers of the Union.


The General Delegates shall be appointed to represent and substitute the officers of the Union and when they visit the shop or specific area to which they have been appointed, they shall have all the prerogatives that the Officers of the Union have. The General delegate must comply with what is provided for in Section 4 of this article.


ARTICLE 9
VISITS FROM UNION OFFICERS


SECTION 1


The President of the Union, the members of the Board of Directors and the members of the Elections Committee shall have access to the Company's premises during working hours, for the purpose of resolving grievances, investigating work conditions and verifying the compliance with this Collective Bargaining Agreement. The members of the Elections Committee, during periods of reunions for internal elections of the shall have access to the Company's premises for the sole purpose of administrating and coordinating said elections. In addition, it is agreed that the members of the Union's Discipline Committee shall have access to the Company's premises during working hours, for the sole purpose of carrying out the functions relevant to said Committee, it being provided that prior notice shall be given, with less in writing, of no lesser than 24 hours, to the Director of Labor and Employee Affairs.


SECTION 2


Upon arriving at the area to be visited, the President, members of the Board of Directors, members of the Elections Committee or members of the Discipline Committee, shall identify themselves and inform the purpose of their visit and shall go in person before the officer of the Company that they are going to be visiting or to the representative appointed by them.


SECTION 3


The President of the Union may appoint agents or representatives to carry out any of the functions of said Board. The Company shall not recognize as such an appointed agent or representative until the President of the Union has notified the Director of Labor and Employee Affairs in writing about his designation as such, including a description of the matters which said agent or representative shall be authorized to handle in the Union's name.


The representatives appointed by the President of the Union shall be acknowledged by the Company and these shall receive the same treatment, respect and courtesy that should be rendered to the officers of the Union, it being provided that these agents or representatives shall have access to the Company's premises for the purpose of handling the matters authorized to be handled in the Union's name. Upon the arrival of the agent(s) or representative(s), he shall identify himself and inform the purpose of his visit and shall appear in person before the Officer of the Company that he is going to be visiting or the representative designated by him.


ARTICLE 10
PERSONNEL ACTIVITIES


SECTION 1


The Company and the Union agree that the employees or representatives of the Union shall not be allowed to carry out propaganda or Union activities of any nature whatsoever during their working hours within or outside the Company premises, except those expressly contained in this Collective Bargaining Agreement.


SECTION 2


No union propaganda or activity of any nature whatsoever shall be allowed within the Company premises on the part of the employees, the Union delegates and officers during their free time, if by doing so it causes about one or more of the following conditions:


a. Interrupts or distracts the work of the personnel which is working.


b. Constitutes a disturbance or harm to the Company.


c. Causes a situation of disorder or violence.


SECTION 3


The Company and Union the agree that the working hours are for each employee to devote to his work for the Company and therefore, it is not allowable to dedicate working time to matters which are foreign to work such as, for example: discussions about sports, politics, religion, etc. Neither are such activities allowable during the employee's free time but within the Company's premises if that causes one or more of the conditions in clauses a, b and c of the preceding section.


SECTION 4


No employee shall have access to the Company buildings or premises without prior express authorization from the Supervisor of the site or the Director of Labor affairs, except to his regular work site and during his regular work schedule. In the event of receiving such authorization, the employee must be accompanied at all times by said Supervisor or by the person designated by him unless the Supervisor or the person designated by him determines, at his discretion, that it is not necessary to accompany him and so informs it verbally to the visiting employee. Under no circumstance will the employee be authorized to enter onto Company property if there is no Supervisor, or the person designated by him available to accompany the him.


ARTICLE 11
PUBLICATION, ADJUDICATION OF POSITIONS
AND APPOINTMENTS, PROMOTIONS AND TRANSFERS


SECTION 1


The Company shall publish visible and accessible in bulletin boards that allow the ample divulgation at all work centers, the positions of new creation, the vacant ones or the ones which could be left vacant in the near future, corresponding to the bargaining unit that they are going to cover, specifying the requirements for the same. The publication of the positions shall be made for a term no lesser than five (5) working days. The Company shall send to the Union a copy of said publication. A position so published shall not be canceled without notifying the Union about the reasons for its cancellation.


SECTION 2


Any regular employee, who meets the requirements for a published position, may apply for the same by submitting the corresponding application, in the form supplied by the Company, within the term established in the publication, to the Recruiting Department, with return receipt requested. It being provided that those employees who work outside of the


buildings of Plaza Telefonica (1500, 1513 and 1515 Roosevelt) shall count with a term of two (2) additional working days after the closing of the publication.


SECTION 3


The Company shall only consider those employees who meet the requirements, who have filed the petitions within the period established in the publication, and who may fulfill the functions of the position immediately upon having it adjudicated to them; or if they are enjoying their vacation leave, upon the conclusion of the same; or if they are receiving benefits under the State Insurance Fund or using sick leave, within thirty (30) days after it has been adjudicated to them.


SECTION 4


Any vacant position or a position of new creation shall be adjudicated to the employee who qualifies pursuant to what is provided in Section 6 of this article within the following order of priority, except in the case of promotion or transfer from one classification to another, where seniority shall not be the determinant criterion for the adjudication of the position:


a. Employees who are going to be affected by personnel reductions.


b. Employees who have suffered an occupational illness or accident that prevents them from carrying out the functions that they used to carry out in their positions prior to said illness or accident. This priority shall not have the scope of extending the term of time provided by law within which an employee reserves his job tenure from the time of the occupationa ...