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Sectors: Chemicals
Effective Date: November 12, 2004
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AGREEMENT

between

The United Steelworkers of America International Union, AFL-CIO, CLC, Cherokee Local No. 417-G

and

Cherokee Nitrogen Division Of El Dorado Chemical Company November 12, 2004 to November 11, 2007 CONTENTS

Page No.

AGREEMENT (Preamble) 1 ARTICLE 1 - RECOGNITION 1 ARTICLE 2 - PURPOSE 1 ARTICLE 3 - MANAGEMENT RIGHTS CLAUSE 2 ARTICLE 4 - WORK GROUPS 2 ARTICLE 5 - SENIORITY 4 ARTICLE 6 - POSTING AND FILLING JOB BIDS 5 ARTICLE 7 - REDUCTION IN FORCE AND RECALL 6 ARTICLE 8 - SCHEDULE CHANGE 8 ARTICLE 9 - HOURS OF WORK 8 ARTICLE 10 - OVERTIME 8 ARTICLE 11 - 12-HOUR SHIFT AGREEMENT 12 ARTICLE 12 - ABSENCES 12 ARTICLE 13 - WAGES 13 ARTICLE 14 - SHIFT DIFFERENTIAL 14 ARTICLE 15 - VACATIONS 14 ARTICLE 16 - HOLIDAYS 16 ARTICLE 17- FUNERAL LEAVE PAY 17 ARTICLE 18 - JURY DUTY 17 ARTICLE 19 - PAYDAY 18 ARTICLE 20 - MEAL ALLOWANCE PROVISIONS 18 ARTICLE 21 - WORKMAN'S COMMITTEE 19 ARTICLE 22 - GRIEVANCE PROCEDURE 19 ARTICLE 23 - LEAVE OF ABSENCE 21 ARTICLE 24 - MILITARY SERVICE 22 ARTICLE 25 - SAFETY AND HEALTH 22 ARTICLE 26 - DESCRIMINATION 23

ARTICLE 27 - BULLETIN BOARDS 23 ARTICLE 28 - SICKNESS BENEFITS 23 ARTICLE 29 - DISCHARGE 24 ARTICLE 30 - GENERAL 25 ARTICLE 31 - AUTHORIZED DEDUCTION 25 ARTICLE 32 - SAVINGS CLAUSE 26 ARTICLE 33 - STRIKES AND LOCKOUTS 26 ARTICLE 34 -TERM 26 APPENDIX "A" (Wage Rates) 30 APPENDIX "B" (12-Hour Continuous Shift Operations Agreement) 31 APPENDIX "C" (401(k) Savings Plan) 33 APPENDIX "D" (Alcohol and Drug Control Policy)

34

LETTER OF UNDERSTANDING (Red Circle Personnel)

35


AGREEMENT

This Agreement was made and entered into this twelfth day of November, 2004, by and between Cherokee Nitrogen Company, Cherokee, Alabama, hereinafter called the "Company" and The United Steelworkers of America International Union AFL-CIO, CLC on behalf of its Local Union 417-G, hereinafter called the "Union."

ARTICLE 1

RECOGNITION

Due to the Company's hiring individuals, all of which were previously employed in the Cherokee Nitrogen facility, where the Company currently operates, the Company has recognized The United Steelworkers of America International Union AFL-CIO, CLC and its Local Union No. 417-G, hereinafter called the "Union," for purposes of pay, wages, hours of work, and other terms and conditions of employment for employees in the following unit: all hourly-paid production and maintenance employees at the Company's Cherokee, Alabama plant, but excluding journeyman electricians and instrument person, their apprentices and/or electrician or instrument mechanics helpers, clerical employees, professional, technical, managerial, and confidential employees, guards, and supervisors as defined in the Act.


Whenever reference is made to a particular gender in this Agreement, it is understood that the reference applies equally to both male and female employees.

ARTICLE 2

PURPOSE

A. The parties hereto mutually agree that there is concern for the future of the Company and its ability to compete in a the nitrogen fertilizer industry because of factors over which neither the Union nor the Company have control, including but not limited to foreign competition, excess domestic production capability, natural gas prices, and the cyclical nature of product utilization by consumers. Each agrees that our mutual goal is to provide the highest quality product and service at a competitive price, and to assure the effective flexibility in the utilization and skills of all employees.

B. It is the intent and purpose of the parties hereto that this Agreement shall promote and improve the industrial and economic relationship between the Company and the Union, and shall set forth herein rates of pay, hours of work, and working conditions of employment to be observed between the parties hereto.

C. It is recognized by both parties that they have a mutual interest and obligation in maintaining friendly cooperation between the Company and the Union which will permit safe, economical, and efficient operation of the plant.

D. All written Letters of Agreement which are dated prior to the effective date of this contract are null and void unless specifically added to this contract.

ARTICLE 3

MANAGEMENT RIGHTS CLAUSE

The Union expressly recognizes that the Company has the exclusive responsibility for and authority over (whether or not the same was exercised heretofore) the management, operation, and maintenance of its facilities and, in furtherance thereof, has, subject to the terms of this agreement, the right to determine policy affecting the selection, hiring, and training of employees: to direct the work force and to schedule work: to institute and enforce reasonable rules of conduct, to assure discipline, and efficient operation: to determine what work is to be done, what is to be produced and by what means; to determine the quality and quantity of workmanship; to determine the size and composition of the work force; to determine the allocation and assignment of work to employees; to determine the location of business, divisions, and subdivisions thereof; to arrange for work to be done by other companies or other divisions of the Company; to alter, combine, or eliminate any classification, operation, service, or department; to sell, merge, or discontinue the business or any phase thereof; provided, however, in the exercise of these prerogatives, none of the specific provisions of the Agreement shall be abridged.

The Company will not use the vehicle of subcontracting for the sole purpose of laying off employees or reducing the number of hours available to them.

ARTICLE 4

WORK GROUPS


A. Grandfathering and red circle personnel are covered in a Letter of Understanding.

B. OPERATIONS SKILL ADVANCEMENT/ON-THE-JOB TRAINING.

1. In the interest of maintaining and improving operating efficiencies, the following is the standard for inception and advancement.

2. Levels of advancement are as follows:

a. Trainee - If a new hire cannot complete the qualifications according to the following schedule, they will be terminated.

b. Chemical Operator 1 - Required to pass necessary requirements as determined by management, for one (1) assignment which will include written and oral examinations and demonstration of job proficiency. Must qualify within 240 hours of training on day shift.

c. Chemical Operator 2 - Required to qualify by passing the second assignment by written and oral examinations, and demonstration of job proficiency. Must qualify within one (1) year after passing Operator 1 qualifications.

d. Chemical Operator 3 - Required to pass all area assignment written and oral examinations within an area, and by demonstrating job proficiency on all assignments. Must qualify within one (1) year after passing Operator 2 qualifications.

e. Chemical Operator 4 - Required to pass all area assignment written and oral examinations within an area, and by demonstrating job proficiency on all assignments. Must qualify within eighty (80) calendar days after passing Operator 3 qualifications and be certified as having completed Cherokee Nitrogen training programs.

3. JOB BIDS.

a. Job bids will be made to a primary assignment and shift. The senior bidder will be awarded the job as a trainee or based on Article 4, Section B.2 qualifications. The company will no longer canvass bidders to determine acceptance. b . An employee will be allowed one (1) successful bid per six (6) month period.

c. An employee who is awarded a job for which he/she is previously qualified will be provided 84 hours of refresher training.

d. Vacancies will be filled on the basis of plant seniority. Fulfillment of assignment requirements by the successful bidder will be determined by management. Bid acceptance will require that the successful bidder qualify on the Chemical Operator Level 1 within 240 training hours. Prior training and experience will allow generally for a shorter training time to pass the exams for the next operator level.


C. ROUTE OF ADVANCEMENT - OPERATIONS.

Switch Ammonia Acid Urea Nitrate Crews Chemical Operator 4 X X X X (1)* Chemical Operator 3 X X X X (1)* Chemical Operator 2 X X X X X Chemical Operator 1 X X X X X Trainee

New Hire after 8/31/94 X X X X X

(1)*To qualify for this level, the switching and rail crew members must qualify for the shipping, bagging, and load-out of products in the Nitrate and Urea areas.


D. MAINTENANCE WORK GROUPS.


1. In the interest of maintaining and improving plant on-stream time, the following is the standard for maintenance inception and advancement:


2. The Company will provide on-the-job training necessary to acquire job skills at each level. Levels of advancement are as follows:

a. Maintenance Trainee - A new hire will be required to pass the skill levels established August 31, 1994 (document entitled "Training Program - General Mechanic") in order to advance to Maintenance Level 1. A new hire who does not complete the qualifications will be terminated. Must successfully complete and pass written and practical factors tests, as determined by Management.

b. Maintenance Level 1 - Must be qualified and proficient in one (1) major skill as determined by management, and must pass written and practical factors tests, as determined by Management, (i.e. General Mechanic, Certified Welder, Machinist, Auto Mechanic, Millwright, etc.).

c. Maintenance Level 2 - Must be qualified and proficient in two (2) major skills, and written and practical factors tests, as determined by Management.

d . Maintenance Level 3 - Must be qualified and proficient in three (3) major skills, and written and practical factors tests, as determined by Management.

e . Maintenance Level 4 - Required to be a Level 3 and certified by written and practical factors tests, as determined by Management.


E. ROUTE OF ADVANCEMENT - MAINTENANCE.


Maintenance Level 4 Maintenance Level 3 Maintenance Level 2 Maintenance Level 1 Mechanic 3rd Year Trainee Mechanic 2nd Year Trainee Mechanic 1st Year Trainee Maintenance Trainee Training program guidelines to become a general mechanic shall be those as described in 4D 2(a) identified in the document, Training Program "General Mechanic" established August 31, 1994, and updated August 15, 1999.


The current operating practice is to assign employees to one of the following areas:


Maintenance Area

Ammonia Area

Nitric Acid/Utilities

Nitrate

Urea

ARTICLE 5

SENIORITY


The purpose of this Article is to define and describe the seniority provisions which will govern the seniority status of employees within the bargaining unit.


A . Employees who were hired by Cherokee Nitrogen Company on November 1, 2000 shall have their plant seniority date based on date of original employment at the plant. Such seniority may be used for vacation eligibility and seniority rights.

B. The only type of seniority, which will be considered under this Agreement, is plant seniority.

C. A new employee screened and hired to become a regular full-time employee shall not acquire seniority rights until he/she has been employed by the Company for a period of sixty-five (65) continuous active work days within a period of six (6) months. Until such time as an employee has acquired seniority rights, he/she shall be considered a probationary employee and may be laid off or terminated without recourse, and the Company shall be under no obligation to rehire him/her. When employees have identical plant seniority, the order of seniority placement shall be determined alphabetically.

D. The seniority of an employee shall be considered broken, all rights forfeited, and there shall be no obligation to rehire him/her for any one of the following reasons:

1. If the employee voluntarily quits.

2. If the employee is discharged for just cause.

3. If the employee is away from work for a period of 24 months or length of previously accrued service, whichever is less, for any reason other than illness or injury. In those cases the period of time will be a maximum of three (3) years or length of previously accrued service, whichever is less.

4. Subject to paragraph 3 above, if an employee who has been laid off does not return to work within (10) ten calendar days after the postmark date of a registered or certified letter form the Company, addressed to his / her last known address as shown on the Company's records. It is the employee's obligation to keep the Company informed of his / her correct current address.

Employees who are unable to report within this ten (10) calendar day period because of sickness or accident will, subject to paragraph 3 above and in that event be recalled to any vacancy during any subsequent recall action.

E. If a member of the bargaining unit is promoted to a supervisory or salaried position from an hourly-paid job, he/she shall lose all of his/her seniority in the bargaining unit.


F. A complete seniority list of all active employees shall be posted in each department on the bulletin board within thirty (30) days after signing of this Agreement, and revised quarterly.

ARTICLE 6

POSTING AND FILLING JOB BIDS

Permanent vacancies will be filled on the basis of plant-wide seniority. Such vacancies will be posted on the bulletin board for six (6) calendar days for plant-wide bid. The posting shall indicate the primary assignment and shift. The senior bidder will be awarded the job. The Company will no longer canvass bidders to determine acceptance. In considering bids, management will take into consideration seniority, qualifications, skill, and ability of the employee bidding. When all of the factors, which constitute ability, are relatively equal, then plant seniority shall determine the filling of the vacancy.


An employee who is being laid off from his/her job at the time that a posting is in effect can bump to the job which is posted without bidding in accordance with Article 7, and he/she can keep the job if he/she is senior to the bidder and he/she qualifies. An employee called in from layoff to fill a job while it is posted for bidding must go to the open job when the bidding is completed unless he/she bid for the job and is the senior bidder. If there are no bidders for the job he/she will remain in the job. When employees are being recalled from a layoff, which was caused by a unit production cutback (or shutdown), all employees who have adequate seniority to be recalled are eligible to bid for job openings.

If an employee took a voluntary layoff at the time of the shutdown, but he/she has enough seniority to be on the recall list, he/she will have bid rights just as others in the seniority group being recalled, provided that the job for which he/she holds recall right is open. However, filling of a job in either of the above manners will be regulated by the following:

A. No employee will be granted a trial period if he/she does not have a reasonable expectancy of demonstrating the qualifications required by the job. If within the preceding six (6) months an employee has refused training on the job, or he/she has been disqualified on this job, he/she shall not be permitted to bid.

B. The successful bidder shall be given up to 240 hours of training. If an employee has been previously qualified in the job, he/she will be provided 84 hours of refresher training. In determining whether an employee has become qualified, the results of written and/or practical tests (which meet Federal guidelines) will be among the factors given consideration. If an employee is already qualified or becomes qualified in less than fifteen (15) work days, he/she will be so informed by management.

C. During the period of posting, the Company will fill the job on a temporary basis, not to exceed 35 working days, unless prevented from doing so by extenuating circumstances.

D. When a temporary job is posted in operations, the employee who gets the job will share overtime in that area. When the permanent employee returns, all temporary employees will return to their regular (last permanent classification) jobs.

When a temporary job is posted and the regular employee does not return to the job, the temporary

employee shall become permanent in that classification.


E. When a permanent vacancy exists in the maintenance department, it shall be filled by plant seniority based on journeyman skills required.


ARTICLE 7

REDUCTION IN FORCE AND RECALL


A. Should it become necessary to lay off employees, the Company shall advise the Union of such layoff at least twenty-four (24) hours in advance. It is understood that this provision shall not apply if the layoff is caused by emergencies or by conditions beyond the Company's control.

B. It is understood the Company shall have the right to retain sufficient numbers of qualified personnel and in such event may assign personnel to particular shifts where required, temporarily, for training.

C. Reductions-in-force and recalls shall be on the basis of plant seniority as outlined below:

1. If a layoff is for twenty-one (21) days or less, the employee can take a voluntary layoff with recall rights or bump to any job for which he/she is qualified; however, if no junior employee is available to bump, the employee cannot take a voluntary layoff.

2. Employees who took a voluntary layoff for recall or were laid off, and the reduction in force exceeds twenty-one (21) days, the employee shall be recalled and exercise his/her bump rights as outlined in paragraph (7) below.

3. Employees who choose to take a layoff rather than bump to another job can only be recalled to the job the employee was working at the time of the layoff. The different classifications in production constitute usual jobs as referred to in Article 7, Section C.5. Shift assignments are not recognized in considering usual job. In maintenance, the classifications, as listed in Appendix "A" Maintenance, are the basis for determining usual job, with no consideration given to area of assignment.

4. When the number of shifts in a particular job are being reduced, the junior employee(s) will be given a bump notice and the remaining senior employee(s) will select shift preference based on seniority.

5. The employee's "usual job" is the only job for which the employee can be recalled and only a job different from the employee's present "usual job," by the same definition as is used for recall, can be used as a basis for refusing to bump. For example, a control operator on "A" shift could not refuse to bump a control operator on "C" shift. The same operator could not refuse recall to any control operator job, regardless of shift.

6. An employee who has taken a voluntary layoff shall have the option to be recalled, to an entry level vacancy, if the employee's usual job has not reopened within a period of six (6) months from the date the layoff began. The employee must be qualified for the work and pass a physical examination to be eligible to return. If the employee's usual job has not reopened for a period of twelve (12) months from the date that employee was placed on layoff, the employee shall have option to bump the lowest seniority employee who is in a job for which the employee on layoff was previously qualified, and assume that employee's job. To be eligible to bump to this job, the employee must pass a physical examination. If the employee elects not to return after twelve (12) months, the seniority of this employee shall be considered broken, all rights forfeited and there shall be no obligation to rehire the employee, consistent with Article 5 of this agreement.

7 . If a layoff is for twenty-one (21) days or more, the employee can either take a voluntary layoff with recall rights in accordance with (1) above, or bump to a job for which he/she is qualified or he/she may bump a junior employee and receive a twenty (20) -work-day qualification period or 84 hours if previously qualified in the job. To receive the twenty (20)-day qualification period the employee must demonstrate within the first three (3) work days the ability to learn this job within the twenty (20)-day qualification period. The employee will only be expected to qualify on the job that he/she bumps to in the twenty (20) work day qualification period. Such training will be provided on the day shift when practical. If the employee does not demonstrate the ability within three (3) work days or fails to qualify within twenty (20) days, he/she shall be disqualified and laid off and the incumbent employee shall remain in the job.

8. During the qualification period, the bumping employee shall receive the rate for the last job on which the employee was qualified.

9. It is understood that in Maintenance, if the bumping employee is a Maintenance Level 4, the bumping employee must have the journeyman skills of the employee he/she bumped after the qualification period.

10. In accordance with paragraph (7), in a given layoff, if a senior employee is laid off without an opportunity to bump and a junior employee is left in the plant at the end of the bump/qualification period, the senior employee will be recalled with bump rights.


ARTICLE 8

SCHEDULE CHANGE

The Company shall give an employee thirty-six (36) hours notice of change in the regular work schedule (this notice shall be posted by 2:00 p.m. on the first day of the thirty-six (36) hours notice), and sixteen (16) hours' notice of return to the employee's regular work schedule, except where rescheduling is required due to lack of raw materials, labor difficulty, acts of God, or any other occurrence beyond the Company's control. If the Company fails to give such notice, except where excused in the preceding sentence, the Company shall pay one and one- half (1-1/2) times the affected employee's regular straight-time rate for hours worked on the first day after such change in schedule. If there are any changes in present work schedules for non-shift workers, assignments will be made on the basis of seniority, where practical. The foregoing in no way precludes the Company from making changes in the work schedules according to operational and maintenance needs.

ARTICLE 9

HOURS OF WORK


A. The established workweek begins at 6:00 a.m. on Monday and ends at 6:00 a.m on the following Monday. For the purpose of computing overtime, the normal workweek shall be forty (40) hours and the normal workday shall be eight (8) hours. This is not to be considered a guarantee of eight (8) hours a day or forty (40) hours a week.

B. Under the present operating requirements, the normal schedule for eight (8) hour shift workers shall be organized into three (3) consecutive eight (8) hour shifts as follows:

First shift 6:00 a.m. to 2:00 p.m.

Second shift 2:00 p.m. to 10:00 p.m.

Third shift 10:00 p.m. to 6:00 a.m.

Under the present operating requirements the normal schedule for maintenance workers shall be:

7:00 a.m. to 11:00 a.m.

11:30 a.m. to 3:30 p.m.

When an employee is instructed or scheduled to report for work and so reports and reports on time, the employee shall be guaranteed four (4) hours of work if he/she is put to work, and if no work is available for them to perform, the employee shall receive pay for four (4) hours' work at their regular hourly rate of pay, except in case of fire, flood, power breakdown, or other conditions beyond the control of Management. At the Company's discretion, an employee instructed or scheduled to report for work may be assigned to any work available which the employee is capable of performing in lieu of their being released if there is no work for them to do in their usual occupation.

ARTICLE 10

OVERTIME


A. The basic work day shall be eight (8) hours. The basic work week shall be forty (40) hours. Overtime shall be paid at the rate of one and one-half (1-1/2) times the regular rate of pay for all hours worked in excess of forty (40) hours per week, or in excess of eight (8) hours in a twenty-four (24)-hour period beginning at the start of the employee's regular scheduled shift, except that this provision shall not apply in the case of a regularly scheduled shift change. Overtime payment shall be made on the basis of either daily or weekly overtime, whichever results in the greater pay, but there shall be no pyramiding or duplication of daily and weekly overtime.

B Any employee who is called out to perform work outside their scheduled working hours shall be paid for all time worked pursuant to such call-out, at one and one-half (1-1/2) times his regular rate of pay and will be guaranteed a minimum of four (4) hours' work. An employee on call-out shall not be required to do work other than the job or jobs they were called out to perform unless there is additional emergency work that occurs. The employee will be paid time and one- half (1-1/2) for the actual hours worked on this additional work. To be eligible for call-out, an employee must have a telephone in their residence and notify their foreman of any changes in their telephone number. The Company has no obligation to call an employee at any telephone number other than their residence telephone for call-outs, changing of working schedule, or for any other reason.

C. When an employee moves from one overtime group to another, the number of their overtime hours will be adjusted up or down to equal the average of the new group. Previously qualified employees will also retain eligibility for overtime in previously qualified groups for one (1) year. Employee will receive the higher rate of pay of the two jobs when filling the overtime in another area.

D. Premium pay provided for herein shall not be pyramided on premium pay payable under any other article or section of this Agreement .

E. All overtime hours refused will be charged or added to an individual's overtime hours on the basis of twice (2) the number of hours actually paid to the employee who accepted the work. If charged overtime on a double-time shift is worked, only the overtime paid will be charged.

F. It is considered inappropriate in the scheduling of employees to hold over more than eight (8) hours after any regular eight- hour shift, or to plan work where employees must be scheduled more than twelve (12) hours per day, or holdover more than 4 hours on a 12 hour shift. Every effort should be made to anticipate relief requirements of employees in advance of the time required.

G . If an employee believes he or she has been bypassed for overtime, at the employee's or union's request, the employee or union and his or her supervisor will examine the overtime records and if they agree that a bypass occurred, preference for overtime will be given to the employee, as soon as it is practical.

H. All temporary vacancies will be offered to the qualified operator lowest in overtime hours in that area. It is the Work Group's responsibility to fill the vacancies. Employees who are on duty who refuse to accept holdover overtime assignments to vacancies shall be subject to disciplinary action. Such assignments shall be deemed as mandatory. The Company shall have the right to implement a pager policy or a disciplinary policy to assure that it will have the services of its qualified employees to perform the necessary work.

I. All overtime will be reduced to zero at the end of each calendar year period.

J. OVERTIME COVERAGE PROCEDURE. Overtime hours shall be shared equally by all employees in the Work Group, as far as practical for the efficient operation of the plant, or on the following basis:

1. Maintenance

a. All Maintenance overtime shall be posted by area and Work Group. This time, hours paid for straight-time basis, and two (2) times hours paid but turned down, will be posted by the Company. It shall be the responsibility of the Company to keep this time accurate daily. Overtime will be grouped by area Work Group.

b. Holdovers. The Work Group will offer (holdover) overtime to employees who are already working on the job according to the following procedure:

The personnel already working on the job will be offered the work first, regardless of their normal overtime group.

In the event the assignment involves work in process, and continuity of the work is required, Company may assign the employees already working the job. If a group consists of both central and resident personnel, the resident personnel on the job will be offered the work first. If additional personnel are needed, the work will be offer
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