Document Ev0KOZZaXMLrRQmzZKdLvOgaR
P. O. BOX 792
ARTHUR BROTHERS
INCORPORATED
HIWAY 77 BYPASS KINGSVILLE. TEXAS 78363
TELEPHONE 502-6*16
PLAINTIFF'S EXHIBIT CEL-1394
HOECHST-CELANESE CORPORATION ENGINEERING PLASTICS DIVISION P. 0. Box 428 Bishop, Texas 78343
ATTNs Nr. Merrick Saucier
RE: 1989 Maintenance and Construction Services Agreement
Dear Merrick:
Arthur Brothers, Inc. recognizes the necessity of staffing our
projects at the Bishop Facility as our top priority to you, our customer.
Our meeting with Noechst-Celanese management on August 8, 1989 has been of
vital importance in determining staffing requirements and needs for
*projects over the coming months. Arthur Brothers, Inc. is indeed in a very
precarious position in regards to your needs, area personnel needs, and
those of balancing needs of our workforce. Ne can achieve project schedules
through the end of the year, as we know them, with very few additions to
our currant levels of personnel. It should be noted that we are
experiencing difficulties in obtaining qualified combination heli-arc
welders -at this time to
romplish our schedules on a forty hour week.
Staffing will become increasingly more difficult at present levels of pay
as projects in the area begin to kick off and/or expand present levels.
Current expectations in the general area include two projects which, by
themselves, will saturate local and outside personnel demands. The
Dupont-Occidental Petroleum (OxyChem) Project in Ingleside will peak
between 2500 and 3500 craftsmen during the first and second quarter of
1990* Becon Construction is paying 4 13.50/hr. for heli-arc combination
welders. Carpenters are being paid 4 12.00/hr. with other crafts paying
between these two rates. The Formosa Plastics Project, located near Point
Comfort, Texas, will peak between 6000 and 8000 people in the third and
fourth quarter of 1990. This is a multi--contractor project and prevailing
wage rates at the top level are in the 4 13.50/hr. range at this time.
Brown 8 Root, at the Phillips Plant in Old Ocean, is paying top scale of
413.50/hr. The Mundy Companies at the HCC Plant in Bay City are paying a
top scale of 4 13.50/hr. Locally, Fish Construction is currently paying
heli-arc combination welders 412.75/hr., carbon steel welders 412.34/hr.,
pipefitters and electricians 412.30/hr. and carpenters 412.00/hr. at the
Javelina Project in Corpus Christi, Texas.
Higher pay rates alone will not guarantee that we will be able to
attract additional people to our organization, as proposed projects
indicate will be needed beginning the second quarter of 1990. Higher pay
rates will help in maintaining our current levels and expanding somewhat on
an immediate basis, as the area is only in the beginning stages of
personnel expansion. Of key concern to our organization is the predicted
30X cutback of construction personnel at our facility beginning in January .
16583
Page' 2
August 18, 1989
and continuing through thm first quarter. This must ba prevented through
bmttmr distribution of projects in the coming year, mith more projects
planned for start in the first quarter to negate the cutback in personnel.
If me lose people, even mith a modest increase in pay at this time, they
nill go to other projects in the area paying more. Attracting them back
mill then simply be a matter of paying the highest Mag*. He do not care to
get into a bidding Mar mith other contractors, as this Mould be disastrous
to. all. Hages must be controlled and increased and/or decreased in small
incremental steps, as opposed to large steps as has occurred in the past.
tToo much is lost by either customer or employee Mhen this occurs. The
contractor also suffers in the area of credibility because of his middle
position -- trying to balance the needs of his customer from a cost and
productivity standpoint and that of his employees from a "fairness to all
people~
and valuable resource vienpoint. He at Arthur Brothers, Inc.
believe that to have the most productive norkplace, the process needs side
and the employee's needs sides must be balanced. Hin-Min situations must be
preserved at all times.
He are, therefore, proposing a modest increase in Mage rates at this
time as
per attached SCHEDULE A, effective September 11, 1989. He propose
to move
our current levels ' of heli-arc combination Melders into the
category of technician, Mith a pay scale of $ 12.25/hr. The technician rate
allOMS us flexibility to move this classification Nithout a general
contract approval (local approval only). This rate represents an increase
in our
top rate of 6.52Z over current levels. Other rates have been
increased from 2.08Z at the loMest level (SC Classification) on a
progressive basis to a high of 4.35Z (HA Classification). The rate increase
represents an overall composite 4.45Z increase based on our current
staffing levels and a 40 hour mork Meek. He have also increased the Iom and
high ends of our salaried scales reflecting a 10% increase in allomable pay
ranges.
Please acknoMledge your acceptance of this proposal in the space
provided belotn, keeping the original for your files and returning a signed
copy to us.
Thank you for your consideration in this matter.
Very Truly Yours, ARTHUR BROTHERS, IHC.
Patrick D. Ley Vice-President
ccx H. Hilmeth D. Siemonsma
AcknoMledgement x Byt
Tit let Dates
16590
SCHEDULE "A
Effective date - September 11, 1989
Page 1 of 3
n f teat long. Eax. fiaias. and Eax Practical.
A. Salaries
Range
Superintendent General Foreman Foreman
44,000/59,400 34,650/49,500
28,600/40,150
B. Standard Hourly Rates
1. General
Administrative Assistant Technician
9.00 - 11.00 12.00 - 20.00
Mechanic A Mechanic B Mechanic C Mechanic D
12.00 11.36 10.72 10.29
Utility A Utility B Utility C
9.80 9.40 8.99
Helper A Helper B Helper C
8.59 8.19 7.79
Utility Service A Utility Service B Utility Service C
7.29 6.80 6.49
Service A Service B Service C
6.09 5.80 5.40
Clerical Field Buyer Leadman Temporary Foreman
3.50 - 9.50
9.00 - 11.50 .50 above craft supervised 1.00 above craft supervised
-1-
16591
Page 2 of 3
SCHEDULE "A"
Effective Date - September 11, 1989
2. Warehouse
Rotating Shift
Utility Service A Utility Service B Utility Service C
7.63 7.14
6.83
Service A Service B Service C
6.43 6.14
5.74
St. Day.
7.29 6.80 6.49
6.09 5.80 5.40
3. Engineering
Engineer Draftsman Estimator Planner/Scheduler
12.00 - 30.00
6.00 - 20.00 6.00 - 20.00 6.00 - 20.00
Si.,. Evening
7.63 7.14 6.83
6.43 6.14 5.74
C. Premium Hourly Rates
Premium Hourly Rates shall be paid at the .rate of one and one-half (1-1/2) the employees Standard Hourly Rates. Premium time shall be defined as all houre worked in excess of eight hours (8) in a work day or in excess of forty hours (40) hours in a work week.
D. Pav Practices
(1) Holiday, Sick Leave, Vacation and Jury Duty.
The following shall be recognized hereunder
contractor's Holidays.
July 4
Thanksgiving
Labor DAy
Christmas
a
(a) Hourly Employees - Company shall pay Contractor for any such holiday at 1-1/2 times the standard time pay rates however, Contractor 6hall not be paid for hours not worked, such as any illness, vacation or jury duty, for any of Contractor"s hourly employees except with the written approval of the Company representative.
-2-
16592
Page 3 of 3
SCHEDULE "A"
September 11, 1989
(b) Salaried Employees - Company shall pay Contractor for all salaried employees at a weekly rate of 1/52 their annual salary except for 6ick leave which extends beyond three (3) days, all vacations and the four recognized Contractor holidays.
(2) Call Qni. Eay
Company shall pay contractor for work on a "call out" basis at Company'6 request, outside the Contractor's employees regular scheduled shift at 1-1/2 times standard rate for hours actually worked; however, if work extends into regular hours, then call out pay applies only to hours worked outside the regular scheduled shift. If Contractor"s employee called out works less the four (4) hours and hours worked do not extend into the regular shift, Contractor will be reimbursed for four (4) hours at the standard rate or for hours actually worked at 1-1/2 times the standard rate, whichever is greater.
(3) Sho.H Us Pay
Company shall pay Contractor two (2) hours "show up" pay, at the standard rate, for any contractor employee who reports for his regular scheduled shift but is prohibited from working for any cause beyond Contractor's control.
-316593
ABI SALARIES HISTORY
NAME/POSITION J. J. STARKS/SUPT V. GARCIA/GEN.FMN
E. D. GRIFFITH/GEN.FMN
K. J. HAJEK/GEN.FMN F. SHAFER/FMN R. PENA/FMN A. BRYANT/FMN J. GONZALEZ/FMN R. WILSON/FMN E. CASTOR/FMN J. GONZALEZ/FMN M. SANCHEZ/FMN R. BROWN/FMN S. SAENZ/FMN P. LONEY/FMN A. BALDERAS/FMN J. REYES/FMN S. MORALES/FMN E. GUTIERREZ/FMN
% OF RANGE
1986
1987
1988
83.7%
97.7%
96.9%
NA NA 36.3%
46.2%
62.7%
53.6%
46.2%
62.7%
57.5%
60.8%
60.8%
61.9%
60.8%
60.8%
57.0%
60.8%
60.8%
54.5%
60.8%
60.8%
57.0%
60.8%
71.5%
69.3%
60.8%
71.5%
74.3%
60.8%
60.8%
54.5%
39.5%
55.5%
49.5%
31.5%
31.5%
17.3%
31.5%
31.5%
29.7%
31.5%
31.5%
17.3%
31.5%
31.5% 27.2%
7.5 %
7.5%
-5.0%
7.5%
7.5%
5.0%
7.5%
7.5%
9.9%
P. O. BOX 792
ARTHUR BROTHERS
INCORPORATED
HIWAY 77 BYPASS KINGSVILLE, TEXAS 78363
jUs&fa--' TELEPHONE 502-Mie
HOECHST-CELANESE CORPORATION ENGINEERING PLASTICS DIVISION P.0. Box 428 Bishop, Texas 78343
September 5, 1989
ATTN: Hr. Herrick Saucier
REs 1989 Haintenance and Construction Services Agreement dated 5/1/89 s Arthur Brothers, Inc. Proposal dated 8/15/89
Dear Herrick:
Please -find herewith enclosed, as per attached EXHIBIT "A", our current proposal -for Mage rate increases for your Bishop facility. P-lease note that Arthur Brothers, Inc. has added a new class description of MHechanic SA~ to our previous class descriptions. The class description Mill cover 1 specialized crafts, i.e. heliarc combination nelders, or such crafts Mhich,
due to general area conditions and morkload, are in short supply.
The Mage increase reflects a 6.52Z increase over current levels in our top
craft description. Other rates have been increased from 2.08Z at the loMest
level
(SC Classification) on
a progressive basis to 4.35Z (HA
Classification). The rate increase proposal, if accepted, represents an
overall 4.41Z increase based on our current staffing levels and a 40 hour
Mork Meek. See attached PAY RATE ANALYSIS, dated September 5, 1989.
Arthur Brothers, Inc. has also increased the high end of our salaried scale for our ~Superintendent* classification by a factor of 10Z.
Please beloM, us.
acknoMledge your acceptance of this proposal in the space provided keeping the original for your files and returning a signed copy to
Thank you for your consideration in this matter.
Very Truly Yours,
16535
Bishop EXHIBIT "A"
Effective date - September 18, 1989
Page 1 of 3
fti>iHifieationB and Eax Rates
A. Salaries
Superintendent General Foreman Foreman
Rangff
40,000/60,000 31,500/45,000 26,000/36,500
B. Hourly Bates
1. General
Administrative Assistant Technician
9.00 - 11.00 12.00 - 20.00
Mechanic SA Mechanic A Mechanic B Mechanic C Mechanic D
12.25 12.00 11.36 10.72 10.29
Utility A Utility B Utility C
9.80 9.40 8.99
Helper A Helper B Helper C
8.59 8.19 7.79
Utility Service A Utility Service B Utility Service C
7.29 6.80 6.49
Service A Service B Service C
6.09 5.80 5.40
Clerical Field Buyer Leadnan Temporary Foreman
3.50 - 9.50 9.00 - 11.50 .50 above craft supervised 1.00 above craft supervised
-1-
165S6
Page 2 of 3
Bishop EXHIBIT ~A"
Effective Date - September 18, 1989
2. Warehouse
Hotating Shift
Utility Service A Utility Service B Utility Service C
7.63 7.14 6.83
Service A Service B Service C
6.43 6.14
5.74
St-- Dax.
7.29 6.80 6.49
6.09 5.80 5.40
3. Engineering
Engineer Draftsman Estimator Planner/Scheduler
12.00 - 30.00 6.00 - 20.00 6.00 - 20.00 6.00 - 20.00
St., Evening
7.63 7.14 6.83
6.43 6.14 5.74
C. Premium Hourly. Sates
Premium Hourly Bates shall be paid at the rate of One and one-half (1-1/2) the employees Standard Hourly Bates. Premium time shall be defined as all hours worked in excess of eight hours (8) in a work day or in excess of forty hours (40) hours in
a work week.
D. Ear Practices.
(1) Holiday, Sick Leave, Vacation and Jury Duty.
The following shall be recognized hereunder
contractor-s Holidays.
July 4
Thanksgiving
Labor DAy
Christmas
a
(a) Hourly Employees - Company shall pay Contractor for any such holiday at 1-1/2 times the standard time pay rates however. Contractor shall not be paid for hours not worked, such as any illness, vacation or jury duty, for any of Contractor"a hourly employees except with the written approval of the Company representative.
-2-
16597
Page 3 of 3
Bishop EXHIBIT "A"
Effective September 18, 1989
(b) Salaried Employees - Company shall pay Contractor
for all salaried employees at a weekly rate of 1/52 -their annual salary except for sick leave which extends beyond three (3) days, all vacations and the four recognized Contractor holidays.
(2) Call Qul Eax.
Company shall pay contractor for work on a "call our" basis at Company's request, outside the Contractor's employees regular scheduled shift at 1-1/2 times standard rate for hours actually worked; however, if work extends into regular hours, then call out pay applies only to hours worked outside the regular scheduled shift. If Contractor"s employee called out works less the four (4) hours and hours worked do not extend into the regular shift, Contractor will be reimbursed for four (4) hours at the standard rate or for fours actually worked at 1-1/2 times the standard rate, whichever is greater.
(3) Shaa On Pay
Company shall pay Contractor tow (2) hours "show up" pay, at the standard rate, for any contractor employee who reports for his regular scheduled shift but .is prohibited from working for any cause beyond Contractor's control.
-316598
Claes Descriptions and Qualifications
Mechanic SA,^
Skilled, experienced, capable and responsible to perforin all phases of one or more crafts. This craft designation shall be used as top rate to attract those specialized crafts, i.e. Heliarc combination welders, or such crafts which, due to general area conditions and workload, are in short supply.
Mechanic A^
Skilled, experienced, capable and responsible to perform all phases of one or more of the fallowing crafts: Instrument Mechanic, Electrician, Machinist, Pipe Welder (carbon & alloys). Pipefitter, Rigger, Boilermaker, Equipment Operator (heavy), Diesel engine mechanics,Insulators, Painter, Carpenter and Iron Workers
Mechanic B--
Gradient of Mechanic A. Skilled, experienced, capable and responsible to perform all phases of one or more of the following crafts: Carpenter (rough). Painter (brush), Pipe Welder (carbon), Iron Worker/Welder (Structural), Iron Worker (rebar).
Mechanic L_
Gradient of Mechanic A & B. Skilled, capable, and responsible to perform as craftsman with moderate experience.
Mechanic U
Gradient of Mechanic A,B & C. Capable and responsible to perform as craftsman with minimal experience.
Utility A
Positions demanding considerable skill and responsibility i.e.. Tool room attendant, Water blaster, Warehouse receiving clerk. Equipment operator (light), Dispatcher, Gauger, Etc.
Utility, S
Gradient of Utility Man A.
Utility. 2. Gradient of Utility A & B
Page 1
16599
ARTHUR BROTHERS, INC. HAGE RATE ANALYSIS
HOESCHT-CELANESE CORPORATION - Bishop Facility Saptaabar S, 1999
CURRENT LEVELS
PfiO.ZQSJ. LVAS
Classification Currant Currant
Currant Proposad Proposad Proposad
Numbar Hrly. Pay Tot. Pay Numbar
Hrly. Pay Tot. Pay
Hourly Foraaan Asst. Foraaan SA--Laadaan
SA HA-La adman
HA HB--Laadaan MB HC HD *UA-Laadaan UA UB UC HA HB--Laadaan HB HC-Laadman
HC USA-Laadaan USA USB
use
SA SB SC
4 2 0
O
6 87
1 29 " 14
8 1 3 2 6 14 5 15 2 15 16 23 11 24 4 18 38
12.50 8.59 .00 .00
12.00 11.50 11.40 10.90 10.30
9.90 9.95 9.45 9.07 8.69 8.32 8.44 7.94 8.06 7.56 7.59 7.09 6.62 6.33 5.95 5.67 5.29
50.00 17.18
,oo.
.00 72.00 1000.50 11.40 316.10 144.20 79.20
9.95 28.35 18.14 52.14 116.48 42.20 119.10 16.12 113.40 121.44 ~ 163.07 72.82 151.92 23.80 102.06 201.02
4 2 6 21 0 66 1 29 14 8 1 3 2 6 14 5 15 2 15 16 23 11 24 4 18 38
13.25 8.79
12.75 12.25 12.50 12.00 11.86 11.36 10.72 10.29 10.30
9.80 9.40 8.99 8.59 8.69 8.19 8.29 7.79 7.79 7.29 6.80 6.49 6.09 5.80 5.40
53.00 35.16 76.50 257.25
0.00 792.00
11.86 329.44 150.08
82.32 10.30 29.40 18.80 53.94 120.26 43.45 122.85 16.58 116.85 124.64 167.67 74.80 155.76 24.36 104.40 205.20
TOTALS
348
3042.59 348
3176.87
CURRENT AVERAGE HOURLY PAY
* 3042.59/348
m $ 8.74307 par hour
PROPOSED AVERAGE HOURLY PAY
3176.87/348
*m 9.12893 par hour
PER CENT INCREASE
3176. 87/3042.59 X 100
4.41334 Z
166(31
BID SUMMARY
Straight Time Waees
Mundv FD
ABI
Payroll insurance, taxes, benefits
22.68%(a) 19.61%(a)(b) 26.7%(c)
Offsites, indirects, 10.0% profit and overhead
Benefit wage cost
3.53%
11.9% 3.02%
8% (< $8MM) 7% (< $12MM) 6% (jg $12MM)
> Included Above
Workers Compensation Included
- Above
Fee to supervise
0.0%
other contractors
8.02% 2.5%
Included Above 0.0%
Total straight time fee 36.21%
45.05%
34.7%
33.7%
32.7%
Premium Time Wages
Payroll Taxes Fee Total
8.13% 0.00% 8.13%
11.01% 0.00% 11.01%
7.5% 1.0% 8.5%
a) Not including benefit wage cost b) Not including workers compensation insurance. c) Includes ~ 4.3% SUI and ~ 6.4% FUI billed quarterly.
1S8Q2
PROCESS Evaluation of Maintenance Contractors by Site Representatives
WHY
* Current contract with ABI expires April 30, 1989
* Potential Regional and National contract cost benefits
Concern about Arthur Brothers
3
financial stability
/9&s~ V
client base -
organizational growth
employee development
GOAL * Select the lowest "total cost" contractor
166(113
EVALUATION DEVELOPMENT PROCESS
Organized evaluation team " ^ ' A,f\)
Identified potential contractors - 7
Appraisal visit with each contractor
Contractors rated "
^ FP
Identified contractor bid list - 3 ^ \ /v p. ^ ' >
Evaluated contract bids
Selected contractor of choice
Reviewed and revised contract
"**<}'
^
16604
RECOMMENDATION Contractor of Choice: Mundy Company
REASONS
ABI bid - profit questionable
Skill mix management--
t~t!es*o 'Tr^-yC.
\ 'ifis&z
- Productivity /
jj
Current client base Organiz^fonal growth
*4-0% tf&*~
Employee development
166Q5
TRANSITION PLAN
Action Item
Date
* Bishop decision ,
4/5/89
* Bishop Facility Management decision communication
- EPD management - Facility Managers Texas sites - T.R. Shandley
4/5/89 to
4/9/89
- Arron Starks
4/10/89
* T.R. Shandley notify Mundy
.
* Texas sites contractor(s) decision announcements
4/10/89
- Arron Starks to ABI - HR to Hoechst Celanese - Mundy representative on-site
4/11/89 to
' 4/14/89
* Execute Mundy transition plan * Mundy assumes new contract
4/11 thru 4/30/89 5/1/89
16606