Document OEpeOY9b9957R3EZjrKeJnJkv
P. O. BOX 792
ARTHUR BROTHERS
INCORPORATED
HIWAY 77 BYPASS KINGSVILLE. TEXAS 78363
PLAINTIFF'S EXHIBIT
CEL-1401
aHONE 592-6416
April 24. 1989
AFS-28-89
Hoechst Celanese Corporation Engineering Plastics Division P. 0. Box 428 Highway 77 South Bishop, Texas 78343
Attn: Mr. Merrick E. Suacier
Re: 1989 Contract
Dear Merrick:
Arthur Brothers. Incorporated (ABI), appreciates the opportunity to renew our contract with the Hoechst Celanese Bishop Facility.
We submit the attached schedules to be attached to and made a part of the referenced contract as follows;
Schedule A. Schedule B. Schedule C.
Schedule Schedule Schedule Schedule Schedule Schedule
D. E. F. G. H. I.
Classifications, Pay Rates and Pay Practices Rental Rates, Small Tools, and Personal Protection Equipment Costs Percentage Fee (Markup) for Maintenance. Construction, and Engineering Labor Costs. Employee Moves and Traveling Expenses Safety Awareness Activities Supervisory Training Insurance to be carried by Contractor Substance Abuse Program Continued Improvement Plan
Very Truly Yours ARTHUR BROTHERS, INC.
CC: D. Siemonsma H. Wilmeth
Aaron F. Starks Vice-president
16748
SCHEDULE "A"
Effective date - May 1, 1989
Page 1 of 3
Classifications, Fay, Rates and Pay Practices
A. Salaries.
Range
Superintendent General Foreman Foreman
40,000/54,000 31,500/45,000 26,000/36,500
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
11.50 10.90 10.30
9.90
Utility A Utility B Utility C
9.45 9.07, 8.69
Helper A Helper B Helper C
8.32 7.94 7.56
Utility Service A Utility Service B Utility Service C
7.09 6.62 6.33
Service A Service B Service C
5.95 5.67 5.29
Clerical Field Buyer Leadman Temporary Foreman
3.50 - 9.50
9.00 - 11.50 50 above craft supervised 1 00 above craft supervised
-1-
16749
Page 2 of 3 SCHEDULE "A"
Effective Date - May 1, 1989
2. Warehouse.
Rotating Shift
Utility Service A Utility Service B Utility Service C
7.42 6.95 6.66
Service A Service B Service C
6.28 6.00
5.62
S.f.- Day.
7.09 6.62 6.33
5.95 5.67 5.29 .
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
7.42 6.95 6.66
6.28 6.00 5.62
C. PremiumHourly 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 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. Pay. Practises,
(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 6uch 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's hourly employees except with the written approval of the Company representative.
-2-
16750
Page 3 of 3 SCHEDULE "A"
Effective May 1, 1989
(b) Salaried Empleveea - Company Bhall 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 Out Pav
Company shall pay contractor for work on a "call out-" 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 hours actually worked at 1-1/2 times the standard rate, whichever is greater.
- (3) ShflH lip 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.
-316751
Claes Descriptions and Qualifications
Mechanic
Skilled, experienced, capable and responsible to perform all phases of one or more of the following 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 IL_
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 D.
Gradient of Mechanic A,B & C. Capable and responsible to perform as craftsman with minimal experience.
Utility L
Positions demanding considerable skill and responsibility i.e.. Tool room attendant, Water blaster, Warehouse receiving clerk. Equipment operator (light). Dispatcher, Gauger, Etc.
Utility. E
Gradient of Utility Man A.
Utility .
Gradient of. Utility A & B
Helper A,.B, & C.
Assistant to and under direction of Mechanic. Position demands considerable skill and responsibility. Unless otherwise qualified helpers start as Class C and earn promotions through individual merit.
-1-
16752
Class Descriptions and Qualifications Page 2 of 2
utility Service. A
Semi-skilled positions demanding moderate responsibility, i.e.. Warehouse delivery, Truck Driver (light), Tractor mower, Metal salvage, Fuel oil loader, Warehouse packaging, drumming, etc. May also be used as assistant to other classifications.
Utility Service. fi
Gradient of Utility Service A Utility Service G. Gradient of Utility Service A & B
Service A.E &. Q.
Unskilled labor. Unless otherwise qualified Service men start at Class C and earn promotions thru individual merit. May be used as assistant to other classifications..
Engineering
Due to the wide range in education, expertise and experience in these positions, rates are set on an individual basis, with approval of company representative.
Technician.
Special skills not attainable under other classifications. Approval of ABI main office and HCC company representative is required. All positions are filled at the lowest possible classifications consistent with manpower availability.
-2-
16753
Schedule "B" page 1 of 1
Rental Rates, Small Tools and Personal Protection Equipment Cost
1. Rental rates for all tools and equipment owned by Contractor shall not exceed the existing local standard rates or exceed 85% of the latest Associated Equipment Distributor's listing, whichever is lower.
2. If HCC chooses to supply all tools including those of a value of $400 or less, a percentage of .5% shall be deducted from the overhead fee of Submittal "C".
3. If HCC chooses to supply all safety glasses, goggles hard hat6 and'I.D. badges, a percentage fee of .2% shall be deducted from the overhead fee of Submittal "C".
4. It is
supplies including hazardous materials.
understood HCC all personal
will supply all expendable protection equipment for
16154
Schedule *'C Page 1 of 1
Percentage Fee (Markup) for Maintenance, Construction and Engineering Labor Costs.
A. 22% on the straight time portion of actual wages and salaries chargeable to the work which covers all related costs such as FICA, employee benefits, and required insurance.. State and Federal Unemployment taxes are excluded and shall be accrued and billed to Company at co6t at the end of each quarter.
B. Sliding Scale Fee of:
1. 6% on the straight time portion of actual wages and salaries chargeable to the work up to $8,000,000.00 to cover, overhead and other unidentified cost6.
2. 5% on the straight time portion of actual wages and salaries chargeable to the work from 8,000,001.00 to 12,000,000.00 to cover, overhead and other unidentified costs.
3. 4% on the straight time portion of actual wages and
salaries chargeable to the work from 12,000,001.00
and
up,
to cover, overhead and other
unidentified costs.
C. 2% on the straight time portion of actual wages and salaries chargeable to the work to cover profit. This portion of the fee shall not be applicable to any rework as described in Article 6.
D. 7.5% on the premium portion of overtime actual wages and salaries chargeable to the work which covers all payroll related (FICA) costs.
E. 1% on the premium portion of overtime actual wages and salaries chargeable to the work, to cover profit, overhead and other unidentified costs.
16755
Schedule "D" Page 1 of 1
Employee Moves And Traveling Expenses
Key Long Term Employees
(1) Actual moving expenses to job site of Contractor'^ long term employees shall be limited to an allowance of, not to exceed packing and moving, 15,000 lbs of household goods only, at existing local standard rates and not to exceed rates set by the Texas Railroad Commission. Employee shall receive Three (3) days leave of absence at his regular salary for such move.
Key Short Term Employees
(2) Travel expenses of Contractor's key short term employees shall be limited to travel expenses not the exceed actual mileage to and from Contractors Main office to the job site at the rate of 24 cents per mile. Travel time (hourly employees only), shall be limited to one hour at the standard rate of pay for each fifty (50) miles traveled to and from Contractors Main office and the job site.
(3) Per diem of fifty (50.00) dollars shall be allowed for each employee whose work requires they stay overnight away from their principle residence.
(4) All moving, travel and per diem expenses shall have prior approval of the company representative.
(5) Long term-employee shall be defined as one who becomes a part of the ongoing operation, whereas short term shall be those brought in for turn-arounds or other projects of specific duration.
(6) A charge of 24 cents per mile will be charged for all vehicles used by the Contractor in the performance of work on behalf of the owner. Transportation of employees to and from the work site is not a reimbursable cost.
16756
Schedule "E" Page 1 of 1
Safety Awareness Activities
1. Quarterly Safety audits by ABI Safety Director and Insurance Safety Engineer
(A) To insure hazards communication compliance (B) To perform simulated OSHA inspection (C) To insure minimum legal requirements for all
Environmental, Health, and Safety procedures and equipment.
2. Monthly newsletter from' ABI Safety Director containing:
(A) Narratives of accidents and/or near-accidents of the- previous month
(B) Current ABI statistics (C) Current OSHA matters (D) Safety information Articles (C) Comments and Views from the field
3. Semi-annual field Safety Coordinator Training Seminars
(A) OSHA and EPA matters (B) Improving Safety Awareness and Training
4. Monthly Field Safety Meetings
(A) General Safety and Health Information (B) Specific developments in Safety and Health (C) Targeted for Safety and Health Awareness (D) Meeting involvement: All Personnel
5. Weekly Foreman/crew Safety Meeting
(A) Conducted by Foreman with crew (B) Safety meeting outlines provided from Home Office. (C) Material is previewed and discussed with management
supervision and Safety Coordinator.
6. Safety Awards and Incentives
(A) Determined by competition between locations <B) Include plaques and individual prizes ( caps, belt
buckles, windbreaker, coffee mugs, etc.)
16757
Schedule "F Page 1 of 1
Supervisory Training 1. Semi-Annual Seminars 2. Monthly Video Sessions
Subjects: Safety and Health, Human Relations, Productivity, Discipline, Communication Skills, Motivation, Appraisals, and Quality
16758
Schedule "G Page 1 of 3
Insurance To Be Carried By Contractor
January 1, 1989
WORKERS' COMPENSATION:
Policy Period - September 7, 1988 to September 7, 1989
Employers' Liability Limits
Bodily Injury by Accident Bodily Injury by Disease Bodily Injury by Disease
$500,000 each accident
$500,000 each employee $500,000 policy limit
Premium Basis ciassification
Rata P.ex $ 1Q.Q. Payroll
Oil Refining Units Erection or Repair
8.02
Increased Employers" Liability Limits Charge 1%
Experience Modifier .78
GENERAL LIABILITY;
(Per Individual location, i.e. Bishop, Bay City, Pampa and Corpus Christi)
Policy Period - September 7, 1988 to September 7, 1989
Limits of Insurance
General Aggregate Limit Products - Completed Operations Personal and Advertising Injury Each Occurrence Limit Fire Damage Limit Medical Expense Limit
$2,000,000
Aggr. Limit
2,000,000
Limit
1,000,000
1,000,000
50,000(any one fire)
5,000(any one person)
Premium Basis
Classification.
Rais. Per $1000 payroll
Oil Still Erection or Repair
$16.50 *
*net rate after premium discount
16759
Schedule "G" Page 2 of 3
UMBRELLA PRICING FOR PRESENT COVERAGE (9-7-88/9-7-89).
UMBRELLA LIABILITY
Policy Period - September 7, 1988 to September 7, 1989
Limits of Liability
$4,500,000 any one accident or occurrence $4,500,000 aggregate limit Premium Basis
Premium.: Policy Fee Taxes:
$78,000.00 (Flat) 200.00
3.925.64 82,125.64
Each of the above policies shall be written specifically and solely for Hoechst Celanese Corporation and its affiliates and subsidiaries only. Naming Hoechst Celanese Corporation directly as being solely covered by each policy.
All applicable policies shall be subject to the terms and conditions of Article 29 (Indemnity)) of the proposed contract. See attached sample "Certificate of Insurance"
UMBRELLA LIABILITY of $10,000,000
See attached as submitted by Texas Employers Insurance Co.
16760
Schedule "G" Page 3 of 3
REVISION OF UMBRELLA PROGRAM TO MEET $10,000,000 REQUIREMENTS:
OPTION ONE: London has agreed to leave the current umbrella in force; increase the limits to $10,000,000; and endorse the policy to delete the aggregate. Therefore, our umbrella would provide $10,000,000 in unaggrecated limits. The $10,000,000 per occurrence limit would be available for each occurrence, no matter how many occurrences occur in the policy year. There would be $10,000,000 in umbrella limits for each occurrence that happened, whether it be a loss relating to Hoech6t Celanese operations, or a loss from any other operations, the $10,000,000 limit would be available for each.
LIMIT $10,000,000
CARRIER
Lloyds of London
AfflfflAL PREMIUM
$45,000 *
RATE.
Flat
* Annual Premium to be pro-rated for term (to expire 9-7-89).
OPTION TWO: Pull out the ABI (work for HOC) portion of the London umbrella and re-write a separate umbrella for ABI, London would continue to write a $4,500,000 umbrella for all non-HCC operations. The new separate umbrella for ABI (HOC operations) would be written with new carriers as follows: .
LIMIT,
$5,000,000
CARRIER First State
ARMUAL PREMIUM $77,189 *
RATE Flat
$5,000,000 .excess of $5,000,000
Employers Casualty Company
$45,000 *
Flat
* Annual premium to be pro-rated for term (to expire 9-7-89).
16761
CERTIFICATE OF INSURANCE
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND. EXTENO OR ALTER THE COVERAGE AFFORDEO BY THE POLICIES BELOW. SHOULD ANY OF THE POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL MAIL _SIL__0AYS WRITTEN NOTICE TO THE CER TIFICATE HOLDER NAMED:
certificate holdsi
February 24. 1989
issue date of this certificate
September 7, 1988
ISSUED AT
Coraus Christi, Texas
HoechsC Celanese P. ,0. Box 428 Bishop, Texas 78343
fT| TEXAS EMPLOYERS' INSURANCE ASSN. DALLAS, TX
f0l TEXAS EMPLOYERS INDEMNITY CO. DALLAS, TX fT] EMPLOYERS CASUALTY COMPANY DALLAS, TX
fTj EMPLOYERS NATIONAL INSURANCE CO. OALLAS. TX
[71 EMPLOYERS CASUALTY CORPORATION DALLAS. TX
INSURED
ARTHUR BROTHERS, INC. P.O. BCK 792 Kingsville, Texas 78363
[T] EMPLOYERS NATIONAL INS. CORR OALLAS, TX
[T1 EMPLOYERS OF TEX^S-LLQXD'S OALLAS. TX
LDDYDS OF IOJKN vrittm\through
(Typ*dl Den Tea
COVERAGES-
THIS 8 TO CERTIFY THAT POUC1E3 OF INSURANCE LISTED BELOW NAVE SEEN ISSUED TO THE INSURED NAMED ASOVE FOR THE FOUCT PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT. TERM OR CONOmON OF ANY CONTRACT OR OTHER OOCUMENT WITH RCSFECT.TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY FERTAIN. THE INSURANCE AFFORDED BY THE POLICIES OESCttSED HEREIN IS SUBJECT TO ALL THE TERMS. EXCLUSIONS, AND CONOL TIONS OF SUCH POLICIES.
TYPE OF INSURANCE
CO. NO.
WORKERS' COMPENSATOR ANO
EMPLOYERS' LIABILITY
general uabiuty
COMMERCIAL general UABIUTY
ojaovme | lomiMEig
CRNEM l CCNTVCtORS fROTEOM
POLICY NUMBER
POUCT tPPICTIV* POLICY EXPIRATION DATE (MM/OQ/YY1 DATE IMMrtMWWI
ALL LIMITS IN THOUSANDS
STATUTORY
.'.A-;;-,-'
c*o icoonn
`oawsE-RXjer uwn
OBeASSEACH {MPLOTtP
GENCtoL AGGftKUIt
s
PRODUCTS CCMPHRS ACGAEGATE
s
annotai wtnrwK mm*i
s
EACH OCCURRENCE
ME OAUAGE IANT ONE Mfl
AUTOMOBILE UABIUTY ANY AUTO AU. OWNED AUTOS SCHEDULED AUTCS MREO AUTOS NOELMNEO AUTOS GARAGE UA*U!Y
EXCESS UABBJTY
OjMBEEUA liability
OTHER THAN UMBRELLA fQRM OTHER
CD-1009
9-7-88
9-7-89
C& BXT
mumrr mAc*oonm mOII*HmWv
s s s s
" AU'A, S 4,500, raws
"^>7:vwr.';
$ 4,500,
cc: NGA. Waiver of subrogation has been endorsed to above mentioned policies in favor of HoechsC Celanese.
TCCO 17993*A 19-ATI
16763 *
Schedule "H" Page 1 of 1
Substance Abuse Program
1. All new employees must pass test for substance abuse prior to beginning work.
2. Ten (10%) percent of workforce is randomly selected and tested each month for substance abuse.
3. All employees are tested at least once each 12 months.
4. Any employee incurring an OSHA loggable injury shall be tested.
5. All pre-employment testing shall be considered "Cost of Work" and billed to Hoechst-Celanese at Thirty-Five Dollars ($35.00) per test.
6. All random and incident testing shall be considered "Items not Cost of Work" and shall be paid by Contractor.
16764
Schedule "I" Page 1 of 2
Continued Improvement Plan
Contractor agrees to achieve satisfactory improvement progress in the following areas, and to furnish the company with evidence of these improvements.
IMPROVEMENT AREA
EXPECTATION
1. Develop and implement long term
training plans to improve people and
organizational
management
skills.
Measure and report on progress regularly
to include results on the job.
FOREMAN MANAGEMENT
2. Develop and utilize craftsmen input
SKILLS
to job improvement action ideas.
3. Identify candidates for supervisor
backup and replacement and. develop
skills with relevant training, report on
*************************p**ro*g*r*e*s*s**r*e**g*u*l*a*r*ly*.**********************
1. Develop' and implement a plan to
improve cross craft skills. Report on
progress regularly.
2. Improve employee record keeping on
evaluations of performance, skills,
reasons for leaving, recommendation for
CRAFTSMAN SKILLS
rehire, etc., to hire skiilS to match
work assignments.
3.' Identify and obtain required
certifications (e.g. yard runners,
Forklifts, Weed Sprayers, A6besto6
Removal, etc.). Report on progress
**************************re**g*u*l*a*r*ly**. ******************************
1. Significantly increase the current
Helper/Craftsman Ratio of 0.5
2. Improve crew mix management methods
CREW MIX MANAGEMENT
to optimize average wage rate and report
results monthly, (e.g. by functions -
Maintenance, Construction, Warehousing,
Etc. and Total).
3. Develop and implement a plan to
**************************c*o*n*t*r*o*l**p*ro**g*re**s*s*io*n***to***to*p***w*a*g*e**ra**te**. ***
Schedule"I" Page 2 of 2
1. Identify Company strategy for
COMPANY IMPROVEMENT
continual improvement of Safety,
Quality, and Productivity, and implement
a plan for achievement.
**# # # * * * ** * * ** * * * * * # **** * * * ** * * * *# ** * *** * # ** ** * ** ** ** 3ft * * * ** ** *** *
1. The overall impact of progress in the
above needs improvement areas must be a
significantly
improved
maintenance
GENERAL
organization as viewed by Hoechst
Celanese.
2. Lack of. satisfactory progress may
result in cancellation of the contract.
***************:M:************************************************
1. Improvement plans must be written,
ACTION PLANS &
furnished to the Company, and include
SCHEDULES
target progress schedules.
jfs ^ ^/f. ^^ ^^ ^^ ^^ ^ ^^ ^ ^ ^ ^^ ^^^^ ^^^ ^ iy.^ ^ ^ ^ ^ ^^'T^'- ^ ^ ^ * t4^
^^^*T* 4'*> ^ 4<>T^*^^-7- ^-T* ^"T~ *T' ^^^*' * t**T' ^ ^ *T^' 4>^^^^^^
16766
cl - #/?/*
Fee for offsites, indirects, profit & OH
10%
Included in markup for small tools, expendables u/l%
Included in markup for safety hats, glasses, goggles and badges
1/ .1%
11.9 %* -2 2.75%
26.3%
b f~U~
8%-up to $8MM 7%-up to $12MM 6%-up to $12MM
.5%
included above
.2%
Total markup on straight time wages
Markup on salaries Fee to supervise
subcontracts
32.68% Same
31.51% (32.01%)
34.3 (33.3) (32.3)
ZZa** f-v
*-1 - SUI - now 2.7%, will probably increase to 3.2% (increase of .5%) *-2 - Proposed sliding scale for straight time wage cost over $20MM *-3 - Covers holiday, sick leave, vacation and jury duty pay (15.31%),
plus other salaried benefits (18%)
16787