OPEN ECONOMIC UNION PROPOSAL FOR A RENEWAL AGREEMENT BETWEEN LOCAL LODGE 2171 IAMAW AND LOCKHEED MARTIN AEROPARTS, INC. JOHNSTOWN, PENNSYLVANIA

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1 OPEN ECONOMIC UNION PROPOSAL FOR A RENEWAL AGREEMENT JOHNSTOWN, PENNSYLVANIA FIRST SUBMITTED MAY 11, 2018 THE UNION RESERVES THE RIGHT TO ADD TO, SUBTRACT FROM OR MODIFY THESE PROPOSALS AT ANY TIME DURING THESE NEGOTIATIONS. THE UNION ALSO RESERVES THE RIGHT TO MAKE COUNTER PROPOSALS TO ANY COMPANY PROPOSALS. ALL ARTICLES OR SECTIONS NOT MENTIONED IN THIS PROPOSAL SHALL REMAIN UNCHANGED. Note: Proposals in BLUE TEXT are newly proposed language. Proposals in BLACK TEXT are mutually agreed to and/or unchanged language. Proposals in RED STRIKE TEXT are proposed deleted language. 1

2 UNION PROPOSAL #1 ARTICLE 10 HOLIDAYS 10.2 Holidays recognized in this agreement shall be: Monday May 28 Tuesday Jan. 1 Wednesday July 4 Monday April 22 Monday Sept. 3 Monday May 28 Tuesday Nov. 11 Thursday July 4 Tuesday Nov. 22 Monday Sep. 2 Monday Nov. 26 Thursday Nov.28 Monday Dec. 24 Monday Dec. 2 Tuesday Dec. 25 Tuesday Dec. 24 Wednesday Dec. 26 Wednesday Dec. 25 Thursday Dec. 27 Thursday Dec. 26 Monday Dec. 31 Monday Dec. 30 Tuesday Dec Wednesday Jan. 1 Thursday Jan. 2 Monday May 25 Monday July 6 Monday Sept. 7 Thursday Nov. 26 Monday Nov. 30 Thursday Dec. 24 Monday Dec. 28 Tuesday Dec. 29 Wednesday Dec. 30 Thursday Dec. 31 2

3 UNION PROPOSAL #2 ARTICLE 11 FLEX TIME 11.1 Flex time will be accrued according to the schedule below: Years of Service Earned per Month

4 ARTICLE 12 SENIORITY UNION PROPOSAL # LAYOFF SELECTION F. Employees laid off from the company shall be continued under the medical and dental provisions of the Group Medical Plans for the remainder of the month the employee is laid off plus two (2) additional months with the Company paying the full costs of the Group Medical Plans. 4

5 ARTICLE 13 JOB BIDDING UNION PROPOSAL # Lead positions will be posted and awarded to the qualified bidder with the greatest seniority who has previously held or currently holds the classification over which the Lead position will be designated for at least twelve (12) months. The following criteria will be used to determine if an applicant is qualified: ability to communicate, train and work well with fellow workers, supervisors and other departments; and good technical ability in the posted classification. Probationary employees are not eligible to apply for a Lead position. During periods when employees are serving in lead positions, they will be paid an additional seventy-five cents ($.75) one dollar twenty-five cents ($1.25) per hour above the base rate. 5

6 UNION PROPOSAL #5 ARTICLE 18 BEREAVEMENT LEAVE PAY 18.0 Employees are eligible for up to three four days of paid time off for the death of their parent, step-parent, spouse, child, step-child, brother, sister, step-brother, step-sister, parent-in-law, grandparent, grandchildren, Aunt, Uncle, brother/sister-in-law, or son/daughter-in-law, and grandparents-in-law. One day must be the day of the funeral or cremation memorial service. 6

7 UNION PROPOSAL #6 ARTICLE 22 SAFETY HEALTH 22.4 The Company will reimburse up to a maximum of $ $ to each employee for the purpose of obtaining prescription safety glasses which meet ANSI specifications for frames and lenses. Glasses may be purchased from the employee s vendor of choice. This benefit will be provided every two years or more frequently if damage to the frames or lenses is as a result of performing work requirements at the Company. 7

8 UNION PROPOSAL #7 ARTICLE 22 SAFETY HEALTH 22.5 The Company will provide safety foot protection where it is required on the job. Additionally, to encourage their use, the Company will reimburse up to sixty dollars ($60.00) one hundred dollars ($100) every year toward the purchase of OSHA approved steel-toe safety shoes for any employee. 8

9 UNION PROPOSAL #8 ARTICLE 26 SEPARATION PAY NEW ARTICLE 26.1 Separation Pay shall be paid to any employee whose permanent displacement is brought about by one or more of the following: a plant merger, shutdown of the factory, selling of the factory, loss of recall rights because of a lay-off, retirement or technological changes An employee who leaves the Company in accordance with Section 26.1 of this Article shall receive two thousand dollars ($ ) for each year of service and in addition, payment for any unused flex time for which the employee may be eligible. RENUMBER ARTICLE 26 DURATION TO ARTICLE 27 9

10 UNION PROPOSAL #9 APPENDIX A WAGES - SECTION ONE ADD: B) 1. Effective May 20, 2018 and on May 20 of each year of the Agreement, before the application of the action prescribed in Section One, Paragraph (B) 2., each employee shall receive an equity pay adjustment of one dollar fifty cents ($1.50) per hour. 10

11 APPENDIX A UNION PROPOSAL #10 WAGES - SECTION ONE B) 2. Effective on the dates immediately below, the base rate of pay for each employee and the labor grade minimums and maximums shall be increased as provided below: May 20, % May 20, % May 20, % 11

12 APPENDIX A UNION PROPOSAL #11 WAGES - SECTION ONE C) Automatic Rate Progression All employees who are not at the maximum rate of their classification shall receive an additional fifteen cents ($.15) fifty cents ($.50) per hour effective the first Monday of each August, December, and April of each year of this agreement. 12

13 UNION PROPOSAL #12 APPENDIX A WAGES - SECTION TWO CHANGE: Chart to show new dates and rates. Effective May 15, 2017 LABOR GRADE MINIMUM MAXIMUM 1 $11.23 $ $12.04 $ $13.86 $ $16.44 $ $17.26 $ $18.25 $ $18.96 $

14 UNION PROPOSAL #13 APPENDIX A WAGES - SECTION THREE Shift differential shall be $.40/hour $1.00/hour in addition to employee base rate. 14

15 APPENDIX A UNION PROPOSAL #14 WAGES - SECTION FOUR A) By December 11, 2014 December 6, 2018, each employee who was on the active payroll or on an authorized leave of absence of less than three (3) months on December 1, 2014 November 26, 2018 shall receive a supplemental wage payment of five hundred dollars ($500) one thousand ($1,000). B) By December 10, 2015 December 5, 2019, each employee who was on the active payroll or on an authorized leave of absence of less than three (3) months on November 30, 2015 November 25, 2019 shall receive a supplemental wage payment of five hundred dollars ($500) one thousand ($1,000). C) By December 8, 2016 December 3, 2020, each employee who was on the active payroll or on an authorized leave of absence of less than three (3) months on November 28, 2016 November 23, 2020 shall receive a supplemental wage payment of five hundred dollars ($500) one thousand ($1,000). D) By December 14, 2017, each employee who was on the active payroll or on an authorized leave of absence less than three (3) months on December 4, 2017 shall receive a supplemental wage payment of five hundred dollars ($500). The supplemental wage payment above 15

16 UNION PROPOSAL #15 APPENDIX B SAVINGS PLAN HOURLY EMPLOYEE SAVINGS PLAN PLUS 401(k) Plan Effective as soon as administratively practicable all eligible employees may elect to contribute up to the maximum of sixty-six ($66.00) one hundred $100 dollars ($100) weekly in one-dollar ($1.00) increments. The Company will match employee weekly contributions into the plan at a fifty percent (50%) rate. Additionally, employees will be able to contribute up to one hundred dollars ($100.00) the IRS maximum per week in unmatched funds into their savings plan accounts. 16

17 APPENDIX B SAVINGS PLAN CAPITAL ACCUMULATION PLAN CURRENT: UNION PROPOSAL #16 A) Effective July 1, , a Company contribution of three hundred and twenty-five dollars ($325.00) seven hundred and fifty ($750.00) will be made to each employee's account for each quarter that the employee is actively at work. Funds will be immediately vested and subject to investment at the discretion of the employee into the same options available under the Hourly Employee Savings Plan Plus. B) Effective July 1, , a Company contribution of three hundred and fifty dollars ($350.00) seven hundred and fifty ($750.00) will be made to each employee's account for each quarter that the employee is actively at work. Funds will be immediately vested and subject to investment at the discretion of the employee into the same options available under the Hourly Employee Savings Plan Plus. C) Effective July 1, , a Company contribution of three hundred and seventy-five dollars ($375.00) seven hundred and fifty ($750.00) will be made to each employee's account for each quarter that the employee is actively at work. Funds will be immediately vested and subject to investment at the discretion of the employee into the same options available under the Hourly Employee Savings Plan Plus. D) Effective July 1, 2017, a Company contribution of four hundred dollars ($400.00) will be made to each employee s account for each quarter that the employee is actively at work. Funds will be immediately vested and subject to investment at the discretion of the employee into the same options available under the Hourly Employee Savings Plan Plus. 17

18 APPENDIX B SAVINGS PLAN NEW SECTION IAMAW PENSION PLAN UNION PROPOSAL #17 IAM NATIONAL PENSION FUND STARD CONTRACT LANGUAGE CBA INSERT ARTICLE - PENSIONS A. The Employer shall contribute to the IAM National Pension Fund (the Fund ) for each hour/day* for which employees in the job classifications listed below are covered by this Agreement are entitled to receive pay under this Agreement as follows: $ 1.00 For Each Hour (X) For Each Day ( ) effective March 18, 2018 $ 1.25 For Each Hour (X) For Each Day ( ) effective March 18, 2019 $1.50 For Each Hour (X) For Each Day ( ) effective March 18, 2020 * All groups shall negotiate either an HOURLY or DAILY contribution rate as follows: Hourly or Daily rate standard work week is at least 40 hours based on 5 work days. Hourly rate standard work week is at least 40 hours but less than 5 days. Daily rate standard work week is 5 days but less than 40 hours. If the employee is paid only for a portion of an hour/day, contributions will be made by the Employer for the full hour/day. The contribution rates above apply to the following job classifications: (X) All job classifications covered by this Agreement ( ) Only the following job classifications**: ** Note: Any excluded job classifications above must be covered under a separate Standard Contract Language specifying their applicable contribution rate. The parties have negotiated to limit contributions to a maximum contribution for each employee as follows (please mark only one): ( ) 40 hours per week (X) 2080 hours per year (with no weekly maximum) ( ) No weekly or annual maximum 18

19 B. The Employer shall continue contributions for all contractually obligated time paid. C. If the parties agree to any exceptions to Section B, they must be listed below: (X) 1. None D. The parties may negotiate that contributions will continue bases on a forty (40) hour work week when an employee is on unpaid leave for union business: Yes (X) No ( ) If yes, indicate how long: Until loss of seniority E. Contributions for a new, temporary, probationary, part-time and full-time employee are payable from the first day of employment. The parties may negotiate that contributions will begin at the completion of the employee s probationary period, but no later than sixty (60) calendar days after date of hire. If contributions are to begin later than 60 calendar days after date of hire, the exclusion may require approval by the Trustees. 1) Will contributions begin from date of hire? Yes ( ) No (X) 2) If no, will contributions begin at the completion of the probationary period but not later than 60 calendar days after date of hire? Yes ( ) No (X) 3) If no, indicate length of time contributions will be excluded (specify calendar or working days) 30 calendar days 4) Indicate the length of the probationary period 90 calendar days. 5) Does the company hire temporary employees? Yes ( ) No (X) 6) Will contributions for temporary employees begin from date of hire? Yes ( )No ( ) 7) If no, will contributions for temporary employees begin at 90 calendar days? Yes ( ) No ( ) 8) If no, indicate the length of time contributions will be excluded for temporary employees (specify calendar or working days) F. The Employer adopts and agrees to be bound by, and hereby assents to, the IAM National Pension Fund Amended and Restated Trust Agreement, including all amendments thereto, whether adopted before or after the date of this Agreement ( Trust Agreement ), which is incorporated into this Agreement and made a part hereof, and the Plan rules adopted by the Trustees of the Fund (the Trustees ) in establishing and administering the foregoing Plan pursuant to the Trust Agreement, as currently in effect and as the Trust and Plan may be amended from time to time. G. This Agreement shall remain in effect until the Employer is no longer require to make contributions to the Plan. Subsequent rate increases may be implemented through a separate Letter of Agreement or renewal Collective Bargaining Agreement between the bargaining parties. H. The parties may increase the Contribution Rate and/or add job classifications or categories of hours for which contributions are payable. The parties acknowledge that the Trustees may terminate the participation of the employees and the Employer in the Plan for reasons including, but not limited to, if the successor collective bargaining agreement fails to renew the provisions of this pension Article or reduces the Contribution Rate. 19

20 I. This Article contains the entire agreement between the parties regarding pensions and retirement under this Plan and any contrary provisions in this Agreement shall be void. No oral or written modification of this Agreement shall be binding upon the Fund unless agreed to in writing by an authorized representative of the Fund. No Grievance procedure, settlement or arbitration decision with respect to the employer s obligation to contribute shall be binding upon the Fund, unless the Fund has agreed to be a party to such proceeding. --END OF STARD CONTRACT LANGUAGE-- 20

21 APPENDIX C UNION PROPOSAL #18 GROUP INSURANCE PLANS EMPLOYEE CONTRIBUTIONS Employees on the active payroll will contribute to their medical plan at the weekly rates indicated below. Weekly payroll deductions may be pre-tax dollars. LM HealthWorks Plan (LMHW) EMPLOYEE 8% 8% 8% 10% of the cost of the plan selected EMPLOYEE PLUS ONE 8% 8% 8% 10% of the cost of the plan selected EMPLOYEE PLUS TWO 8% 8% 8% 10% OR MORE of the cost of the plan selected HMO Medical Plan EMPLOYEE 8% 8% 8% 10% of the cost of the plan selected EMPLOYEE PLUS ONE 8% 8% 8% 10% of the cost of the plan selected EMPLOYEE PLUS TWO 8% 8% 8% 10% OR MORE of the cost of the plan selected The Company will continue to pay 92% of the cost of the LMHW or HMO medical plans until December 31, 2017 May 20, The employee will contribute 8% of the cost of the LMHW or HMO medical plans until December 31, 2017 May 20,

22 APPENDIX C INSURANCE UNION PROPOSAL #19 ACCIDENT SICKNESS Employee Accident and Sickness insurance with a weekly benefit of three hundred and fifty dollars ($350.00) four hundred and fifty dollars ($450.00) per week will be provided at Company expense. In addition to the company provided benefit, there will be a one hundred-dollar ($100) employee optional benefit. Employees electing to purchase the optional benefit will do so by weekly payroll deduction. 22

23 APPENDIX C INSURANCE UNION PROPOSAL #20 LIFE INSURANCE Employee life insurance will be provided at Company expense. The benefit will be increased to thirty-eight thousand dollars ($38,000) forty-five thousand dollars ($45,000.00). 23

24 APPENDIX C INSURANCE UNION PROPOSAL #21 ACCIDENTAL DEATH DISMEMBERMENT INSURANCE AD&D Insurance will be provided at Company expense. The benefit will be increased to thirty-eight thousand dollars ($38,000) forty-five thousand dollars ($45,000.00). 24