**Exhibit 10.5**

 

AGREEMENT

 

Between

 

BREMEN BEARINGS OF RBC USA, INC.

PLYMOUTH, INDIANA PLANT

And

 

INTERNATIONAL UNION, UNITED

 

AUTOMOBILE, AEROSPACE AND

 

AGRICULTURAL IMPLEMENT WORKERS OF AMERICA,

 

THEU. A.W.

 

And ItsLocal 1368

 

 

Effective August 10, 2002

 

----

 

AGREEMENT

 

Between

 

BREMEN BEARINGS OF RBC USA, INC.BREMEN, INDIANA PLANT

 

And

 

INTERNATIONAL UNION, UNITED

 

AUTOMOBILE, AEROSPACE AND

 

AGRICULTURAL IMPLEMENT WORKERS OF AMERICA,

 

THEU. A.W.

 

And ItsLocal 1368

 

 

Effective August 10, 2002

 

----

 

**INDEX**

** **
| **Article** |
|-------------|
|        |
| I           | Agreement |
|        |   |
| II          | Union Recognition |
|        |   |
| III         | Agency Shop and Check-Off |
|        |   |
| IV          | Cooperative Union Management |
|        |   |
| V           | Rights and Functions of Management |
|        |   |
| VI          | Strikes and Lockouts |
|        |   |
| VII         | Production Standards and Incentive Pay |
|        |   |
| VIII        | Job Evaluation Plan |
|        |   |
| IX          | Hours of Work and Overtime Pay |
|        |   |
| X           | Vacations and Vacation Pay |
|        |   |
| XI          | Holidays |
|        |   |
| XII         | Seniority |
|        |   |
| XIII        | Settlement of Differences |
|        |   |
| XIV         | Wages and Rates of Pay |
|        |   |
| XV          | Insurance  Benefits and Pensions |
|        |   |
| XVI         | Jury Duty, Bereavement and Military Reserve  Pay |
|        |   |
| XVII        | Safety and Health |
|        |   |
| XVIII       | Plant Rules |
|        |   |
| XIX         | Leave of Absence |
|        |   |
| XX          | Amendments and Modifications |
|        |   |
| XXI         | Termination and Notice |
|        |   |
|        | Appendix  “A” Rates of Pay Tier I Employees |
|        |   |
|        | Appendix  “B” Rates of Pay Tier II Employees |
|        |   |
|        | Appendix “C” Labor Units & Grade |
|        |   |
|        | Appendix  “D” Statement of Cooperation – Alcohol and Drug Abuse |

 

2

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**Article I****AGREEMENT**

 

**Section1.**

** **

This agreement, dated the 10th of August, 2002, is entered into betweenBremen Bearings, RBC, INC. of Plymouth**,** Indiana plant, (hereinafter called the“Company”) and the INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE ANDAGRICULTURAL IMPLEMENT WORKERS OF AMERICA (UAW) and its Local 1368 (hereinaftercalled the “Union”), effective the 10th of August, 2002.

 

**Section2.**

 

In consideration of this Agreement, the parties agree that it is theintent and purpose of the parties hereto that this Agreement is the completeAgreement covering rates of pay, hours of work and working conditions to beobserved between the parties, and to provide orderly relationships between theCompany and the Union, and to secure prompt disposition of difference betweenthe parties pertaining to the compliance with or application of this agreement.

 

**Section3.**

 

In recognition of its responsibility as the exclusive agent of theemployees, the Union agrees that it will actively cooperate in discouragingabsenteeism and tardiness, and that it will actively support proper Companyefforts to eliminate waste, improve quality, prevent accidents, and strengthengood will between the Company, the employees, the customers, the Union, and thepublic.  The Union also confirms that itsubscribes to the concept of a fair day’s work for a fair day’s pay.

 

**Section4.**

 

The rights provided in this Agreement shall apply only to employees whohave completed their 90-day probationary period, provided, however, that the probationaryperiod may be extended an additional 30 days by mutual agreement of the Companyand the Union.  Employees who have notcompleted their probationary period shall have no rights under Article XIII,Sec. 1, Step 3 of this Agreement.

 

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**Article II**

 

**Union Recognition**

 

**Section1.**

 

The Company recognizes the Union as the sole collective bargainingagency with respect to rates of pay, hours of work, and conditions ofemployment for employees engaged on jobs in Bremen Bearings, at its Plymouth,Indiana plant.

 

**Section2.**

 

The term “employee” as used in this Agreement, shall apply to allproduction and maintenance workers engaged on jobs at the Plymouth, Indianaplant who are on an hourly or incentive basis, but excludes watchmen, salariedemployees and supervisory employees with authority to hire, promote, discharge,discipline or otherwise effect changes in the status of employees oreffectively to recommend such action.

 

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**Article III**

 

**Agency Shop andCheck-off**

 

**Section1.**

 

Each employee who on the effective date of this Agreement is a memberof the Union in good standing and each employee who becomes a member after thatdate shall, as a condition of employment, maintain his membership in the Union.

 

Each employee hired on or after August 12, 1972, shall as a conditionof employment, beginning on the 30th day following the beginning ofsuch employment acquire and maintain membership in the union.

 

**Section2.**

 

The Company, for those employees who have heretofore, or hereafter bywritten authorization so directed, shall deduct from the first pay of eachmonth the proper Union dues for the previous month, an initiation fee for newmembers, the assessments and promptly remit same to the InternationalSecretary-Treasurer of the Union. Changes in dues and assessments will be made only as authorized inwriting by the International Secretary-Treasurer of the Union to the Company

 

**Section3.**

 

If an employee is on vacation the week that Union dues are withheld,the Company agrees to provide the Union with the names along with the hourlyrate that they were paid.

 

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**Article IV**

 

**Cooperative UnionManagement**

 

**Section1.**

 

The Company and the Union agree that they will not discriminate in thehiring of employees, or in their training, upgrading, downgrading, promotion,transfer, layoff, discipline, discharge or otherwise because of race, creed,color or national origin, age, union affiliations, sex, marital status ornon-disqualifying disability.

 

**Section2.**

 

The Company and the Union recognize the advisability of making everyeffort to constantly improve relationships between the Company, the Union andall employees.  To this end, a committeecomposed of two members of the Union and two members of management shall meetfor one hour at least once a month on Company time to discuss problems and/orgrievances which may cause a disruption in relationships or to suggest means ofimproving relationships.  The GeneralManager and the International Representative may attend these meetings.  The purpose of these meetings is to prevent,where possible, the use of the Arbitration Clause of this Agreement, as such isboth costly to the parties and further, bilateral good faith collectivebargaining is ineffective when a third party is called for the purposes ofdetermining the intent of the Agreement.

 

**Section3.**

 

a)                            Itis the duty of every employee to apply himself diligently to his work duringall of his working hours and to this end the Union will support the Company’sefforts to curb absenteeism and the practices which curtail production; toeliminate waste and inefficiency; to improve the quality of workmanship; toprevent accidents, and to promote good will between the Company and theemployees.

 

b)                           TheUnion will cooperate wholeheartedly with the Company in a concerted drive forbetter quality and quantity of production. It should be the responsibility of each employee to see that the workperformed is up to required standards and that no defective work is concealed.

 

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**Article V**

 

**Rightsand Functions of Management**

 

**Section1.**

 

The control of all matters relative to the management and operation ofthe plant and the operation of the Company’s business are vested exclusively inthe Company and shall constitute a management right, except as these mattersmay be expressly limited by the terms of this Agreement.  The Company and the Union in the exercise oftheir rights shall observe the provisions of this Agreement.

 

**Section2.**

 

The violation by either party of any provision of this Agreement shallnot render the Agreement inoperative, and the sole and exclusive method ofremedying any dispute which may arise hereunder shall be Article XIII,Settlement of Differences.

 

**Section3.**

 

While it is understood that the Company may experiment with equipment,it is not the intent of the Company to replace any bargaining unit employeewith a salaried employee through the exercise of this right.  Salaried employees may perform such workunder their jurisdiction as instructing, experimenting, or relievingimpediments in production, but no bargaining unit employee shall lose a workopportunity as a result.

 

**Section4.**

 

When work which the bargaining unit normally performs is to besubcontracted, it will be done on the basis of time or money or specialequipment or expertise.

 

When work is contracted out, the Company will inform the Union andexplain the necessity prior to the subcontracting.

 

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**Section5.**

 

The Company may utilize temporary employees to do the work of those onleaves of absences, vacations, and other absences, and for unpredicted customerdemands, to keep the operations running smoothly, but the Company can only usetemporary employees when there are no regular employees available who will fillthe need in the department on the shift. A temporary employee shall not work in excess of 90 days per year peremployee, unless the temporary employee is filling in for a regular employee onmedical leave, in which case the temporary employee may work for the durationof the medical leave.  The temporaryemployee will be paid at the second tier rate and will not be eligible forbenefits.  Temporary employees will beutilized only in positions of labor grades 1, 2, 3, 4, 5.

8

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**Article VI**

 

**Strikes and Lockouts**

 

**Section1.**

 

During the existence of this Agreement, the Union agrees that neitherit nor any employee shall engage in any strikes, sympathy strikes,****workstoppages, or slowing down of work, or any other interference with the normalproduction of the plant, or shipments from the plant products produced therein,or shipments of necessary materials to the plant.  Any violation of this Section by any employee shall be cause fordismissal or suspension.

 

In the event there is an interruption of production because of aconcerted action, the Union, through the International Representative and Localpresident, shall immediately direct cessation of such interruption.

 

**Section2.**

 

The Company, for itself, its supervisors and authorizedrepresentatives, agrees that during the term of this Agreement there shall beno lockouts in the Company’s plant.

 

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**Article VII**

 

**ProductionStandards and Incentive Pay**

 

**Section1.**

** **

It is understood that the Company may make, at any time; motion, timeor methods studies required for the efficient operation of its business, andmay establish standards and levels of performance, and may audit its standardswhen it deems this to be necessary in the interest of its business.  During the start-up and development periodfor equipment the employee operating machine will be paid his/her averageearned rate based on earnings during the prior week for a period not to exceedeight weeks.  Thereafter, the employeewill be paid average hourly earnings up to 120% of his/her base wage until theequipment is rated.  The Company has aright to assign any employee to operate a machine during the first eight weeksof the start-up and development period for the equipment.  Thereafter, departmental seniority will beused to determine the operator of this equipment until the equipment israted.  The Company will make reasonableefforts to establish a rate for new equipment within 120 days after theequipment has been released for consistent production.

 

**Section2.**

 

Once a production standard has been established, the equity of such astandard may be challenged under the procedure set forth in Article XIII,Settlement of Differences.  Should theUnion dispute the equity or fairness of a production standard, the Company willreview with a proper Union steward, upon his request, the data relating to theproduction standard.

 

**Section3.**

 

A production standard may be changed whenever a substantial andcontinuing change in material, method, specifications, or equipment, or anaccumulation of such changes, or an obvious clerical or mechanical error hasoccurred, that has a substantial effect on the productivity of the job.

 

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**Section4.**

 

It is recognized that the Company has the right to institute incentivestandards, with the understanding that such incentive standards shall be set insuch a manner so that qualified operators working at a normal pace can producework at 100% of standard.  Incentivejobs include:

 

Assembly

 

Incentive pay for second tier employees hired after 8/10/02 is cappedat 140% of standard plus 1⁄2% for each 1% above 140% of standard.

 

The Company guarantees that the incentive standard for the assembly jobshall be paid off of the base rate for the assembly department.

 

**Section5.**

 

When an employee performs any work that does not meet the requiredspecifications, he shall not receive any pay or credit for the work except forhis guaranteed base rate on a weekly basis. However, when the cause for rework is beyond the operator’s control,this provision will not apply.

 

**Section6.**

 

The Company and the Union will discuss and implement a performanceincentive program that is acceptable to both parties.

 

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**Article VIII**

 

**Job Evaluation Plan**

 

**Section1.**

 

Jobs shall be classified in their appropriate work grades by theCompany, using the National Metal Trades Association’s Job EvaluationPlan.  Job descriptions, labor grades,and rates of pay have been prepared and are in effect for all presentjobs.  When conditions warrant suchaction, the Company will establish new job classifications, change or add toand remove jobs or job descriptions. When new jobs are established, or changes or additions made to existingjobs, new job descriptions will be drawn and evaluated by the Company inaccordance with the NMTA Job Evaluation Plan. Union must be furnished a current copy of the NMTA Job Evaluation Planbeing used by the Company.  Where an incentiveand non-incentive job are combined, the remaining job will be an incentive jobif the preponderance (over 50%) of the job functions are functions of theincentive job.  Otherwise, the job willbe deemed a non-incentive job.

 

**Section2.**

 

All job rates of pay in effect at the time of this Agreement areeffective and properly evaluated and shall not be the subject to process underthe grievance procedure section of this contract.  Any new or changed job or job rate may be subject to processingunder Article XIII, Settlement of Differences. Such processing shall be confined to the result of the application ofthe NMTA Job Evaluation Plan.  The Planitself shall not be subject to processing under Article XIII, Settlement ofDifferences, nor shall it be, in any manner or detail, subject to arbitrationunder this agreement.

 

**Section3.**

 

The following method will be used in determining the work grade to beassigned to a job:  The job will beanalyzed and reviewed by the Company’s Job Analyst who will write up thedescription of the general details considered necessary to describe the principalfunctions of the job identified, which description shall not be construed as adetailed description of all of the work requirements that may be inherent inany given job.  A copy of all jobdescriptions shall be made available to the Union for their inspection andreview.

 

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**Article IX**

 

**Hours of Work andOvertime Pay**

 

**Section1.**

 

This Article is intended only to provide a basis for calculatingovertime.  It shall not be construed bythe Union or any of its members as limiting or guaranteeing the number of hoursto be worked by an individual employee or group of employees per day or perweek.

 

**Section2.****                       WorkWeek**

 

A normal work week shall consist of five consecutive eight hour daysfrom Monday through Friday except where off standard work weeks areestablished, in which event the work week shall consist of five consecutivedays followed by two days of rest.

 

**Section3.**

 

A day shall be defined as a consecutive 24-hour period beginning withthe starting time of an employee’s shift. Eight continuous hours of work, interrupted by regularly scheduled lunchperiods shall constitute a day’s work.

 

**Section4.**

 

Employees on temporary transfer to another department will work thehours as scheduled in that department during the transfer.  If they receive less than 16 hours notice ofa temporary transfer, they shall have the option of working either the hoursscheduled in their own department or those scheduled in the department to whichthe temporary move was made.

 

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**Section5.**

 

Except where an off-standard workweek is established, the standardthree and four shift schedules listed below shall be the hours of work, unlessby agreement between the Union and the Company they are altered.

 
| **Company Shifts:** |   | 7:00 a.m. to 3:00 p.m.  |
|---------------------|--------|-------------------------|
|                |   | 3:00 p.m. to 11:00 p.m. |
|                |   | 11:00 p.m. to 7:00 a.m. |

** **

**Four Shift operation:**

** **
| **WORKDAY**   |   | **A**  |   | **B**  |   | **C**            |   | **D**             |
|---------------|--------|--------|--------|--------|--------|------------------|--------|-------------------|
| **Sunday**    |   | Off    |   | Off    |   | Sat. 11:00 p.m.  |   | 3-11              |
|          |   |   |   |   |   | Sun. 7:00 a.m.   |   |              |
|          |   |   |   |   |   |             |   |              |
| **Monday**    |   | 7-3    |   | Off    |   | Sun. 11:00 p.m.  |   | 3-11              |
|          |   |   |   |   |   | Mon. 7:00 a.m.   |   |              |
|          |   |   |   |   |   |             |   |              |
| **Tuesday**   |   | 7-3    |   | 3-11   |   | Mon. 11:00 p.m.  |   | Off               |
|          |   |   |   |   |   | Tues. 7:00 a.m.  |   |              |
|          |   |   |   |   |   |             |   |              |
| **Wednesday** |   | 7-3    |   | 3-11   |   | Tues. 11:00 p.m. |   | Off               |
|          |   |   |   |   |   | Wed. 7:00 a.m.   |   |              |
|          |   |   |   |   |   |             |   |              |
| **Thursday**  |   | 7-3    |   | 3-11   |   | Off              |   | Wed. 11:00 p.m.   |
|          |   |   |   |   |   |             |   | Thurs. 7:00 a.m.  |
|          |   |   |   |   |   |             |   |              |
| **Friday**    |   | 7-3    |   | 3-11   |   | Off              |   | Thurs. 11:00 p.m. |
|          |   |   |   |   |   |             |   | Fri. 7:00 a.m.    |
|          |   |   |   |   |   |             |   |              |
| **Saturday**  |   | Off    |   | 3-11   |   | Fri. 11:00 p.m.  |   | 7-3               |
|          |   |   |   |   |   | Sat. 7:00 a.m.   |   |              |

 

When a department is placed on a 4-shift operation, all employees in theaffected department will be assigned to that schedule only.  The holiday schedule for the 4-shiftoperation shall be determined by the Company and union and posted by thebeginning (January) of each year.

 

It is understood that the Company will not resort to a four-shift basisbecause of lack of available equipment due to disrepair.  Employees working on the B shift shall bepaid at time and 1/8 for hours worked on Saturday.  Employees working on the C and D shift shall be paid at time and1/8 for hours worked on Saturday and time and 1⁄4 for hours worked on Sunday.

 

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Employees on the B shift will be paid the second shift premium andemployees on the C and D shifts will be paid the third shift premium.  In order to ensure cross training and ensurenew equipment/processes, the Company has the right to schedule employees towork shifts other than their regularly scheduled shift for a period not toexceed 4 weeks for training purposes.

 

**Section6.****                       Divisionof Overtime and Overtime Pay.**

 

All overtime shall bedistributed as equally as practicable within the department, classification andshift.  Overtime scheduling shall becompulsory for 50 hours and where scheduled absences and vacations must be covered.  In the case of scheduled vacations andscheduled absences, employees will be polled by seniority to fill in.  If there are no volunteers, the least senioremployees in the classification may be assigned.  On a daily basis, notification for scheduled overtime will be atleast two (2) hours prior to the end of the shift.  Notification for sixth and seventh day overtime will be posted asfollows:

 
| 1st shift |   | 3 p.m.  |   | Wednesday |
|-----------|--------|---------|--------|-----------|
|      |   |    |   |      |
| 2nd shift |   | 11 p.m. |   | Wednesday |
|      |   |    |   |      |
| 3rd shift |   | 11 p.m. |   | Wednesday |

 

A.                                   Except as providedin B, below, time and one-half shall be paid for all hours or parts of hoursworked:

(1)                                  In excess of eight(8) hours in any one workday.

(2)                                  In excess of forty(40) hours in any one workweek.

(3)                                  On Saturday, exceptfor off standard work weeks.

(4)                                  On the sixth day oftheir scheduled workweek for employees on off standard work weeks.

 

B.                                     Double time shallbe paid for all hours or parts of hours worked:

(1)                                  On Sundays, exceptfor off standard work weeks.

(2)                                  On the seventh day oftheir scheduled work week for employees on off-standard work weeks.

 

C.                                     Overtime rates andpremium rates shall not be paid to employees on more than one overtime orpremium basis whether hourly, daily, or weekly.

 

D.                                    Company liabilitywith respect to mis-scheduling of overtime shall be limited to a make-upturn.  In the event that an employee isbypassed for a make-up turn the Company will be liable for payment.  An employee who is not notified for anovertime turn within contractual limits shall not be charged with a turn.  An employee scheduled to work on his/her 6thor 7th day shall have a 24-hour notice of cancellation of such workexcept in emergencies.  If notice is notgiven, the employee scheduled will receive 4 hours pay at the appropriate rate.

 

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E.                                      If a holidayfalls on Friday or Monday and overtime is scheduled on the succeeding orpreceding Saturday, it will be on a voluntary basis.

 

F.                                      Where a workopportunity is lost, the Company shall be liable for four hours at a time andone half for work performed by salaried non-bargaining unit employees normallyperformed by bargaining unit employees.

 

**Section7.****                       Call in Pay**

 

Employees called into work within a twenty-four (24) hour period fromthe starting time of their shift shall be guaranteed a minimum of four (4)hours at their regularly assigned rate. This is provided that they report in within a reasonable amount of timefrom the call out.

 

**Section8.****                       Reportin Pay.**

 

Employees who report for work as scheduled or who report for work uponnotification to report shall, regardless of whether or not work is availablefor them be guaranteed a report in pay of no less than four (4) hours at theirregularly assigned personal rate.

 

Employees will not be paid under this section if:

(1)                                  Theyare unfit to work;

(2)                                  Workis unavailable as a result of causes beyond the control of management;

(3)                                  Theyare notified not to report for work within 24 hours notice;

(4)                                  They refuse toperform work available within their department unless such work is notavailable or they refuse to perform other work for which they are qualified.

 

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**Article X**

 

**Vacations andVacation Pay**

 

**Section1.**

 

The vacation year shall begin on January 1 and end on December 31.  The period for taking vacation time offshall begin with the first full week in January and end with the last full weekin December, with the understanding that this period shall not detract from theCompany’s right to establish a vacation shutdown period.  Plant shutdown shall be posted by the end ofthe last full month of the year.  Thevacation shutdown shall not be more than two weeks per year.

 

**Section2.**

 

Each employee who is actively on the payroll on December 31, or theSunday closest to December 31, shall be entitled to his full vacation benefitsnotwithstanding the fact that his services may have been terminated for anyreason in the ensuing year prior to the receipt of vacation pay.

 

**Section3.**

 

Employees who were not on the active payroll on December 31 or theSunday closest to December 31, but who become active thereafter as a result ofrecall or return from a leave of absence will receive vacation pay on aprorated basis computed at one-twelfth (1/12th) of his benefit foreach full month of service in the current vacation year.  Employees recalled on or before the 15thof any month shall be given credit for the full month.

 

Employees whose benefits are computed under this Section 3 shallforfeit such benefits if:

(a)                                                     Theyare discharged; or

(b)                                                    Theyresign without giving five (5) days written notice to the Company.

 

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**Section4.**

 

Effective July 17, 1999, vacation benefits for eligible first tier(hired on or before August 10, 2002) full time employees shall be as follows:

 
| **Accredited Service Prior to  December 31 of Vacation Year** |   | **Vacation  Time** |   | **Vacation  Pay Hours** |   |
|---------------------------------------------------------------|--------|--------------------|--------|-------------------------|--------|
| 1 year to 2 years                                             |   | 1 week and 1 day   |   | 68                      |   |
| 2 years to 10 years                                           |   | 2 weeks and 1 day  |   | 108                     |   |
| 10 years to 15 years                                          |   | 3 weeks and 1 day  |   | 148                     |   |
| 15 years to 20 years                                          |   | 3 weeks and 4 days |   | 172                     |   |
| 20 years and over                                             |   | 4 weeks and 1 day  |   | 188                     |   |

 

A first tier (hired on or before 8/10/02) employee will receivevacation pay at his/her average hourly earnings over either the first or secondof the two preceding six month periods (January 1 thru June 30 or July 1 thruDecember 31), beginning January 1, 2000.

 

A second tier (hired on or after August 10, 2002) will receive vacationtime and pay at his/her straight time base hourly rate as follows:

 
| **Accredited Service Prior to  December 31 of Vacation Year** |   | **Vacation  Time** |   | **Vacation  Pay Hours** |   |
|---------------------------------------------------------------|--------|--------------------|--------|-------------------------|--------|
| 1 year to 3 years                                             |   | 1 week             |   | 40                      |   |
| 3 years to 10 years                                           |   | 2 weeks            |   | 80                      |   |
| 10 years and over                                             |   | 3 weeks            |   | 120                     |   |

 

**Section5.**

 

Vacations are planned absences. With the exception of prior approval byHuman Resources, at least one-half of employees’ vacation must be taken inone-week increments and requested in writing for the calendar year by January31st**. **Vacation requestsafter January 31st must be applied for two weeks in advance inwriting.  A maximum of four single daysmay be taken for absences provided that one-hour prior notification to thebeginning of their shift has been given. All vacation will be approved or denied by Human Resources based on thefollowing criteria:

(a)                                  No more than 20% of adepartment will be allowed to take vacation unless specifically identified as adepartment or plant shutdown;

(b)                                 Peak performance timesor customer demands**;**

(c)                                  Seniority within thedepartment;

(d)**                                **ArticleXIX Leave of Absence.

 

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**Article XI**

 

**HOLIDAYS**

 

**Section1.**

 

The following days are those to which the provisions of this Articleapply:

 
| Day Before New Year’s Day |   | New Year’s Day    |
|--------------------------------|--------|------------------------|
| Good Friday                    |   | Memorial Day           |
| Independence Day               |   | Labor Day              |
| Thanksgiving Day               |   | Day after Thanksgiving |
| Day before Christmas           |   | Christmas              |

 

All employees with ninety (90) days continuous full time employmentshall be eligible to receive holiday pay provided they are on a working statusat the time of the holiday, and work the scheduled hours on the working daysbefore and after the holiday or the day in which the holiday iscelebrated.  Employees on leave ofabsence, layoff or otherwise unavailable or ineligible to work the day beforeor after the holiday are not eligible for holiday pay.  No more than 8 hours will be scheduled onthose days and the Company will be liable for the hours scheduled if it doesnot provide the work.

 

**Section2.****                       HolidayPay**

 

A.                                   Any work performedon a holiday shall be on a voluntary basis and the employees shall be paiddouble time for all hours worked on a holiday****in addition to the regularholiday pay.

 

B.                                     If a holiday fallsduring a paid vacation, the employee will receive an extra day off with pay ormay be paid in lieu of the holiday.

 

C.                                     Pay for theabove-mentioned holidays shall be on a one-pay basis only.  There shall be no pyramiding of overtime payfor holidays.  Regular holiday pay shallbe on the basis of eight (8) hours at the employee’s personal base rate.

 

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**Article XII**

 

**Seniority**

 

**Section1.**

 

The Company hereby recognizes the principle of seniority, and allseniority provisions shall operate on a departmental basis in accordance withthe procedures hereinafter listed in this Article.  Seniority shall accumulate from the original date of employmentfor every employee covered in this Agreement and said seniority rights shallcease upon the occurrence of any of the following acts or conditions.

 

(1)                                  A voluntary resignationor quit.

(2)                                  A discharge forcause.

(3)                                  A layoff of more than30 months or a leave of absence of more than one (1) year’s duration, however,in the case of a medical leave such leave may be extended by mutual agreement.

(4)                                  Failure to report forwork within five (5) working days from the date of recall from lay-off or leaveof absence.

(5)                                  Three working days ofno call, no show.

(6)                                  When an employee withless than one (1) year’s service is laid off, such employee shall have recallrights not to exceed one (1) year.

(7)                                  The Company willinform the Union President and the employee three days prior to the event of alayoff and/or recall to and from the street. An employee who is initially bumped will also****be notified three (3) daysin advance.

 

All employees with less than ninety (90) days of continuous serviceshall be considered probationary employees, provided the probationary periodcan be extended an additional 30 days by mutual agreement of the Company andthe Union.  After completion of the probationaryperiod, the employee’s record of continuous service will date back to theoriginal date of his employment.

 

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**Section2.**

 

A.                                   Seniority shall atall times be recognized for the purposes of upgrading and layoff and recallprovided the employee possesses the necessary skill and ability to perform thejob in question.

 

B.                                     The lead positioncommittee for the specific department will review all bidders for leaderpositions.  Bidders will be selected by****thelead position committee based on their skill, knowledge, and abilities.  If all bidders are equally qualified, thenseniority shall prevail.  These criteriawill apply to any newly created lead positions.** **The lead position committee will be made up of two (2) unionrepresentatives and two (2) management representatives.  The shop committee will determine the (2)union representatives.  The personselected for the lead position shall be by majority vote of the committee.

 

**Section3.****                       JobOpenings and Upgrading Procedure**

 

When the Company declares a job open there shall be shift preferencesright, which will operate within the department and classification, involvedbefore the open job is posted.

(1)                                  If no employee in theplant has recall rights to the open job, it will be posted plant wide so thatany employee previously qualified on the job may bid before an employee laidoff from the Company who has rights to that job is recalled.  If no person on layoff fills the open job,it will be posted plant wide so that any employee will have the chance to bidbefore hiring from outside.  This is notapplicable to grades 10, 11, and 12.

 

(2)                                  In the event a juniorworker in a department is transferred to another shift and the transfer exceedsforty-five (45) days, a bid for a shift preference must be posted when thevacancy is filled.  If the transfer doesnot exceed forty-five (45) days, the employee that was transferred will have toreturn to the shift.

 

When a job is posted for bid, it shall remain on the bulletin board fora period of four (4) working days including Saturdays and Sundays if a fourshift operation is instituted. Employees will also have the right to designate in advance with theCompany personnel office, their desire to upgrade to specific jobs.

 

A.                                   Any successfulapplicant for a job who moves into a new department shall take all hisseniority into that department upon demonstrating sufficient skill and abilityto perform the job equal to the department average, not to exceed a period ofninety (90) continuous days of work within the new department.  In the event of work force reduction,probationary employees will be considered as without rights and will be laidoff prior to other employees in the department.  With respect to those employees who have less than ninety (90)days in a department and are not probationary employees, Company seniority willdetermine which employee will be affected in case of layoff.

 

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B.                                     Any employee whofails to meet job requirements on any job where he/she is a successful biddershall be returned to his/her former job, department, and shift.

 

C.                                     After anyupgrading or award of a bid, an employee will be restricted from bidding againfor another job for a period of nine (9) months.  The restriction will be waived in the event that an openingoccurs in maintenance or in the tool room for L.G. six and above.  If after bidding on a posted job an employeeis disqualified by the Company, he/she may bid on another posted job at anytime, provided all means for filling that job have been exhausted inconformance with Article XII of the Agreement. After an employee has bid on a job he/she may disqualify him/herself onthat job at any time prior to the passage of twenty (20) consecutive workingdays or the Company may disqualify him/her in a ninety (90) day period.

 

After an employee has been disqualified from a job by the Company, hemay bid on that job again after a one-year period; however, if he is againdisqualified from the job he/she will not be permitted to bid on it in thefuture.  This restriction may be removedif employee has successfully demonstrated improved skills.

 

D.                                    Downward moves willonly be permitted once a suitable replacement has been found, for up to amaximum of one hundred twenty (120) days.

 

E.                                      Consistent withthe terms of this contract, an employee will have the right to move laterallyon an open job.

 

F.                                      The followingwill prevail for employees who are successful bidders on open jobs butcircumstances prevent them from moving:

 

1.                                       If after two (2)weeks from date of bidding the employee is still within department, he/she willreceive make up pay equal to his present step in the Labor Grade in which hewas the successful bidder.  Senioritywill commence in the new department at this time.

Note:  Incentive earnings forassembly will not be calculated on the make up pay; overtime will not be paidon make up pay, but will be paid on hours worked at straight time.

2.                                       Successfulbidders shall not be detained for any time in excess of six (6) weeks fromtheir bidding date unless approved by the employee.

3.                                       At the time ofthe actual transfer the employee will automatically be placed at a rate on theprogression rate scale per company policy.** **Ninety(90) day Company qualification will begin upon actual transfer to position.

 

G.                                     If an openingoccurs within 120 days of the award of the bid, the next eligible bidder willfill the position.  If there are noeligible bidders, the job will be reposted before the Company may hire from theoutside.

 

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## ***Section 4.***                       Lay Off and Recall

 

When an employee is laid off from his/her department and jobclassification he shall have the option of retrograding in compliance with (B)below or he/she may displace the least senior employee in his labor grade inhis unit.  If his seniority precludesthe displacement of any employee in his labor grade, he may bump the leastsenior employee on a lower base rate job within the unit.

 

A.                                   When a move has beeneffectuated under the seniority provisions of the contract, the affectedemployee will be allowed to exercise a shift preference so long as it isconsistent with his seniority.

 

B.                                     In the event of alay-off, the affected employee will be given the opportunity, senioritypermitting, to retrograde into any job previously qualified on while in theemployee of the Company.  Retrograde maymean upward, downward or lateral movement.

 

C.                                     After an employeehas exhausted all seniority moves under the provisions of the contract he willbe given the opportunity to bump a less senior employee in labor grade 6 andbelow, provided he can perform that job proficiently within a three (3)****weekperiod.

 

D.                                    After an employeehas exhausted all seniority moves under the provisions of the contract, he willbe recalled to any job by seniority in **Labor Grade 9** or below provided he hasn’twaived his rights to that job and he will be given up to three weeks todemonstrate proficiency on the job. This section is not applicable to maintenance and tool room jobs.

 

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E.                                      When an employeeis laid off, he/she will be asked whether he/she will accept recall to any jobor just his/her own.  If the employeewaives recall to other jobs, he will be recalled only to his own job.  If the employee accepts recall to jobs otherthan his own, he may not refuse those jobs when offered.  An employee, on layoff, may revise his/herstatus concerning the job or jobs to which he/she’ll return by notifying theCompany in writing.  Such notificationmay be made no more than twice a year during any given layoff.  Recall rights are for 30 months.

 

F.                                      If an employee isrecalled by the Company and subsequently disqualifies himself or isdisqualified by the Company, his subsequent placement will be in accordancewith Section 4, A, B, C, and D in the event of work force reduction,probationary employees will be considered as without seniority rights and willbe laid off prior to any other employees in the department.

 

G.                                     When an employeeis laid off from his/her job and replaces an employee with less seniority inanother job, said employee will have the option of going back to his/heroriginal job or stay on present job after 90 days.

 

 

H.                                    When an employee withless than one (1) year’s service is laid off, such employee shall have recallrights not to exceed (1) year.

 

## ***Section 5.***

This Article does not limit or guarantee the number of hours to beworked by any department or any employee. In the event of a curtailed workweek the days worked shall beconsecutive beginning on Monday except for off-standard work schedules.  If curtailment is necessary beyond four (4)weeks, the Union may discuss alternatives with the Company.

 

## ***Section 6.***

Bulletin Boards shall be provided for all seniority lists and otherUnion purposes as well.  It isunderstood that the Union officers shall submit any document to be posted onthe bulletin boards to the appropriate representative of management for hisapproval prior to posting.

 

## ***Section 7.***

It is understood that the following Union officers shall have topseniority during their respective terms of office:

 
| 1. |   | President                    |
|----|--------|------------------------------|
| 2. |   | Vice President               |
| 3. |   | Financial Secretary          |
| 4. |   | Recording Secretary          |
| 5. |   | Bargaining Committee Members |

 

This seniority shall be for the purpose of layoff and recall only.  The four top Union officers shall beassigned to the first shift.

 

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**Section8.**

 

The committeeman on each shift shall hold top seniority on his respectiveshift for the purpose of layoff and recall only.  This seniority shall not take precedence over the officers aslisted in Section 7.  This provisionprotects Union officers from the vagaries of bumping/layoff during the terms ofoffice.  Therefore they are to remain onthe shift to which they are assigned until the abolition of that shift or uponvoluntary removal to another shift.  Onthe other hand, this provision in no way permits a Union officer to use hisprivileges for purposes of vacation or promotion preference, etc.  To allow the bumping of Union committeemenor officers without respect to shift retention, it is technically possible tohave them all confined to one shift while the other shifts have norepresentation.  This was never the intention,since such an eventuality would leave Company-Union contracts in an unworkablestate.

 

**Section9.**

 

It is understood that any employee promoted from the bargaining unitwill have 60 days to return with his accumulated seniority except for 30days.  If the employee does not returnto the bargaining unit in that time, he will lose all his seniority and mayreturn thereafter only as a new employee. Any return to the bargaining unit must be to a posted job.  If there is not posted job, the affectedemployee may bump the least senior employee whose job he can perform.  The job in question must be labor grade 7and below.

 

**Section 10.**

 

Employees applying for jobs in Labor Grade 8 and above shall berequired to pass a job test in connection with job openings in such laborgrades.  The following procedure willapply:

 

A.                                   The Company willreimburse 100% of tuition for any required courses providing completion ofcourse with a grade “C” or at least a 72%.

 

B.                                     Testing will beadministered and evaluated by an independent agency.

 

C.                                     Openings will befilled from within on a seniority basis providing applicants pass the test witha grade “C” or at least a 72%.  If noone qualifies, the Company may seek outside applicants.  A joint Union-Company trades committee willbe established to oversee the program.

 

D.                                    It is the policy ofthe Company to encourage its employees to prepare themselves voluntarily forincreased responsibility by studying accredited semi-technical, andprofessional subjects related to the Company’s business.  To aid the employee, the Company hasinstituted a Tuition Refund Plan by which 75% of the tuition paid by eachemployee will be refunded on approved and satisfactorily completed subjects.

 

E.                                      If an openingoccurs in the Tool room and it cannot be filled with a qualified employeeeither in or out of the plant, the Company may establish a training program tofill the job.

 

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**Section11.**

 

Shift preference may be exercised twice****per year, and an employeemust stay on the shift for six months after exercising this right.  It is the obligation of the employee tonotify the Company two weeks in advance if he wishes a shift preference, andtransfers will occur only on a Monday, unless otherwise agreed to.  In exercising the shift preference, theemployee will bump the last senior employee in the same job on the shift hedesires to transfer to provided his seniority is greater.  The displaced employee will then bump theleast senior employee in the same job on the next shift of priority, providedhis seniority is greater.

 

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**Article XIII**

 

**Settlement ofDifferences**

## ***Section 1.***

 

A grievance shall be defined as any dispute which arises between theCompany and the Union over the compliance with or application of this Agreementas it pertains to any bargaining unit employee, and all such differences shallbe settled in the following manner.

 

**StepI.****                                     **Theemployee shall first attempt to resolve any grievance dispute with his/herimmediate supervisor.  The employee mayrequest to have his/her committee-person present when he/she talks with thesupervisor. ** **If the dispute is notsettled in accordance with an oral discussion between the supervisor, theemployee and/or the committeeman, then the dispute must be reduced to writtengrievance and submitted to the Supervisor or his/her designee****withinfive (5) working days from the date of the initial discussion with thesupervisor.  The supervisor will providewritten response within (5) working days upon receipt of the writtengrievance.  If the dispute still remainsunsettled, it will be submitted to Step II.

 

**StepII.****                                 **Withinfive (5) working days from the date of receipt of a written grievance by the****HumanResources Manager, it shall be heard by the Step II committee.  The Step II Committee****shall consist of tworepresentatives of management and two representatives of the local Union andthe Grievant**. **If the partiescannot conduct a Step II hearing within five (5) working days from the date ofreceipt ofthe****written grievance, the parties, by mutual agreement, mayextend the time limit.** **Ifthe grievance in Step II is not heard within the five (5) working days timelimit or the extended time agreed upon by the parties, it will be placedimmediately on the Third Step Agenda.****If the dispute still remains unsettled****afterthe Step II hearing**,**it will be placed on a Third Step Agendawithin five (5) working days following the hearing in Step II.

 

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**StepIII.****                             **TheUnion must schedule the Step III meeting within five (5) working days.  If the grievance in Step III is notscheduled within the five (5) working day limit or extended by mutual agreementit will be dropped by the Union.  TheStep III committee shall hear all cases which have been unresolved in Step II.The Step III committee****shall consist of two representatives ofmanagement and the President, Vice President, Financial Secretary and RecordingSecretary of the local Union.  Inaddition, the General Manger and a representative of the International Unionmay sit in on any third step hearing. The Company shall present its Step III response within five (5) workingdays of the third step hearing. In the event that the dispute is not resolvedin the third step, the Union may file the said difference for arbitrationwithin ten (10) working days after the date of the third step response. If theunion does not request arbitration within the ten (10) working day period, thegrievance shall be dropped by the Union. But the said ten (10) working days may be waived by mutual agreement inwriting****betweenthe Union and the Company so as to further discuss the subject of the disputeunder the cooperative management clause of this Agreement.

 

The parties by mutual agreement may submit any grievance to non-bindingmediation before a mediator assigned by the Federal Mediation and ConciliationService without waving the right of the Company or the Union to submit thegrievance to binding arbitration in the event non-binding mediation does notresolve the grievance.

 

## ***Section 2.***

If a grievance hereunder is referred to arbitration, the parties willuse the arbitration procedures of the Federal Mediation and Conciliation****Service.  The parties will alternate as to which partywill strike its first name in an arbitration panel.  If a grievance is submitted to arbitration, the decision of thearbitrator shall be final and binding on both parties and any costs withrespect to said arbitration shall be borne equally between the parties.  The cost of the court reporter andtranscript shall borne by the requesting party(ies).

 

## ***Section 3.***

No issue in dispute under this Labor Agreement shall be arbitrableunless the said issue involves the meaning, application of, or compliance witha specific provision of this Agreement or the intent thereof and****unlessthe grievance has been timely filed. The arbitrator shall not add to, subtract from, or modify any of theprovisions of this Agreement, and shall not reverse management’s decision incases involving discipline or discharge except when, in the judgment of thearbitrator, management has acted without just cause.  The arbitrator’s award shall in no case be retroactive beyond 30days prior to the filing of the written grievance which constituted the issuein question.

 

## ***Section 4.***

All grievances must be filed within five (5) working days from the dateof its known occurrence.  In no case,however, shall the Company’s liability for retroactive pay exceed a period of thirty(30) days prior to the date on which the grievance is filed.  Grievances not so filed shall be deemed tohave been waived and shall not be raised thereafter.  Grievances resolved in either Step I, II, or III above shall beconsidered satisfactorily settled, closed on the record, and shall not bereopened.

 

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## ***Section 5.***

Grievances that shall arise between the Union and the Companyconcerning employee discipline shall have priority over all other cases underthis Article XIII of the Labor Agreement.

 

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# **Article XIV**

 

**Wages and Rates ofPay**

## ***Section 1.***

 

Wage rates for Tier I employees are listed in Appendix A.

Tier I rates apply to employees hired before August 10, 2002.

 

Wage rates for Tier II employees are listed in Appendix B.

Tier II rates apply to employees hired August 10, 2002 and after.

 

## ***Section 2.***

 

New employees without previous experience will be hired at theappropriate rate as shown on the progression rate scales outlined in Appendix“B” of this Agreement.

 

The first step of the four steps on the Progression Scale will notapply to employees bidding to another labor grade.

 

The four-step Progression Scale will only apply to new employees hiredafter July 22, 1978

 

**Section 3.**

Employees who have some experience will be placed at a rate on theprogression rate scale commensurate with their experience and ability toperform the job between the minimum hiring rate for the labor grade up to andincluding the full job rate if the employee is fully qualified.  In no case shall any employee receive lessthan his present rate when he is accepted for training on another job providedthe move is lateral or up.

 

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**Section 4.**

Any employee on a progression rate shall be reviewed periodically andappropriate adjustments shall be made on the basis of the review period untilthe employee reaches the full rate of the job. Employees in all labor grades shall be reviewed a minimum of everythirty- (30) days and progressive adjustments will be granted provided theemployee demonstrates appropriate progression in skill, ability and performanceon the job.

 

**Section 5.**

Employees working on a scheduled second shift shall be paid a nightshift premium of $.25 per hour. Employees working on a scheduled third shift shall be paid a night shiftpremium of $0.27 per hour.  Employeesassigned to one shift shall not receive a premium applicable to another shiftfor any reason.

 

**Section 6.**

Any employee on transfer to another job shall be paid the rate ofhis/her job or the rate of the job to which he/she is transferred, whichever ishigher.  An incentive employee will bepaid five (5) labor grades higher than his/her base rate in those cases wherethe job to which he/she is transferred causes a loss of earnings.  Temporary transfers will not exceed ninety(90) days in a year unless otherwise agreed to.  If a transfer exceeds ninety (90) days, the job will beposted.  The Company may temporarilytransfer an incentive employee to another job based on skill and ability incases of absence and vacation and to expedite work.  If the transferred employee is the non-junior employee, theemployee will be paid average hourly earnings up to 120% of base rate.  If the transfer exceeds 30 continuous days,then the employee will be paid average his/her hourly earnings thereafter.  In addition, the Company may temporarily transferan employee to another department to train another employee, in which case thetransferred employee will be paid average earned rate from the last full weekworked.

 

**Section 7.**

Effective immediately, employees operating on machine-controlledincentive standards who are training new operators will be paid three (3) laborgrades higher than their present classifications.      Training will be conductedin accordance with the Company’s Training Plan.  Training time will be considered as time spent with a newoperator. When assembly operators train other employees they will be paid the topstep of labor grade 4.

 

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# **Article XV**

 

**Insurance****, Benefits,Pensions and 401(k) Plan**

 

## ***Section 1.***

Pension, 401(k) plan, health, and dental insurance benefits are setforth in documents that are separate and apart from this contract booklet.

## *** ***

## ***Section 2.***

First tier employees (hired before 8/10/2002) coverage will pay $14.00per week in health insurance premium payments****during the first year ofthis contract (8/10/2002 – 6/30/2003); $14.00 per week during the second yearof this contract (7/1/2003 – 6/30/2004) plus 50% of any premium increase up toa maximum of $10.00.

 

Second tier employees (hired after 8/10/2002) coverage will pay $20.00per week in health insurance premium payments****during the first year of thiscontract (8/10/2002 – 6/30/2003); $20.00 per week during the second year ofthis contract (7/1/2003 – 6/30/2004) plus 50% of any premium increase up to amaximum of $10.00.

 

First tier employees (hired on or before 8/10/2002) who elect dentalcoverage will pay $2.00 per week in premium payments during the first year ofthis contract (8/10/02002 – 6/30/2003); $2.25 per week during the second yearof this contract (7/1/2003 – 6/30/2004).

 

Second tier employees (hired on or before 8/10/2002) who elect dentalcoverage will pay $5.00 per week in premium payments during the first year ofthis contract (8/10/2002 – 6/30/2003); $6.00 per week during the second year ofthis contract (7/1/2003 – 6/30/2004).

 

## ***Section 3.***

All Employees who are covered under their spouse’s medical insurancepolicy and who opt out of coverage under the Company’s medical insurance policywill be paid $100.00 monthly for single (spouse covered under separate policyprovided by spouse’s employer) and $200.00 monthly for family coverage.  Employees who opt out of coverage under theCompany’s policy must provide evidence of medical insurance under anotherinsurance policy.

 

**Section 4.**

With respect to pension service credits, all active employment timeaccrued prior to the acquisition of the Bremen Bearing Company by RBC, Inc.shall be counted as years of service for pension eligibility purposes.

 

**Section 5**.

The Company will pay the cost of Medicare supplemental insurancepremiums, up to $100.00 monthly for employees retiring during the term of thisagreement.

 

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**Section 6.**

The pension payment for employees (hired before 8/10/2002) shall be$28.75 per month per year of service for employees who retire after June 30,2002.  The payment shall increaseanother $.25 (from 28.75 to 29.00) per month per month per year of service foremployees who retire after June 30 2003.

 

Effective January 1, 2003, all second tier bargaining unit employeeswith six full months of service shall be eligible to participate in the (401)kplan provided by RBC Corporation (hereafter the “RBC 401k Plan”) subject to allthe terms and conditions of that plan. The RBC 401k plan may be changed from time to time, consistent withcorporate-wide changes made to the RBC 401(k) plan, without furtherconsultation or bargaining with the Union, provided that the Union is givennotice of such changes at least four (4) weeks in advance of such changes.  The employee may contribute 1% to 15% of his/hersalary pretax. The Company will make a 50% matching contribution of the pretaxamount of the employee’s contribution up to a maximum of 5%.  The employee’s contribution shall be 100%vested immediately, and the Company’s contributions shall be vested 100% afterthree (3) vesting years.

## *** ***

## ***Section 7.***

Weekly accident and health benefit will be $240****from Aug 10, 2002 to July31, 2003; $250 from Aug. 1, 2003 to July 31, 2004.

## *** ***

## ***Section 8.***

The amount of group life and accidental death and dismembermentinsurance for active first tier employees (hired before 8/10/02) will be$10,000.  Second tier life insurancewill be $8,000.  Life and accidentaldeath and dismemberment insurance for active employees age 66 or over will be$6,500.  Life insurance is continuedupon retirement under the Pension Plan****but is reduced to $1,800 upon attainmentof age 66, $1,600 upon attainment of age 67, and $1,500 upon attainment of age68 and thereafter.

## *** ***

## ***Section 9.*** Payroll deductions

The Company agrees to make weekly payroll deductions to up to threeaccounts.  The Company assumes noobligation other than three deductions per employee, per payroll period.

## *** ***

## ***Section 10.*** Eye Exam

Approved safety glasses must be worn by all employees in themanufacturing operation.  The Companywill provide safety glasses as described below.

 

The Company will provide annual eye exams for the employees in jobswhere accurate vision is a requirement, such as Inspectors.  Eye exams will also be provided where theemployee is not covered under the Company provided or another insurance policy.

 

The Company will schedule annual visual exams as follows:

•                  Full exams whenan employee starts in Inspection and every two years thereafter,

•                  Progressiveexams the year between full exams

 

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The Company will pay for the following:

•                  One pair ofapproved safety glasses (frames and lenses), every 24 months for employeesrequiring prescription glasses.

•                  Replacementlenses every 12 months if eye exam warrants the corrected lenses.

 

Non-prescription safety glasses are issued to employees by thesupervisor.  Damaged glasses should bereturned to the supervisor to receive a replacement.

## *** ***

## ***Section 11.*** Miscellaneous

The Company will supply coveralls for use by the maintenancedepartment.

 

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# **Article XVI**

 

**Jury Duty, Bereavement and Military Reserve Pay**

 

## ***Section 1. ***Jury Duty Pay.

Any employee who is called for Jury Duty service shall be excused fromwork for the days on which he serves. He shall receive for each such day of jury service on which he otherwisewould have worked, the difference between eight (8) hours of pay at his/herassigned base rate and the payment he/she receives for jury service.  The employee will present proof of serviceand the amount of pay received therefore.

## *** ***

## ***Section 2. ***Bereavement Pay.

Employees will be paid by the Company for time lost due to death in theimmediate family.  Such pay to be nomore than their assigned rate for a period not in access of three (3) workdays.  Immediate family includes mother,father of employee, husband or wife, children, brother or sister,mother-in-law, father-in-law, grandchildren, stepchildren, stepparents,grandparents, son-in-law and daughter-in-law. The three days allowed must betaken.  In other words, no pay can betaken in lieu of the time allowed off. If a person decides they only want one or two days off and wishes towork, this is his/her option.  The daysoff must be consecutive and only at the time of the funeral.  The employee cannot take one day at the timeof the funeral and two days two months later for the same bereavement.  In case the three days include Saturday andSunday, the employee will not lose two paid days, but will take two additionaldays for Saturday and Sunday.  Forexample, the employee would take off Friday, Monday and Tuesday with pay.  If the bereavement occurs during theemployee’s vacation, the three days allowed should be taken immediately afterthe termination of the vacation time. The vacation time does not count against the three days allowed.  If a holiday falls on one of the three daysallowed, an extra day can be taken with pay.

 

Employees will be allowed one day off with no pay due to the death of aspouse’s grandparents.

## *** ***

## ***Section 3. ***Military Reserve Training Pay

An active employee who is required to attend Military Reserve TrainingEncampment will receive the difference in pay between his assigned base rateand payment received for his military service. Payment hereunder shall be based on proof of service and shall notexceed a period of eighty (80) hours.

 

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# **Article XVII**

 

**Safety and Health**

 

## ***Section 1.***

The Company as prescribed under the Laws of the State of Indiana andthe United States shall provide heating, lighting, toilet, locker, and sanitaryfacilities and all protective devices necessary to protect the health ofemployees.  The Union will at all timescooperate with and assist the Company in maintaining and improving safety andhealth conditions in the plant.

## *** ***

## ***Section 2.***

The Company will make every effort to avoid scheduling only oneemployee per shift.

## *** ***

## ***Section 3.***

The Company has the right to conduct Drug & Alcohol testing forcause and reasonable suspicion in accordance with the Company’s drug andalcohol policy, attached as Appendix D. Positive test results will result in disciplinary action up to andincluding termination.

 

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# **Article XVIII**

 

Plant Rules& Disciplinary Action

 

## ***Section 1.***

The Company shall have the right to issue rules and reasonableregulations from time to time governing the conduct of employees in theworkforce, and it is the duty of each employee to familiarize himself/herselfwith such rules and regulations and to comply herewith.  This does not constitute acceptance by theUnion of any specific rules not in compliance with the provisions of thisAgreement.

 

The union reserves the right to grieve the rule.

## *** ***

## ***Section 2.***

Disciplinary action will be conducted as follows:

 
| Step 1. |   | Verbal warning  |   | Step 3. Suspension 1-5 days |
|---------|--------|-----------------|--------|-----------------------------|
| Step 2. |   | Written warning |   | Step 4. Termination         |

 

Steps may be skipped due to the seriousness of the event up to anincluding immediate termination.  Allsteps will be documented and remain in employee’s file.  However, actions will become inactive asfollows (providing no other disciplinary action is taken):

 
| Step 1 |   | 6 months  |   | Step 3 |   | 12 months           |
|--------|--------|-----------|--------|--------|--------|---------------------|
| Step 2 |   | 12 months |   | Step 4 |   | Will not be removed |

 

Management has the right to administer disciplinary action inaccordance with company policy.

 

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# **Article XIX**

 

**Leave of Absence**

 

## ***Section 1.***

A.                                   Employees who are tobe absent for more than five working days for personal illness or physicaldisability and who have acquired one (1) year of service with the Company, willbe granted a leave of absence up to one (1) year.  Employees with sixty days seniority, but less than once (1) yearof service will be granted a leave of absence for the period equal to theirlength of service.  Leaves of absencewill only be granted upon written request and when accompanied by a physiciansstatement justifying the reason.  Suchleaves will be granted without pay except seniority will accumulate for theduration of the leave.

 

Requests for personal leaves of unusual reasons may be made through theHuman Resources Manager.  Such leaves,if granted, shall not be in excess of two weeks.  Paid time available, such as vacation, may be used at theemployee’s request.

 

B.                                     Employees applyingfor a medical leave of absence or returning from a leave of absence may besubject to a medical examination and approval by a Company appointed physician.

 

C.                                     An employee with aphysician’s statement must renew medical certification every thirty–(30) days.

 

D.                                    Family MedicalLeave Act

                                                Timeoff for medical leaves of absences will run concurrently with Family MedicalLeave (FML) if the employee is eligible under the provisions of Family MedicalLeave Act (FMLA).  The Company willadminister FML with a 12-month rolling period. Paid time available, such as vacation, may be used at the employee’srequest. Required documentation must be completed as required by the Act.

## *** ***

## ***Section 2.***

Any employee who is elected or appointed to a position with theInternational Union (UAW) will be granted a leave of absence for the durationof his assignment upon written request by the International Union.  Seniority will accumulate during such leavebut without pay or other benefits except for pension purposes.

## *** ***

## ***Section 3.***

A.                                   Failure to report towork within five days after the expiration of a leave of absence or extensionthereof shall constitute a voluntary resignation

 

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B.                                     Employeesreturning to work after a leave of absence will be placed on the same job heldat the beginning of the leave based on their seniority and provided they areable to perform the full job requirements.

## *** ***

## ***Section 4.***

A.                                   Any employee who hasbeen granted a leave of absence and who while on leave of absence, seeks oraccepts other employment or who engages in any business or occupation shall beconsidered as having voluntarily quit. Exceptions to this Section may be made by mutual agreement.

## *** ***

## ***Section 5. ***Other Leave of Absences

Other leave of absences include illness or injury of a family memberthat may be eligible under FMLA, military duty, jury duty, bereavement, andpersonal leave.  Proper documentationand approval is needed as required by the Company.  Paid time available, such as vacation, may be used at theemployee’s request.

## *** ***

## ***Section 6. ***Payment of Insurance Premiums during Leave ofAbsences

Employees will be required to pay their share of insurance premiums,and may elect to pay them in two different ways.

1.                                       Employee mayelect to pay by the 25th of the month while they are out on leave ofabsence; or

2.                                       Employee maydesignate payment upon return to work on a basis of 1.5 times regular weeklypremium until the premiums are recouped.

 

39

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# **Article XX**

 

**Amendments and Modifications**

## *** ***

## ***Section 1.***

Neither party shall be obligated to negotiate further on any matterduring such term.  This Agreement may,however, be modified by mutual agreement of the parties, provided that all suchmodifications are in writing and properly executed.  This Agreement supersedes and voids all prior agreements, if any,written or oral, or established by custom, practice, or precedent.  In the event of the provisions of thisAgreement shall become invalid or unenforceable by reason of any federal orstate law or executive order now existing or hereafter enacted, such invalidityor unenforceability shall not have any effect on the remaining provisions ofthis Agreement.

## *** ***

## ***Section 2.***

No amendments or modifications of this Agreement shall be valid exceptwhen committed to writing and signed by the authorized representatives of bothparties.  The authorized representativesof the Union shall include the duly authorized representatives of theInternational Union and the duly authorized representatives of the Local UnionNo. 1368.

 

40

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# **Article XXI**

 

**Termination and Notice**

## *** ***

## ***Section 1.***

This agreement between the parties shall remain in force for the periodcommencing on August 10, 2002 and ending 12:00 midnight on August 9, 2004.  It shall automatically renew itself fromyear to year thereafter unless written notices of the desire to terminate oramend any portion of any of the terms hereof is given by either party to theother, at least sixty (60) days prior to August 9, 2004, or in the event thisAgreement is renewed such notice shall then be given at least sixty (60) daysprior to any subsequent annual expiration date.

 

If notice of the desire to terminate or amend shall be given, asprovided in the preceding paragraph, negotiations for the new or amendedAgreement shall being not later than ten (10) days subsequent to such notice,and shall continue until agreement has been reached; and during suchnegotiations this Agreement shall remain in full force and effective provided,however, that if negotiations continue beyond the terminal date of thisAgreement, either party then terminate this Agreement upon ten (10) dayswritten notice to the other party.

 

41

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| Appendix “A”                  |   |
|-----------------------------------------|--------|
| Rates  of Pay Effective                 |   |   |   |   |   |   |   | 8/10/2002 |   |
| Employees Hired Before  August 10, 2002 |   |   |   |   |   |   |   |   |   |
|                                    |   |   |   |   |   |   |   |   |   |
| **Labor  Position**                     |   | **Training  Level 1** |   | **Training  Level 2** |   | **Training  Level 3** |   | **Training  Level 4** | ** ** |
|                                    |   |   |   |   |   |   |   |   |   |
| Assembly LG 1                           |   |   |   |   |   | 12.82 |   | 12.97 |   |
| Inspection LG 2                         |   |   |   | 12.85 |   | 12.95 |   | 13.10 |   |
| Shift  Helper/Sorter  LG 3         |   | 12.96 |   | 13.06 |   | 13.16 |   | 13.31 |   |
| Shipping/Receiving  LG 4           |   | 13.07 |   | 13.17 |   | 13.27 |   | 13.42 |   |
| Assembly Leader  LG 6              |   | 13.32 |   | 13.42 |   | 13.52 |   | 13.67 |   |
| Quality Assurance  LG 6            |   | 13.32 |   | 13.42 |   | 13.52 |   | 13.67 |   |
| Production  Attendant  LG6         |   | 13.32 |   | 13.42 |   | 13.52 |   | 13.67 |   |
| Quality Assurance  Lead  LG 8      |   | 17.42 |   | 17.55 |   | 17.68 |   | 17.87 |   |
| Shipping Lead  LG 8                |   | 17.42 |   | 17.55 |   | 17.68 |   | 17.87 |   |
| Cell Operator  LG 8                |   | 17.42 |   | 17.55 |   | 17.68 |   | 17.87 |   |
| Storeroom Lead  LG 9               |   | 17.51 |   | 17.64 |   | 17.77 |   | 17.97 |   |
| Maintenance  Apprentice  LG 10     |   | 17.63 |   | 17.76 |   | 17.89 |   | 18.08 |   |
| Maintenance  LG 10                 |   | 17.63 |   | 17.76 |   | 17.89 |   | 18.08 |   |
| Tool Room  LG 12                   |   | 17.84 |   | 17.97 |   | 18.10 |   | 18.29 |   |
| Skilled Trades Master  Mechanic         |   |   |   |   |   |   |   | 20.65 |   |
| Team Leader                             |   | 20.53 |   | 20.68 |   | 20.83 |   | 21.05 |   |

 

 
| Appendix “A”                  |   |
|-----------------------------------------|--------|
| Rates of Pay Effective                  |   |   |   |   |   |   |   | 8/10/2003 |   |
| Employees Hired Before  August 10, 2002 |   |   |   |   |   |   |   |   |   |
|                                    |   |   |   |   |   |   |   |   |   |
| **Labor  Position**                     |   | **Training  Level 1** |   | **Training  Level 2** |   | **Training  Level 3** |   | **Training  Level 4** | ** ** |
|                                    |   |   |   |   |   |   |   |   |   |
| Assembly LG 1                           |   |   |   |   |   | 13.17 |   | 13.32 |   |
| Inspection  LG 2                   |   |   |   | 13.20 |   | 13.30 |   | 13.45 |   |
| Shift  Helper/Sorter  LG 3         |   | 13.31 |   | 13.41 |   | 13.51 |   | 13.66 |   |
| Shipping/Receiving  LG 4           |   | 13.42 |   | 13.52 |   | 13.62 |   | 13.77 |   |
| Assembly Leader  LG 6              |   | 13.67 |   | 13.77 |   | 13.87 |   | 14.02 |   |
| Quality Assurance  LG 6            |   | 13.67 |   | 13.77 |   | 13.87 |   | 14.02 |   |
| Production  Attendant  LG 6        |   | 13.67 |   | 13.77 |   | 13.87 |   | 14.02 |   |
| Quality Assurance  Lead  LG 8      |   | 17.77 |   | 17.90 |   | 18.03 |   | 18.22 |   |
| Shipping Lead  LG 8                |   | 17.77 |   | 17.90 |   | 18.03 |   | 18.22 |   |
| Cell Operator  LG 8                |   | 17.77 |   | 17.90 |   | 18.03 |   | 18.22 |   |
| Storeroom Lead  LG 9               |   | 17.86 |   | 17.99 |   | 18.12 |   | 18.32 |   |
| Maintenance  Apprentice  LG 10     |   | 17.98 |   | 18.11 |   | 18.24 |   | 18.43 |   |
| Maintenance  LG 10                 |   | 17.98 |   | 18.11 |   | 18.24 |   | 18.43 |   |
| Tool Room  LG 12                   |   | 18.19 |   | 18.32 |   | 18.45 |   | 18.64 |   |
| Skilled Trades Master  Mechanic         |   |   |   |   |   |   |   | 21.00 |   |
| Team Leader                             |   | 20.88 |   | 21.03 |   | 21.18 |   | 21.40 |   |

 

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| Appendix “B”                 |   |
|----------------------------------------|--------|
| Rates of Pay Effective                 |   |   |   |   |   |   |   | 8/10/2002 |   |
| Employees Hired After  August 10, 2002 |   |   |   |   |   |   |   |   |   |
|                                   |   |   |   |   |   |   |   |   |   |
| **Labor  Position**                    |   | **Training  Level 1** |   | **Training  Level 2** |   | **Training  Level 3** |   | **Training  Level 4** |   |
|                                   |   |   |   |   |   |   |   |   |   |
| Assembly LG 1                          |   |   |   |   |   | 9.82 |   | 9.97 |   |
| Inspection LG 2                        |   |   |   | 9.85 |   | 9.95 |   | 10.10 |   |
| Shift Helper/Sorter  LG 3         |   | 9.96 |   | 10.06 |   | 10.16 |   | 10.31 |   |
| Shipping/Receiving  LG 4          |   | 10.07 |   | 10.17 |   | 10.27 |   | 10.42 |   |
| Assembly Leader  LG 6             |   | 10.32 |   | 10.42 |   | 10.52 |   | 10.67 |   |
| Quality Assurance  LG 6           |   | 10.32 |   | 10.42 |   | 10.52 |   | 10.67 |   |
| Production  Attendant  LG 6       |   | 10.32 |   | 10.42 |   | 10.52 |   | 10.67 |   |
| Quality Assurance  Lead  LG 8     |   | 13.52 |   | 13.65 |   | 13.78 |   | 13.97 |   |
| Shipping Lead  LG 8               |   | 13.52 |   | 13.65 |   | 13.78 |   | 13.97 |   |
| Cell Operator  LG 8               |   | 13.52 |   | 13.65 |   | 13.78 |   | 13.97 |   |
| Storeroom Lead  LG 9              |   | 13.61 |   | 13.74 |   | 13.87 |   | 14.07 |   |
| Maintenance  Apprentice  LG 10    |   | 13.73 |   | 13.86 |   | 13.99 |   | 14.18 |   |
| Maintenance  LG 10                |   | 13.73 |   | 13.86 |   | 13.99 |   | 14.18 |   |
| Tool Room  LG 12                  |   | 13.94 |   | 14.07 |   | 14.20 |   | 14.39 |   |
| Skilled Trades Master  Mechanic        |   |   |   |   |   |   |   | 17.65 |   |
| Team Leader                            |   |   |   |   |   |   |   |   |   |

 

 
| Appendix “B”                 |   |
|----------------------------------------|--------|
| Rates of Pay Effective                 |   |   |   |   |   |   |   | 8/10/2003 |   |
| Employees Hired After  August 10, 2002 |   |   |   |   |   |   |   |   |   |
|                                   |   |   |   |   |   |   |   |   |   |
| **Labor  Position**                    |   | **Training  Level 1** |   | **Training  Level 2** |   | **Training  Level 3** |   | **Training  Level 4** |   |
|                                   |   |   |   |   |   |   |   |   |   |
| Assembly LG 1                          |   |   |   |   |   | 10.17 |   | 10.32 |   |
| Inspection  LG 2                  |   |   |   | 10.20 |   | 10.30 |   | 10.45 |   |
| Shift  Helper/Sorter  LG 3        |   | 10.31 |   | 10.41 |   | 10.51 |   | 10.66 |   |
| Shipping/Receiving  LG 4          |   | 10.42 |   | 10.52 |   | 10.62 |   | 10.77 |   |
| Assembly Leader  LG 6             |   | 10.67 |   | 10.77 |   | 10.87 |   | 11.02 |   |
| Quality Assurance  LG 6           |   | 10.67 |   | 10.77 |   | 10.87 |   | 11.02 |   |
| Production  Attendant  LG 6       |   | 10.67 |   | 10.77 |   | 10.87 |   | 11.02 |   |
| Quality Assurance  Lead  LG 8     |   | 13.87 |   | 14.00 |   | 14.13 |   | 14.32 |   |
| Shipping Lead  LG 8               |   | 13.87 |   | 14.00 |   | 14.13 |   | 14.32 |   |
| Cell Operator  LG 8               |   | 13.87 |   | 14.00 |   | 14.13 |   | 14.32 |   |
| Storeroom Lead  LG 9              |   | 13.96 |   | 14.09 |   | 14.22 |   | 14.42 |   |
| Maintenance  Apprentice  LG 10    |   | 14.08 |   | 14.21 |   | 14.34 |   | 14.53 |   |
| Maintenance  LG 10                |   | 14.08 |   | 14.21 |   | 14.34 |   | 14.53 |   |
| Tool Room  LG 12                  |   | 14.29 |   | 14.42 |   | 14.55 |   | 14.74 |   |
| Skilled Trades Master  Mechanic        |   |   |   |   |   |   |   |   |   |
| Team Leader                            |   |   |   |   |   |   |   |   |   |

 

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**APPENDIX“D”**

** **

**STATEMENT OF COOPERATION**

** **

**ALCOHOL AND DRUG ABUSE**

 

Both the Company and Union express their collective determination todeal effectively and constructively with the problem of alcohol and drug abuseamong the Bargaining Unit employees. The Company and Union recognize that excessive use of alcohol or drugsby employees impairs their ability to function in an effective and safe mannerand contributes to increased absenteeism, tardiness, and potential safetyproblems.  Further, that use of eitheron the premises or reporting to work in an intoxicated state is in violation ofthe plant work and safety rules.  Boththe Company and Union agree that a joint effort by both parties will beextended to help Bargaining Unit employees afflicted and develop a system forearly identification and detection. Thereafter, arrangements will be made to refer afflicted employees forproper treatment and appropriate follow-ups.

 

Both the Company and Union agree that neither the Management nor Unionofficials are always able to provide the level of motivation required by anemployee affiliated by either alcohol or drug dependency.

 

As a result, both parties recognize that mutual cooperation isnecessary to encourage each afflicted employee to recognize his or her problemand seek professional treatment.  Andfurther to adopt the personal conviction to respond to treatment and tomaintain a resolve to avoid future alcohol and drug abuse after completing arecognized program of treatment.

 

Both the Company and Union agree to implement the program stated abovewith the Alcohol and Drug Abuse Committee, and will work cooperatively outsideof the grievance procedure of the contract on these problems.  The responsibilities of this Committee willbe as follows.

 

1.                                       Toassure any afflicted employee that discussions that take place will be held inthe strictest of confidence.

 

2.                                       To communicateto all employees that they may consult on a confidential basis with plantmedical personnel, or an outside qualified facility or agency, concerning theirproblem without fear or disciplinary action being based on such a discussion orprogram of treatment being initiated.

 

3.                                       To attend suchmeetings and seminars to evaluate and determine the appropriateness of programsor treatment offered by various community agencies, as well as establishprograms for educational and informational use by both Union members andManagement at a plant level.

 

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Both the Company and Union agree that nothing contained herein is to beconstrued or constitute any waiver of the Management’s right to maintain orinvoke discipline in such cases of misconduct which may result from, or beassociated with, the use of alcohol or drugs at Union reserves the right toexercise its rights to process any grievances concerning such matters as may bepermitted in accordance with the contract.

 

During the following initiation of a program of treatment, an afflictedemployee shall not receive nor expect any special privileges or exemptions fromall of the conditions required of employees of the Company.

 

Both the Company and Union will encourage employees with either of theproblems described above to voluntarily participate without the necessity ofdisciplinary action being taken.

 

When a leave of absence is necessary so that an afflicted employee mayundergo treatment for either alcoholism or drug dependency from a recognizedprogram, provided the employee has voluntarily submitted for such treatment,they will be granted such a leave of absence and will be eligible to receivethe benefits provided in accordance with the contract during said leave.  An employee may be granted only one suchleave under these provisions, except that an additional leave may be grantedonly with prior approval of the Alcohol and Drug Abuse Committee.

 

The Alcohol and Drug Abuse Committee shall consist of two (2) membersfrom the Management and two (2) members appointed by the Union and, should theperformance of their duties require that time be spent during regularlyscheduled working hours, the Union Committee Member will be paid his/herregular rate of pay up to a maximum of four (4) hours per month.  Any time spent at furthering the objectivesof this program or attending seminars offered by various community agencieswith respect to alcoholism or drug abuse outside the Committee Member’sregularly scheduled working hours shall not be compensated.

 

Prior to attending any outside community or professional programs whichwill necessitate the absence of the Union committee member during his/herregularly scheduled hours, permission to do so must be obtained from the HumanResources Manager.

 

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**8/10/02**

**Alcohol & DrugPolicy**

 

**POLICY STATEMENT**

It is the policy of our Company to create a drug-free, alcohol-freeworkplace in accordance with the statement of cooperation for Alcohol and DrugAbuse.  The use of controlled substancesand/or alcohol in the workplace or working under the influences of alcohol orcontrolled substances is inconsistent with the behavior expected of employees,subjects all employees and visitors to our facilities to unacceptable safetyrisks, and undermines the Company’s ability to operate effectively andefficiently.  The manufacture,distribution, possession, sale, or use of a controlled substance or alcohol inthe workplace or while engaged in company business off our premises is strictlyprohibited and will lead to disciplinary action up to and includingtermination.  Use of drugs or alcohol isalso prohibited during nonworking time to the extend that it impairs anemployee’s ability to perform on the job.

 

**PROCEDURE**

1.                                       Employees willbe required to submit to a drug/alcohol test under the following circumstances:

 

A.                                   Post AccidentTesting:  An employee shall be testedfor the use of controlled substances, as soon as possible, after a reportableaccident occurring while on Bremen Bearings, Inc. time or business or on anywork site.  A “reportable accident”means an accident resulting in property damage or resulting in any person, as aresult of the accident, receiving medical treatment away from the scene of theaccident.

 

B.                                     Whenever there isa reasonable cause to believe that an employee’s ability to perform his/her jobis impaired due to the use of drugs/alcohol, as indicated hereafter.

 

2.                                       Any employeewhose drug/alcohol test result is positive will be subject to three daysuspension pending investigation.

 

3.                                       Refusing to takea drug/alcohol test or any behavior intended to interfere with the validresults of that test will be considered as a positive test and a violation ofthis drug/alcohol policy warranting disciplinary action up to and including discharge.

 

4.                                       Afternotification of a positive test, the employee will have 24 hours to decide ifhe/she elects to have the same sample re-tested by a different laboratory athis/her own expense.

 

5.                                       Employees takingmedication must report such use to their immediate supervisor if the medicationis likely to interfere with the employee’s ability to function safely on thatjob.  The employee may be removed fromhis/her job or reassigned to another job until return to that position isdeemed appropriate.  The unauthorizeduse of prescription drugs that were prescribed for another person will beconsidered a violation of this drug policy.

 

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**REASONABLE CAUSETESTING**

 

The Company shall have reasonable cause for drug/alcohol testing if anemployee is having work performance problems or displaying behavior describedbelow (not all inclusive):

 

•                  Abnormallydilated or constricted pupils

•                  Glazed stare -redness of eyes

•                  Flushed face

•                  Changing orslurring of speech

•                  Constantsniffing

•                  Needle marks(Not applicable if a diabetic)

•                  Change inbehavior

•                  Forgetfulness orpoor concentration

•                  Constant fatigueor hyperactivity

•                  Smell of alcohol

•                  Difficultywalking

•                  Slowed reactions

 

Except for smell of alcohol and needle marks, an employee must show twoor more indications to establish probably cause.

 

If a supervisor observes an employee engaging in such behavioraffecting an employee’s job performance, the supervisor will advise the HumanResources Manager or designee and a union representative of the behavior.  The Human Resources representative and theunion representative will talk with and observe the employee to determine ifthe employee is likely to be under the influence of alcohol and/or drugs.

 

If the human resources representation and the union representationdetermine that it is likely the employee is under the influence of alcohol ordrugs, the employee will be required to submit to a breath-alcohol test and/orurine drug test.  If the employee testspositive or refuses to be tested, he/she will be subject to discipline, up toand including, discharge.  If the humanresources representative concludes that it is likely the employee is under theinfluence of alcohol and drugs and the union representation disagrees, theemployee will be given an opportunity to voluntarily submit to testing toexonerate him/herself.  If the employeedeclines, the Company may take such disciplinary action it deems appropriate upto and including discharge, subject to the employee’s right to grieve thedisciplinary action.

 

If an employee requests assistance prior to any demand that theemployee submit to post accident or probable cause drug/alcohol testing, theHuman Resources Manager or Administrator will arrange for assessment by anappropriate substance abuse professional (SAP).  If the SAP determines that treatment would be appropriate, theemployee will be offered an opportunity to participate in a drug/alcoholrehabilitation program with or without a leave of absence as deemed appropriateby the Alcohol and Drug Awareness Committee.

 

47

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**DEFINITIONS**

 

1.                                       **Alcohol use**meansthe consumption of any beverage, mixture, or preparation, including anymedication containing alcohol which, when consumed, causes an alcoholconcentration in excess of those established by the State of Indiana fordriving while intoxicated.

 

2.                                       **ControlledSubstance use** means a positive test at the established governmentstandards as defined by HCFA/DOT 49 CFR Part 40 for any of the followingsubstances.

 

•                  Marijuana

•                  Cocaine

•                  Opiates

•                  Amphetamines

•                  Phencyclidine(PCP)

 

48

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**6/28/99**

**Disciplinary ActionPolicy**

 

**POLICY STATEMENT**

It is the intent of management to promote safety, quality,productivity, and good human relations by following an improvement plan toprovide fair and equal treatment to all employees and to promote understandingof acceptable conduct and encourage corrective improvement in behavior where required.

 

**PROCEDURE**

This procedure is for disciplinary action related to work performanceand conduct-related problems.  Unionemployees have the right to union representation at all levels of discipline.

 

The progressive discipline process for absenteeism is separate fromthis system in accordance with the attendance policy.

 

The disciplinary action steps are initiated by the employee’ssupervisor and/or management representative and may be built on a combinationof different types of violations.

 

**Step 1. Verbal**

Counsel theemployee and issue a verbal warning. Attempt to determine and resolve the cause of the problem.  At the same time, state specifically thatthe employee is receiving a formal verbal warning.  Place a discipline document in the employee’s file describing theincident and the discussion.  Verbalwarnings will be active for a six (6) month period before becoming inactive.

 

**Step 2. Written**

Hold a meetingwith the employee, at which time you explain the nature of the offense and warnthe employee that any further misconduct could lead to a suspension, ordischarge.  Issue a written warning ofthe offense.  Written warnings will beactive for a twelve (12) month period before becoming inactive in employee’sfile.

 

**Step 3. Suspension**

Hold a meetingwith the employee, at which time you explain the nature of the offense and warnthe employee that any repetition could lead to discharge.  Issue a written document of the offense,including a reference to the prior offense(s). A one (1) to five (5) day suspension (without pay) may occur as part ofthis step and will be active for a twelve (12) month period before becominginactive.

 

**Step 4. Discharge**

A furtherinstance of misconduct within twelve (12) months of suspension may result indischarge.

 

49

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**IMMEDIATE SUSPENSIONAND/OR DISCHARGE**may take place at any time, withoutregard to the preceding steps, if the employee commits an offense for whichimmediate suspension and/or discharge is specified as a penalty or if, in thejudgment of Management, the employee’s continued presence would be contrary tothe best interests of the Company or any of its employees.  Immediate discharge may be justified forthese types of offenses:

 

•                  Theft of companyproperty or that of other employees

•                  Insubordinationor refusing to follow instructions

•                  Violation of theCompany’s Substance Abuse Policy

•                  Deliberatedestruction of company property

•                  Deliberateinjury to another person

•                  Violating aconfidence; unauthorized release of confidential information

•                  Violation of theCompany’s harassment policy

•                  Threateninganother employee with physical harm

•                  Deliberatelyendangering another employee

•                  Any otherviolation of the plant rules which, in the judgment of Management, seriouslythreaten the welfare of the Company or any employee

 

Distribution of documentation of disciplinary action steps to include:

Human Resources Manager- original to be placed in employee’s file

Employee

Union Office

 

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| **ATTENDANCE POLICY** |   | **BREMEN BEARINGS**   |
|-----------------------|--------|-----------------------|
| **8/10/02**           |   | **Effective 8/10/02** |

 

It is the Company’s philosophy that employees should be responsible fortheir attendance and absenteeism from work. Effective August 10, 2002, an absenteeism policy will become effectiveutilizing a point system that tracks both full and partial day absences on a12-month rolling calendar.

 

All absences will be documented; however, points will not be assessedfor the following:  Approved leave ofabsences (Medical, FMLA, Workers’ Compensation, Bereavement, Military, JuryDuty, Personal Leaves, Union), Snow Emergency Days, Disciplinary Suspensions,Holidays, Vacations, time when employee is sent home by the Company due to nowork, and if employee goes home because no work is available in his/herdepartment.

 

Points will be assessed as follows:

 
| • |   | One point (1)        |   | Each full day absent (more than 4 hours)                                                                                                                                  |
|--------|--------|----------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | One/half point (1/2) |   | Partial day absent (less than 4 hours  (tardy in excess of 6 minutes. leave/return, leave early)                                                                          |
| • |   | One/half point (1/2) |   | Failure to call in to supervisor or call in voice mail at least 60  minutes before beginning of shift or notify supervisor previously with a  written notification (form) |
| • |   | 8 points             |   | 3 consecutive days no call-no show                                                                                                                                        |

 

Each period of illness involving consecutive days will be assessed one(1) point, provided proper medical documentation is presented upon return towork.

 

The following corrective action will be taken in any 12 consecutivemonth period in which an employee has accumulated the following points forunexcused absences:

 
| 2 points |   | — |   | Verbal warning               |
|----------|--------|--------|--------|------------------------------|
| 4 points |   | — |   | Written warning              |
| 6 points |   | — |   | 3-day Suspension without pay |
| 8 points |   | — |   | Termination                  |

 

The Company will recognize and reward employees who have 6 months ofperfect attendance with a $100.00 payment.

 

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**Training Plan**

**6/28/99**

 

Training employees on jobs is the responsibility of the supervisor inthe department; however, the use of experienced operators as instructors iscritical to the success and effectiveness of the training process.  The Company will utilize the followingoutline to ensure effective training.

 

1.                                       Supervisorassigns the trainee to an operator who will review the following with theemployee:

 

•                  Work instructions

•                  Personalprotective equipment required

•                  Safety measures

•                  Quality andinspection requirements

•                  Forms andreports to be completed

•                  Equipmentoperation

•                  Productcharacteristics of good and bad quality

•                  Incentivecriteria (if applicable)

•                  Other informationand skills needed for success of training

 

2.                                       Thesupervisor and/or trainer will review training status with trainee a minimum ofonce every week to identify progression and areas that need special attention.

 

3.                                       Trainingcriteria will be established for each job through a coordinated effort ofsupervisors and operators.

 

4.                                       Atime-line will be identified and established to monitor normal training time.

 

A training committee will be established to establish training criteriaand time lines as well as training techniques and methods.  The committee will consist of 2 supervisors,2 operators, and a member of the bargaining committee.

 

Human Resources and the Plant Manager will monitor the program toensure completeness and effectiveness.

 

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It is agreed that the foregoing language represents the terms andconditions of a new labor agreement between the Bremen Bearings of RBC, USA,and Local 1368 of the U.A.W.

 

| For the Union |   | For the Company |
|---------------|--------|-----------------|

 
|   |   |   |   |   |
|--------|--------|--------|--------|--------|
|   |   |   |
|   |   |   |   |   |
|   |   |   |
|   |   |   |   |   |
|   |   |   |
|   |   |   |
|   |   |
|   |   |   |
|   |   |
|   |   |   |
|   |   |
|   |   |   |

Agreed to this 10th day of August, 2002.

 

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