MEMORANDUM OF AGREEMENT BETWEEN AMERICAN WATER AND Local 640, UTILITY WORKERS UNION OF AMERICA, AFL-CIO Local 640, Utility Workers Union of America AFL-CIO ("Union") and American Water ("Company") collectively referred to as "Parties" mutually agree that the items identified in this Memorandum of Agreement need to be addressed. This memorandum supersedes any previous memorandum between the parties. To this end the parties have agreed to the following interim process: Continuous Service List For purposes of this Agreement, an employee's seniority date is defined as the date the bargaining unit employee began continuous service with American Water. A list of employees in the bargaining unit with their date of hire shall be posted on the bulletin board with a copy sent to the Union. The Company will furnish to the Union and steward annually, on the anniversary date of this Agreement, a revised Continuous Service List. When two or more employees have identical seniority dates, preference shall be determined by lottery and evidenced on the length of service list. The Continuous Service List will be updated monthly. Shift Bidding Shift Bids in Call Handling will generally begin the first week of each quarter to assure that shift preferences are in accordance with the Continuous Service List. However, under no circumstances will the company be required to begin a shift bid within 45 days of the close of the previous shift bid. The Company reserves the right to hold Shift Bids more frequently, if there is a business need. Shift Bids in all other areas of the Customer Service Center (i.e. all except Call Handling) will be scheduled as deem appropriate by the Company or are necessary to adjust for length of continuous service. The Company agrees to notify the Union leadership in advance of a general announcement. Bids will be put into Auctions based on work groups (i.e. Call Handling, Billing, Collections, Special Accounts, Coaches, Technical Coordinators, Time Critical, there may be some additional groups) - all employees will bid based on their tour preference Auctions will be open in length of continuous service All assignments will be made to qualified employees based on the continuous length of service of those employees who placed bids Employees will have at least one (1) week notice prior to the effective date of their new schedule Available schedules for upcoming bids will be posted Two (2) weeks in advance on the bulletin board in the break area, however for the upcoming Shift Bid, due to the Business necessity, that process will being on October 17. If an employee is not available during bidding, due to ATO/STD/Leave or any other reason, they should leave their preferences with their Team supervisor Request must be in writing with the employee's signature and dated If the individual has been out for at least three (3) weeks prior to the shift bid, the company will make a reasonable effort to contact the employee to assure they are aware of the shift bid. Any employee absent on the day of the scheduled Shift Bid is responsible for making their preferences known to their supervisor Any employee who does not provide a bid, or refused to place a bid, will be placed at the bottom of the list and will receive whatever schedule is available at that time. The employee will remain in that schedule until the next Shift Bid. Should a Shift Bid take longer than a single day, the company will provide employees who have not yet bid with a list of all available schedules. Seating assignments will be based on the schedules received The Parties mutually acknowledge that the scope of future shift bids and the shift bid process are subject to change. The parties agree that they will meet and discuss any changes to the scope and/or the process before any changes are made. The Parties further agree that this Agreement shall remain in effect unless and until the parties decide to change it at which time the modified process shall be incorporated into the Collective Bargaining Agreement in effect at that time. Labor Relations Training The parties agree that within 90 days of the ratification of the Collective Bargainin Agreement, that the company will sponsor Labor Relations Training for Supervisors, Managers and Union Representatives of Local 640. The program will be conduct by a third party mututally acceptable to the Union and Management. Disciplinary Audit The Company agrees that within 90 days of the ratification of the Collective Bargaining Agreement, it will complete an audit of all disciplinary actions to the date of this agreement. If the Company believes that the underlying records does not support the disciplinary action taken, the employee's record will be expunged of any record of that discipline. The Company further agrees that it will share the findings of this audit. If there are any items that remain unresolved after the review with the Union, the parties will review the underlying documentation. Classification Review The Company agrees that within 30 days of the ratification of the Collective Bargaining Agreement, it will compete a review of the classification of all bargaining unit positions to assure that it is consistent with Attachment 'A'. Any individual whose position is not properly classified in accordance with Attachment 'A". will be reclassified appropriately. Any individual who is below the minimum of the new grade will be adjusted to the minimum of the new grade prior to the application of any wage increase indentified in the Collective Bargaining Agreement. Attendance The parties acknowledge that attendance rates are blow and acceptable level. The parties agree to meet and discuss ways to address this serious problem. It is understood that the signatures appearing below of representatives of the American Water and the Utility Workers Union of America, AFL-CIO, constitute acceptance of this Agreement and all clauses within it, by the Parties hereto. This Memorandum of Agreement is executed in multiple originals. AMERICAN WATER UTILITY WORKERS UNION OF AMERICAN, A.F.L.-C.I.O.