44:~.;' - railgc.comConboy, Ellen Subject: FW: Consolidated Cost-Sharing Guidelines Attachments: Ken_CostShareLetter_10222009.pdf; CRLO Cost Share Instructions (10-16-09).pdf

M.

III

VIA EMAIL ONLY Chairpersons General Committees of Adjustment United Transportation Union Railroads in the United States

March 1, 2010

Re: Employee H&W Contribution -NRC/UTU Health & Welfare Plan and

Dear Sirs and Brothers:

Railroad Employees National Health & Welfare Plan (GA-23000)

www.utu.org

Over the past two (2) years the Cooperating Railway Labor Organizations sub-committee has had discussions with the NRLC in an effort to reach agreed-upon questions and answers illustrating the circumstances under which the railroads are required to make monthly payments to the above referenced health and welfare plans and under which the covered employees are required to make contributions.

While NRLC did not want to execute a formal question and answer document, they were willing to co-issue a document that would serve as "guidelines" on which the parties have agreement, but without prejudice to any position or rights that either party may now have, or had at any time in the past, regarding the interpretation or application of any collective bargaining agreement provision relating to any matter addressed by the guidelines.

Attached you will find a copy of any exchange of correspondence between CRLO Chairman R. A. Scardelletti and NRLC Chairman A. K. Gradia, along with the "Consolidated Cost-Sharing Guidelines With Examples Of Their Application".

The guidelines should serve to answer most questions you may receive from the membership regarding their required cost-sharing and please do not hesitate to contact this office should issues arise.

Attachment

cc: International Officers (via email) State Legislative Directors (via email) Field Supervisors (via email) Designated Legal Counsel (via email)

Fraternally yours,

/44:~.;' M. B. Futhey, Jr. International President

Goperating

RilWay

]jbOr Organizations

Health and Welfare Committee

3 Research Place Rockville, MD 20850 301-948-4910

R. A. Scardelletti Chairman

W. D. Pickett Vice Chairman

G. J. Francisco, Jr. Treasurer

American Train Dispatchers Association

Brotherhood of Locomotive Engineers & Trainmen Division IBT

Brotherhood of Maintenance of Way Employes Division IBT

Brotherhood of Railroad Signalmen

International Association of Machinists and Aerospace Workers

Sheet Metal Workers' International Association

International Brotherhood of Boilermakers & Blacksmiths

International Brotherhood of Electrical Workers

SEIUlNational Conference of Firemen & Oilers

Transport Workers Union

Transportation Communications Union

United Transportation Union

February 9, 2010 VIA FACSIMILE

TO: ALL CRLO Chiefs

Dear Sirs and Brothers:

This is in further reference to communications regarding the {(Consolidated Cost-Sharing Instructions" and my request for a formal agreement between the Cooperating Railway Labor Organizations and the National Railway Labor Conference.

In response to my August 7, 2009 request, A. Kenneth Gradia,Chairman National Railway Labor Conference provided a counter-proposal on October 22, 2009, wherein he stated that the cost-sharing instructions could be used as a guideline without the need of a formally signed document between the parties.

Attached is a copy of an email sent to the Labor Subcommittee members from former CRLO Administrator Nick Stewart, relaying the Carrier's counter-proposal. Subsequent to that email, one organization voiced some concern to Nick Stewart, to which he provided an appropriate response. Since that time, this office has not received any further communications from any other organization or subcommittee member.

As a result of no further comments, I will respond to Mr. Gradia's October 22, 2009 letter that we should bring this matter to a conclusion. In doing so, I will advise that the document represents the objective views of the matters noted therein. They are set forth without prejudice to any position or rights that either party may now have,orhad at any time in the past, regarding the interpretation or application of any collective bargaining agreement provision relating to any matter addressed by this guidance.

Attachment

In solidarity,

/~~. Robert A. Scardelletti CRLO Chairman

Conboy, Ellen

Subject: FW: Consolidated Cost-Sharing Guidelines Attachments: Ken_CostShareLetter_10222009.pdf; CRLO Cost Share Instructions (10-16-09).pdf

Importance: High

From: Stewart, Nick Sent: Friday, October 23, 2009 12: 15 PM To: Bill Bohne ([email protected]); Bill Hildenbrand; Cook, Dan; Dan Hamilton ([email protected]); Don Griffin; Frank May; Fred Fink; Jeff Weisbarth; John Slatery; Leo McCann ([email protected]); Michael Williams ([email protected]); Oathout, Russell; Thomas Fisher; Walt Barrows Subject: FW: Consolidated Cost-Sharing Guidelines Importance: High

Greetings:

At long last, we have a response from the NRLC regarding the consolidated cost-sharing instructions.

As you will see from NRLC Chairman Ken Gradia's cover letter, the NRLC does not want to execute the

instructions in the form of an ([agreement" for reasons he explains therein. However, the NRLC is willing to co

issue the document as {{Consolidated Cost Sharing Guidelines/' albeit with a disclaimer.

Ellen and I spent the morning going over the NRLC document word by word, and we did not find any material

changes from our original proposal. In some instances, the intent of our language has been condensed, but

the CRLO scenarios and interpretations are all there as we presented them. In short, we found no surprises.

While the NRLC's response is not exactly what we asked for, suffice it to say that we are far better off now

than we were two years ago when we started this project. We now have a working set of guidelines that the

railroads have agreed to, and which we can distribute as we see fit. For that, I want to congratulate the

committee that has worked so hard on this for so many months, both individually and through meetings and

conference calls. I also want to thank CRLO Chairman Scardelletti for his aggressive pursuit of this matter with the Chairman of the NRLC.

In solidarity,

Nick Stewart

CRLO Administrator

1

NATIONAL RAILWAY LABOR CONFERENCE 1901 L STREET, N.W., WASHINGTON, D.C. 20036/ AREA CODE: 202-862-7200 FAX: 202-467-5892

JEFFREY F. ROGERS Vice Chairman

Robert A. Scardelletti CRLO Chairman 3 Research Place Rockville, MD 20850

Dear Mr. Scardelletti:

A. KENNETH GRADIA Chairman

JOANNA L. MOORHEAD General Counsel

JOHNF. HENNECKE Director of Labor Relations

October 22,2009

By letter dated August 7, 2009, you sent me a paper entitled "Consolidated Cost-Sharing Instructions". That paper was essentially a CRLO revision of the response that we made earlier in the year of a Question and Answer document that Mr. Stewart of your office sent to me setting forth the CRLO's views as to when a carrier contribution to the Railroad Employees National Health and Welfare Plan and, accordingly, an employee cost-sharing contribution, was required.

We have now completed our review of that paper and enclose with this letter a revised version of that document for your consideration. We would be happy to discuss any of the revisions we have proposed with such CRLO representatives as you may designate.

In your August 7 letter, you proposed that the carriers and the labor organizations agree to formally and jointly adopt whatever text emerges from our exchange once completed. We think a different approach would better and more promptly effectuate what I believe to be our mutual objective-the amelioration of the confusion and uncertainty to which you refer in the penultimate paragraph of your August 7 letter.

As you will see from the title of the enclosed revision, we think the principles and examples set forth in the document should comprise a set of "Guidelines" for carrier use and guidance that would help achieve that goal on a going-forward basis. As we noted in our response to Mr. Stewart last March, the positions articulated in the revised document represent current carrier views regarding the matters addressed therein. They are set forth without prejudice to any position or rights that any carrier may now have, or had at any time in the past,

-2 -

regarding the interpretation or application of any collective bargaining agreement provision relating to any matter addressed by this guidance. A process requiring "formal" and 'joint" adoption of the document would, in our view, materially delay and complicate our efforts to address the problems you have identified with no assurance of mutual resolution.

We look forward to hearing your views on our revision.

Sincerely yours,

A. Kenneth Gradia

Enclosure

CONSOLIDATED COST-SHARING GUIDELINES WITH EXAMPLES OF THEIR APPLICATION

Employee cost-sharing is required for each month that a carrier is required to make a

contribution to the Railroad Employees National Health and Welfare Plan (the "Plan")

on the employee's behalf for foreign-to-occupation health benefit coverage for

himself/herself and/or his/her dependents.

General Principles

1. A carrier is required to make a Plan contribution regarding an employee (thus

triggering an employee cost-sharing contribution) for each calendar month

immediately following a calendar month in which the employee rendered the

Requisite Amount of Compensated Service or received the Requisite Amount of

Vacation Payor a combination of both. A carrier is also required to make a

Plan contribution when the "Opportunity Rule" applies and an employee is

treated as if he/she had rendered the Requisite Amount of Compensated

Service. See General Principle 5.

2. The Requisite Amount of Compensated Service is compensated service

rendered for an aggregate of at least seven calendar days during a calendar

month if the employee is covered under the Plan pursuant to a collective

bargaining agreement that provides for such a "seven-day" rule; otherwise, the

Requisite Amount of Compensated Service is compensated service rendered

for at least one day during the month.

3. The Requisite Amount of Vacation Pay is vacation pay received for an

aggregate of at least seven calendar days during a calendar month if the

employee is covered under the Plan pursuant to a collective bargaining

agreement that provides for such a "seven-day" rule; otherwise, the Requisite

Amount of Vacation Pay is vacation pay received for at least one day during the

month. This General Principle is subject to the following exceptions:

a) Vacation pay received by a furloughed employee after the start of his/her

furlough will not be considered vacation pay for purposes of determining

Plan coverage or required carrier or employee cost-sharing contributions.

b) Vacation pay received by an employee after termination of his/her

employment relationship (i.e., resignation, dismissal and retirement) will

not be considered vacation pay for purposes of determining Plan

coverage or required carrier or employee cost-sharing contributions.

c) Vacation pay received by an employee while covered by the Plan as a

disabled employee will be considered vacation pay for purposes of

determining Plan coverage but not for purposes of determining carrier or

employee cost-sharing contributions.

2

4. Where the seven-day rule applies, an employee continues to be covered by the

Plan during any calendar month by virtue of rendering compensated service or

receiving vacation pay in the immediately preceding month only if he/she

rendered compensated service on, or received vacation pay for, an aggregate

of at least seven calendar days during such preceding month.

5. If an employee returns to work from furlough, suspension, dismissal or disability

(including pregnancy), or commences work as a new hire, at a time during a

month when there is not an opportunity to render compensated service on at

least seven calendar days during that month, the employee will be deemed to

have satisfied the seven-day rule, provided that he/she is available to work, or

actually works, every available work opportunity during that month. Carriers

refer to this principle as the "Opportunity Rule." It does not apply to an

employee who will be covered by the Plan during the immediately following

month under any of the Plan's extended coverage provisions, such as furlough,

suspension, dismissal, disability, etc.

6. For all unions that have agreed to the seven-day rule, except for the BLET and

the UTU (including Yardmasters), where the regular work day consists of more

than eight hours, each such day actually worked or for which vacation pay is

received is treated as one and a fraction days, i.e., a regular assignment of ten

hours is treated as 1.25 calendar days for purposes of determining whether or

not the seven-day rule has been satisfied.

3

7. Compensated service includes time actually worked and time that the carrier

has customarily treated as if it were time actually worked. In addition,

compensated service includes days of FMLA leave unless the employee is

covered by the Plan during the immediately following month for any reason

other than rendering the Requisite Amount of Compensated Service or

receiving the Requisite Amount of Vacation Pay, or a combination of both,

during the current month (i.e., coverage during the immediately following month

by reason of furlough, dismissal, suspension, etc.).

8. Where an employee has coverage in the immediately succeeding month by

reason of any of the extended coverage provisions of the Plan, no carrier or

employee cost-sharing contributions are required for that month unless the

employee rendered the Requisite Amount of Compensated Service or received

the Requisite Amount of Vacation Pay, or a combination of both, in the current

month or experienced a situation where the "Opportunity Rule" (see General

Principle 5) was applicable for the current month.

Side Letters of the 1996 National Agreements confirm understandings with respect to

application of the seven-calendar-day-per-month requirement for benefit coverage and

also impact when coverage is established.

Assumptions

The specific rules set forth below incorporate the following assumptions:

a) Newly hired employees are not subject to any waiting period.

4

b) References to "vacation pay," "vacation" and the like mean days

for which the employee received vacation pay.

c) All employees are subject to the seven-day rule.

d) Unless specified otherwise, all vacation pay was received prior to

furlough, retirement, dismissal or disability, as the case may be.

e) In cases where the employee returns to work from furlough,

suspension, dismissal or di"sability when less than seven calendar

days remain in the month, the employee is available to work, or

actually works, every available opportunity during that month.

f) All disabled employees have provided satisfactory proof of

disability_ Unless specified otherwise, disabled employees are

continuously disabled and have retained their employment

relationship.

g) In cases where a disabled employee received vacation pay after

becoming disabled, the vacation pay was received in the same

year as the disability began.

5

Examples

1. New Hire

a. Employee hires out January 27 and works all the remaining days in

January - coverage begins February 1, and cost-sharing and carrier

contributions are required for February because the employee was

treated as if he/she rendered the Requisite Amount of Compensated

Service in January pursuant to the "Opportunity Rule." See General

Principle 5.

b. Employee hires out January 3 and works at least seven days in January

- coverage begins February 1. Cost-sharing and carrier contributions

are required for February as the employee rendered the Requisite

Amount of Compensated Service in January.

2. Furloughed Employee

a. Employee is furloughed January 15 after working seven days in January

and remains furloughed through May - has coverage through May.

Cost-sharing and carrier contributions are required for February as the

employee rendered the Requisite Amount of Compensated Service in

January. No cost-sharing and carrier contributions are required for

March-May.

b. Employee is furloughed January 5 after working three days in January

and remains furloughed through May - has coverage through May. No

6

cost-sharing and carrier contributions are required for February, since in

January employee did not render the Requisite Amount of Compensated

Service or receive the Requisite Amount of Vacation Payor a

combination of both. See General Principle 8. No cost-sharing and

carrier contributions are required for March-May.

c. (i) Employee is furloughed January 15 after working seven days in

January - would (if he/she remained furloughed) have coverage through

May. However, employee returns to work on March 29 (prior to end of

4th month) and works all available work opportunities through the end of

the month. Cost-sharing and carrier contributions are required for

February as the employee rendered the Requisite Amount of

Compensated Service in January. Employee will have coverage in

March as a result of the furlough until his/her furlough ends and, since

he/she rendered compensated service by working in March, for the rest

of that month. The employee will also have coverage in April pursuant to

the "Opportunity Rule. 1T See General Principle 5 and Assumption e.

(ii) In Example (i) above, no cost-sharing or carrier contributions are

required for March as employee did not render the Requisite Amount of

Compensated Service or receive the Requisite Amount of Vacation Pay

or a combination of both in February. The employee will have coverage

in April, and carrier and employee cost-sharing contributions are required

for April, because the employee was treated as if he/she rendered the

7

Requisite Amount of Compensated Service in March pursuant to the

"Opportunity Rule. n See General Principle 5 and Assumption e.

d. (i) Employee is furloughed January 5 after working three days in

January - would (if he/she remained furloughed) have coverage through



the month. The employee will have coverage in April, and carrier and

employee cost-sharing contributions are required for April, because the

employee was treated as if he/she rendered the Requisite Amount of

Compensated Service pursuant to the "Opportunity Rule. n See General

Principle 5 and Assumption e.

e.

(ii) In Example (i) above, cost-sharing and carrier contributions are

not required for February or March as employee did not render the

Requisite Amount of Compensated Service or receive the Requisite

Amount of Vacation Payor a combination of both in January or February,

respectively.

(i) Employee is furloughed January 15 after working seven days in

January and, because he/she remains furloughed through May, has

coverage through that month. The employee returns to work June 15

(after end of 4th month) and renders the Requisite Amount of

Compensated Service in June. Coverage will begin again July 1. The

employee will not have coverage in June.

8

f.


required for February as employee rendered the Requisite Amount of

Compensated Service in January. No cost-sharing and carrier

contributions are required for March-June.

(iii) In Example (i) above, cost-sharing and carrier contributions are

required for July as the employee rendered the Requisite Amount of

Compensated Service in June.

(i) Employee is furloughed January 15 after working seven days in

January and, because he/she remains furloughed through May, has

coverage through that month. The employee returns to work June 28

(after end of 4th month) and works all available work opportunities

through the end of the month. Coverage for the employee will begin July

1 because he/she was treated as if he/she rendered the Requisite

Amount of Compensated Service in June pursuant to the "Opportunity

Rule." See General Principles 5 & 8 and Assumption e. The employee

will not have coverage in June.


required for February as the employee rendered the Requisite Amount of




required for July because the employee was treated as if he/she

9

rendered the Requisite Amount of Compensated Service in June

pursuant to the "Opportunity Rule." See General Principles 5 & 8 and

Assumption e.

g. (i) If during any period of furlough an employee renders at least one

day of compensated service, the furlough period will be extended four (4)

months from the month in which the employee rendered such

compensated service. For example, an employee last works January 15

after working seven days in January, coverage would (if he/she remains

furloughed) continue through May. However, the employee returns to

work in March and renders one day of compensated service and is again

furloughed and remains furloughed through July, coverage would

continue through July.




contributions are required for March-July. See General Principles 5 & 8.

h. (i) Employee works seven days in January and receives one day of

vacation pay in February. Employee is then furloughed later in February

and remains furloughed. The employee would have coverage through

June.

10

i.



Compensated Service in January.

(iii) In Example (i) above, no cost-sharing and carrier contributions are

required for March-June. See General Principles 5 & 8.

(i) Employee is furloughed December 24 after working 20 days in

December and remains furloughed. The employee would have coverage

through April. In January the employee is paid for the January 1 holiday.

The receipt of holiday pay in January does not count as compensated

service and therefore, does not extend coverage. The employee's

coverage would still terminate in April. See General Principles 5 & 8.


required for January as the employee rendered the Requisite Amount of

Compensated Service in December. Cost-sharing and carrier

contributions are not required for February. See General Principles 5 &

8.

3. Suspended Employee

a. Employee is suspended January 15 after working seven days in January

and remains suspended through May - has coverage through May.



11


March-May.

b. Employee is suspended January 5 after working three days in January

and remains suspended through May - has coverage through May. No

cost-sharing and carrier contributions are required for February, since in

January employee did not render the Requisite Amount of Compensated


combination of both. See General Principles 5 & 8. No cost-sharing and


c. (i) Employee is suspended January 15 after working seven days in

January - would (if he/she remained suspended) have coverage through



the month. The employee will have coverage in March until his/her

suspension ends and, since he/she rendered compensated service by

working in March, for the rest of that month.




contributions are required for March as no days were worked in

February.

12

d.

Carrier and employee cost-sharing contributions are required for April

because the employee was treated as if he/she rendered the Requisite

Amount of Compensated Service in March pursuant to the "Opportunity

Rule." See General Principles 5 & 8 and Assumption e.

(i) Employee is suspended January 5 after working three days in


May. However, the employee returns to work on March 15 (prior to end

of 4th month) and works at least seven days in March. The employee will

have coverage in March until his/her suspension ends and, since he/she

rendered compensated service by working in March, for the rest of that

month.


not required for February as in January employee did not render the


Amount of Vacation Payor a combination of both. No cost-sharing or

carrier contributions are required for March as no days were worked in

February. Cost-sharing and carrier contributions are required for April as

seven days were worked in March. See General Principles 5 & 8.

e. (i) Employee is suspended January 15 after working seven days in


May. However, the employee returns to work June 28 (after end of 4th

month) and works all available work opportunities through the end of the

13

f.

month. The employee will have coverage again beginning July 1

because he/she was treated as if he/she rendered the Requisite Amount

of Compensated Service in June pursuant to the "Opportunity Rule."

See General Principles 5 & 8 and Assumption e. The employee will not

have coverage in June.









Assumption e.

(i) Employee is suspended on January 15 - would (if he/she remains

suspended) have coverage through May. Employee receives two days

of vacation in April and remains suspended. The receipt of such

vacation pay extends coverage through August.

(ii) In Example (I) above, cost-sharing and carrier contributions are

required for February if in January the employee rendered the Requisite

Amount of Compensated Service or received the Requisite Amount of

Vacation Pay, or a combination of both. If in January the employee did

14

not render the Requisite Amount of Compensated Service or receive the

Requisite Amount of Vacation Pay, or a combination of both, no cost

sharing and carrier contributions are required for February. See General

Principles 5 & 8.

(iii) In Example (i) above, the receipt of any vacation in April triggers

an extension of benefits through August. No cost-sharing or carrier

contributions are required for May because two days of vacation does

not constitute the Requisite Amount of Vacation Pay. See General

Principles 5 & 8.

g. If an employee is awarded full back pay for all time lost as a result of

suspension, coverage will be provided as if he/she had not been

suspended. All cost-sharing and carrier contributions would then be

required for retroactive months on the same basis as would have been

required of an active employee.

4. Dismissed Employee

a. Employee is dismissed January 15 after working seven days in January

- would (if he/she remains dismissed) have coverage through May.




March-May.

15

b. Employee is dismissed January 5 after working three days in January -

would (if he/she remains dismissed) have coverage through May. No

cost-sharing and carrier contribution are required for February, since in

January, employee did not render the Requisite Amount of Compensated


combination of both. See General Principles 5 & 8. No cost-sharing and


c. (i) Employee is dismissed January 15 after working seven days in

January - would (if he/she remained dismissed) have coverage through


of 4th month) and works all available work opportunities through the end

of the month. The employee will have coverage in March until his/her

dismissal ends and, since he/she rendered compensated service by

working in March, for the rest of that month.


required for February as seven days worked in January. No cost-sharing

and carrier contributions are required for March as no days were worked

in February. Cost-sharing and carrier contributions are required for April

because the employee was treated as if he/she rendered the Requisite

Amount of Compensated Service in March pursuant to the "Opportunity

Rule." See General Principles 5 & 8 and Assumption e.

16

d. (i) Employee is dismissed January 5 after working three days in



of 4th month) and works at least seven days in March. The employee will

have coverage in March until his/her dismissal ends and, since he/she

rendered compensated service by working in March, for the rest of that

month.

(ii) In Example (i) above, no cost-sharing and carrier contributions are

required for February or March, since the employee did not render the


Amount of Vacation Payor a combination of both, in January or

February. Cost-sharing and carrier contributions are required for April as


March. See General Principles 5 & 8.

e. (i) Employee is dismissed January 15 after working seven days in


May. However, the employee returns to work June 28 (after end of 4th

month) and works all available work opportunities through the end of the

month. Coverage for the employee will begin July 1 because he/she was

treated as if he/she rendered the Requisite Amount of Compensated

Service in June pursuant to the "Opportunity Rule." See General

Principles 5 & 8 and Assumption e. The employee will not have coverage

in June.

17




contribution are required for March-June.





Assumption e.

f. (i) Employee works seven days in January, receives one day of

vacation on February 1 and is then dismissed on February 2 - would (if

he/she remains dismissed) have coverage through June.



Compensated Service in January.

(iii) In Example (i) above, no cost-sharing and carrier contributions are

required for March as the employee did not render the Requisite Amount

of Compensated Service or receive the Requisite Amount of Vacation

Payor a combination of both in February. No cost-sharing or carrier

contributions are required for April-June. See General Principles 5 & 8.

18

g. (i) Employee is dismissed on January 15 after working seven days in

January - would (if he/she remains dismissed) have coverage through

May. Employee, while covered under the Plan as a dismissed

employee r receives two weeks of vacation pay in March.



Compensated Service in January. See General Principles 5 & 8.

(iii) In Example (i) above, vacation paid after the dismissal date is not

considered vacation pay for purposes of determining Plan coverage or

required employee cost-sharing and carrier contributions and, therefore,

does not extend the period of coverage beyond Mayor trigger a cost

sharing or carrier contribution for April. See General Principle 3(b).

h. If an employee is awarded full back pay for all time lost as a result of

dismissal, coverage will be provided as if he/she had not been

dismissed. All cost-sharing and carrier contributions would then be

required for retroactive months on the same basis as would have been

required of an active employee.

5. Disabled Employee

a. (i) Employee becomes disabled January 15 after working seven days

in January - would (if he/she remains continuously disabled) have

coverage for employee benefits through the end of the 2nd calendar year

19

b.

c.

following the year in which the employee last rendered compensated

service or received vacation pay.




contributions are required for the remaining months of coverage for

employee benefits by reason of disability.

(i) Employee becomes disabled January 5 after working three days




service or received vacation pay.

(ii) In Example (i) above, no cost-sharing and carrier contributions are

required for February as in January the employee did not render the


Amount of Vacation Pay, or a combination of both. No cost-sharing and

carrier contributions are required for the remaining months of coverage

for employee benefits by reason of disability.

(i) Employee becomes disabled January 15 after working seven days




20

d.

service or received vacation pay. Cost-sharing and carrier contributions

are required for February.

(ii) In Example (i) above, however, employee returns to work before

the end of the 2nd calendar year. Coverage by reason of disability will

continue until the end of the month in which the employee's disability

ends. Coverage as a returning employee will begin on the first day of the

next month, and cost-sharing and carrier contributions will be required for

that month, if the employee rendered the Requisite Amount of

Compensated Service, or the "Opportunity Rule" applied, in the month in

which he/she returned to work. See General Principles 5 & 8 and

Assumption e. No cost-sharing or carrier contribution is required for the

month in which the employee returns to work since he/she did not render

the Requisite Amount of Compensated Service or receive the Requisite

Amount of Vacation Pay, or a combination of both, in the prior month.

For example, employee returns and works seven days in June - he/she

has coverage in July. No carrier or cost-sharing contributions are

required for June as no days were worked in May, but carrier and cost

sharing contributions are required for July since the employee rendered

the Requisite Amount of Compensated Service in June. See General

Principal 5.




21

e.


service or received vacation pay. Cost-sharing and carrier contributions

are not required for February as in January the employee did not render

the Requisite Amount of Compensated Service or receive the Requisite

Amount of Vacation Pay, or a combination of both. See General

Principles 5 & 8.

(ii) In Example (i) above, however, employee returns to work before

the end of the 2nd calendar year. Coverage by reason of disability will

continue until the end of the month in which the employee's disability

ends. Coverage as a returning employee will begin on the first day of the

next month, and carrier and cost-sharing contribution will be required for

that month, if the employee rendered the Requisite Amount of

Compensated Service, or the "Opportunity Rule" applied, in the month in

which he/she returned to work. For example, employee returns on

June 29, coverage begins July 1, no cost-sharing or carrier contribution

is required for June as no days worked in May but cost-sharing and

carrier contributions are required for July because the employee was

treated as if he/she rendered the Requested Amount of Compensated

Service in June pursuant to the "Opportunity Rule." See General

Principles 5 & 8 and Assumption e.




22


service or received vacation pay. Employee receives one day of

vacation in immediately subsequent year.

Oi) In Example 0) above, cost-sharing and carrier contributions are

not required for February as in January the employee did not render the


Amount of Vacation Pay, or a combination of both. No cost-sharing or

carrier contributions are required for remaining period of coverage for

employee benefits by reason of disability. Receipt of vacation thereafter

will not require a cost-sharing or carrier contribution but coverage will be

extended from the receipt of any vacation. Coverage will extend· through

the end of the second calendar year following the year in which the

employee received vacation pay. See General Principle 3( c) and

Assumption f.

6. Retired Employees

a. Employee retires January 5 after working three days in January,

coverage is provided until the end of February. Cost-sharing and carrier

contributions are not required for February as in January the employee

did not render the Requisite Amount of Compensated Service or receive

the Requisite Amount of Vacation Pay, or a combination of both.

b. Employee retires January 15 after working seven days in January,

coverage is provided until the end of February. Cost-sharing and carrier

23

contributions are required for February as employee rendered the

Requisite Amount of Compensated Service worked in January.

7. Leave of Absence

a. Employee takes leave of absence January 5. Coverage would be

provided in January, and cost-sharing and carrier contributions would be

required for January, only if the employee rendered the Requisite

Amount of Compensated Service or received the Requisite Amount of

Vacation Pay, or a combination of both, in December. In such a case,

coverage would terminate on January 31. No coverage is provided to

the employee in February as the employee did not render the Requisite

Amount of Compensated Service or receive the Requisite Amount of

Vacation Pay, or a combination of both, in January. No cost-sharing or

carrier contributions are required for February.

b. Employee takes leave of absence January 15 after working seven days

in January. Coverage is provided until the end of the month following the

month in which the employee last rendered the Requisite Amount of

Compensated Service or received the Requisite Amount of Vacation

Payor a combination of both. Coverage is provided to the employee

through February as the employee rendered the Requisite Amount of

Compensated Service in January. Cost-sharing and carrier contributions

are required for February.

8. Family or Medical Leave (FMLA)

24

Any day of FMLA leave taken in a month immediately preceding a month during

which the employee has Plan coverage by virtue of any of the extended

coverage provisions of the Plan (usually disability where the employee takes

FMLA for his/her own disability) is not counted as a day of compensated

service. All other days of FMLA leave are counted as days of compensated

service. Accordingly, if the employee has rendered the Requisite Amount of

Compensated Service or received the Requisite Amount of Vacation Pay, or a

combination of both, during June (including days of FMLA leave where the

employee does not have coverage in July under any of the Plan's extended

coverage provisions), carrier and employee cost-sharing contributions would be

required, and the employee would be covered, in July. If the employee has

coverage in July by reason of a Plan extended coverage provision, (e.g.,

disability), FMLA leave in June is not counted as compensated service. Thus,

unless the employee has rendered the Requisite Amount of Compensated

Service (not including his/her FMLA leave) or received the Requisite Amount of

Vacation Pay, or a combination of both, in June, no cost-sharing or carrier

contributions are required in July.

g. Death of Employee

Cost-sharing and carrier contributions are not required in the month following

the employee's death unless the employee rendered the Requisite Amount of

Compensated Service or received the Requisite Amount of Vacation Pay, or a

combination of both, in the month in which he/she died.

25

10. Dismissed or Retired Employee

In cases of dismissal or retirement where there's an insufficient amount in the

employee's next paycheck to pay any cost-sharing contribution then due from

the employee, the excess of the unpaid employee contribution over the amount

of the employee's pay available to satisfy his/her contribution obligation will be

deemed in arrears and deducted from compensation of any sort subsequently

payable to the employee. No other efforts are made to collect the unpaid

employee contribution.

G:\Social Services\consolidated cost sharing contribution interpretations only.doc

4/30109

26

Documents

44:~.;' - railgc.comConboy, Ellen Subject: FW: Consolidated Cost-Sharing Guidelines Attachments: Ken_CostShareLetter_10222009.pdf; CRLO Cost Share Instructions (10-16-09).pdf