ARTICLE VIII - PRODUCTIVITY FUND

Section 1.  (a) Company Contribution. For each trip that a yard tour of duty or road freight service crew is operated with a conductor or foreman and one brakeman or yard helper (including new business and non-revenue runs) , the Company will pay into the Employes' Productivity Fund the sum of $48.25. This payment will be made on a pay period cash basis for the sole and exclusive benefit of the eligible protected road freight train and yard service employes and is to be considered as an account or trust of and for the protected employes as sharing in Productivity Savings. (Intpns. Pg. 21-22)

(b) Productivity Accounts. Separate employe Productivity Accounts shall be maintained for each defined district as determined by the respective General Committees of Adjustment and Director of Labor Relations. At the end of each year, each protected employe performing service in that particular district will share in the division of the Employes' Productivity Fund, according to the number of yard tour of duty or road freight trips worked in that district during that calendar year. For equity purposes, each paid vacation day taken by an employe will be considered as a yard tour of duty or road freight train trip to be credited in computing the employe's share of the Productivity Fund.

(c) Limitation, The productivity sharing provided for above is limited to the extent that the total amount of a protected employe's annual share of the Employe's Productivity Fund cannot exceed one-third (1/3) of said employe's total compensation for that calendar year. The $48.25 payment into the Employes' Productivity Fund is not subject to wage and cost-of-living allowance increases.

When a protected employe has shares in more than one Productivity Account, the amounts due from each account will be combined and the total amount paid cannot exceed one-third (1/3) of the employe's total compensation for that calendar year.

When computing one-third (1/3) of a protected employe's total compensation in any calendar year, payments or credits received from the Productivity Fund during such calendar year will not be included in the computation.

(d) Guarantees. Payment made to protected employes out of the Productivity Fund shall not be used in the computation or offset of any monetary guarantees,

(e) Vacation Pay. Payments made to protected employes out or tue Trust Fund shall not be included in the compensation used as a basis for determining vacation pay.

(f) Part-Time Employment. A part-time UTU officer or representative who' is unable to work his assignment in road freight or yard service due to being engaged in official union business will receive credit for such days (of service) or tours of duty lost toward the number of days shared in the Fund. Verification for credits earned will be furnished by the United Transportation Union.

A Carrier officer or Union officer/representative who works a part of the year in the craft of conductor, brakeman or yardman will receive credit for the number of trips or tours of duty toward the number of days shared in the Fund.

Section 2. Computation of Shares. The value of the employe's share in the division of the Productivity Fund, calculated according to the number of yard tours of duty or road freight trips worked at the end of each year, will be determined in accordance with the following example:

Amount in Fund at the end of year ---$2,820,408.00
Number of protected employes -------- 621
Total number of road freight service trips and yard tours of duty by protected employes only - 66,208

$2,820,408 f 66,208 = $42.60

Each protected employe receives $42.60 x the number of his trips or tours of duty, e.g. 
221 trips x $42.60 = $9,414.60

One-Third Cap Limitation:

A protected employe earns $27,000 for service performed. The employe's payment from the fund for the year could not exceed $9,000.00 (1/3 of $27,000.00).

Section 5. Productivity Fund Phase-Out. The Company's regular pay period cash deposits to the Employes' Productivity Fund may be discontinued after the actual dollar amount deposited is equal to not less than the full amount required to pay all protected employes a full one-third (1/3) of their annual compensation for that calendar year. If the amount paid is not adequate to pay all monies due under this Agreement, the Company will make up the deficit.

Section 4. Trust Fund Agreement. The necessary arrangements for the establishment and administration of the Employes' Productivity Fund in compliance with ERISA and other legal requirements will be finalized within one hundred twenty days from the effective date of this Agreement.