Corporate Policy and Pocedure

Corporate Policy and Pocedure Policy # Revision # Effective Date: July 23, 2015 Prepared by: Workforce Compliance Approved by: Compliance Committee Title: Southern Company Gas Drug and Alcohol Policy Purpose: Southern Company Gas and its subsidiaries are committed to the safety of their employees and the public. The misuse, legal and illegal, of alcohol or drugs, while on Company premises or business interferes with a safe, healthy and productive work environment and therefore is prohibited. The Company will comply with all applicable laws and regulations, including the Drug-Free Workplace Act of 1988, and the United States Department of Transportation s (DOT) drug and alcohol testing regulations. Scope: This Policy applies to Southern Company Gas and to its direct and indirect (i.e., second tier and below) subsidiaries (collectively the Company ). This Policy covers all employees and incorporates the drug and alcohol testing required for employees in positions considered safety sensitive by federal regulations. To the extent any employee is covered by a collective bargaining agreement that is inconsistent with a provision of this Policy, the terms of the collective bargaining agreement shall apply. This Policy supersedes any other Company policy, practice or guideline governing the misuse of drugs and alcohol. The Company reserves the right to change or modify this Policy and its practices at any time, without advance notice. This Policy does not constitute a contract of employment and does not affect any employee s at-will employment status. General Policy on Drugs and Alcohol A. All Employees Substances covered by this Policy include but are not limited to alcohol, marijuana, cocaine, opiates, amphetamines, phencyclidine (PCP) or any drugs or controlled substances that are not prescribed by a licensed medical doctor, as well as prescription drugs used in a manner inconsistent with recognized medical practices. The use of prescription medication by someone other than the individual for whom it was prescribed is prohibited by federal law and is considered illegal use and subject to disciplinary action under this Policy. Employees taking a drug or other medication, whether or not prescribed by a physician, which could impair judgment, coordination, or other senses important to the safe and productive performance of work, must notify their immediate supervisor prior to starting their workday. Supervisory personnel will determine whether those employees can work and will impose any necessary work restrictions. 1

As a condition of employment, all employees must report to work in a condition ready to perform their assigned duties. The Company prohibits the misuse of drugs, both legal and illegal, while on Company premises or while conducting Company business. Specifically, the Company prohibits the use, manufacture, possession, distribution, or sale of illegal drugs (including controlled substances not used according to a medical prescription) on its premises, in its vehicles, or while conducting Company business. Advance approval by an officer of Southern Company Gas, or one of its subsidiaries, is required prior to service, consumption, or possession of alcohol on Company property. Such approval is also required before the service of alcohol at any Company event that takes place offsite. In all other circumstances, and unless such officer approval has been given for the service of alcohol, it is a violation of this policy for an employee to be in possession of or under the influence of alcohol (i.e. having a blood alcohol level of greater than 0.02) while on Company property. The Company also prohibits the use or possession of alcohol in Company vehicles. No employee may operate a Company vehicle while under the influence of alcohol or other drugs that impair his or her ability to drive. When representing the Company at an offsite event or function (even those not sponsored by the Company), employees should remember to act responsibly. Even when the use of alcohol is otherwise appropriate under this Policy, employees should always be careful to drink responsibly and to avoid excessive consumption that could impair judgment or driving, or create an appearance of impropriety. Any employee who is under the influence of alcohol and engages in inappropriate behavior while representing the Company or while conducting Company business may be subject to disciplinary action up to and including termination. Any employee who violates this Policy will be subject to disciplinary action, up to and including termination of employment. A verified positive drug test or a confirmed positive alcohol test (i.e. having a blood alcohol level of greater than 0.02) is considered proof that the employee is under the influence of drugs or alcohol for purposes of this Policy. Other evidence or behaviors associated with the misuse of drugs or alcohol also may cause Southern Company Gas to conclude that an employee is under the influence of drugs or alcohol in violation of this Policy. The illegal use, sale or possession of narcotics, drugs or controlled substances while on the job or on Company property is a serious offense. Any illegal substances will be turned over to the appropriate law enforcement agency, which may result in criminal prosecution and disciplinary action, up to and including termination of employment. Off-the-job illegal alcohol or drug use that could adversely affect an employee s job performance or jeopardize the safety of other employees or of customers or the public or result in damage to Company equipment also may result in disciplinary action, up to and including termination of employment. An employee who is convicted for off-the-job drug or alcohol activities must notify his or her immediate supervisor within five calendar days of any such conviction. Any disciplinary action will be based on the nature of the conviction and other factors relating to the impact of the employee s conviction on the conduct of Company business. Employees who are experiencing alcohol-related problems or problems with controlled substances are encouraged to voluntarily seek treatment through an approved rehabilitation program. If an employee wants to enter such a program, he or she can receive assistance by contacting the Company s Employee Assistance Program (EAP) through Health Advocate at 855.424.6400. The treatment of an employee s substance abuse problem will be covered in accordance with the terms and provisions provided for in the Company s benefits program. 2

Supervisory personnel who become aware of violations of this Policy must report those violations to their immediate supervisor or manager. Failure to do so will result in disciplinary action, up to and including termination of employment. The Company reserves the right to conduct routine and/or random inspections of an employee s personal property while on Company property. An employee who refuses to consent to such a search will be subject to disciplinary action, up to and including termination of employment. Employees who are terminated as a result of violating this Policy will be provided with referral information on obtaining assistance from a substance abuse professional. Any individual who has been terminated as a result of violating this Policy is not eligible for rehire. Employees who violate this Policy and are not terminated may be required to be evaluated by a Substance Abuse Professional who shall determine what assistance, if any, the employee needs in resolving problems associated with alcohol and/or drug misuse. The successful completion of any prescribed program will be required for the employee to continue employment with the Company. After evaluation and successful completion of any prescribed program, the employee will be required to submit to return-to-duty drug testing and a breath alcohol test. The result of the drug screen must be negative and the breath alcohol test result must indicate an alcohol concentration level of less than 0.02 (blood/breath alcohol concentration is the amount of alcohol in the bloodstream or on one s breath) to permit continued employment with the Company. After returning to duty, the employee may also be subject to follow-up drug and/or alcohol testing for up to 60 months. An alcohol test result of 0.02 or greater, a positive drug test, or refusal to test will result in the employee s termination of employment. In addition to the followup testing requirements, the employee must continue participating in any counseling, therapy or other activity as directed by his or her drug and/or alcohol rehabilitation provider. The treatment of an employee s substance abuse will be covered in accordance with the terms and provisions provided for by the Company s benefits program. To the extent that any portion of the cost is not covered, the cost of treatment is the responsibility of the employee. B. Employees in Safety-Sensitive Positions Company designated safety-sensitive employees are those who either perform or have the potential to perform an operating, maintenance or emergency response function on a pipeline, storage facility or at an LNG facility that is regulated by federal regulations or who have a role requiring a commercial driver s license (CDL) in order to perform their job duties. Employees may contact members of the Workforce Compliance Department toll-free at 855.875.8457 with any questions regarding positions considered to be safetysensitive. Safety-sensitive employees are prohibited from being under the influence of illegal drugs or alcohol at any time while on duty, or while operating a Company vehicle. Additionally, a safetysensitive employee may not consume alcoholic beverages within eight hours of reporting to work or being on call, unless he or she is covered by a collective bargaining agreement that sets forth a shorter time period (the Reporting Period ). If an off-duty safety-sensitive employee has consumed alcoholic beverages within the Reporting Period and is called into work, he or she must report that fact to his or her supervisor. The supervisor has the discretion to allow the employee to work if a determination can be made that the employee s abilities are not impaired. However, in those situations, employees may not operate a commercial motor vehicle. When a safety-sensitive employee is on call, he or she is prohibited from consuming alcoholic beverages during the Reporting Period 3

before the start of the on-call period until the end of the on-call period. Employees will be subject to testing and may be removed from their positions and subject to disciplinary action as described below should they violate any of these requirements. Safety-sensitive employees who violate these provisions are subject to the following disciplinary action, in addition to discipline otherwise provided in this Policy: a. A minimum of a ten-day suspension of employment without pay if there is evidence that: i. The safety-sensitive employee consumed alcoholic beverages while on call, or during the Reporting Period prior to scheduled work or to being on call, or the employee is otherwise called into work and fails to report such consumption as required above; or ii. The safety-sensitive employee is on duty, on call, or operating a Company vehicle, and there is evidence that the employee has an alcohol concentration of 0.02 percent or greater, but less than or equal to 0.039 percent; or iii. The safety-sensitive employee is in possession of alcohol while on duty or in a Company vehicle. b. Termination of employment if: i. The safety-sensitive employee violates the terms of section 1.a. (above) and has already been suspended for a violation of those terms within the previous twelve-months; or ii. The safety-sensitive employee has consumed alcohol while on duty; or iii. The safety-sensitive employee is on duty, on call, or operating a Company vehicle, and there is evidence that the employee is under the influence of illegal drugs or has an alcohol concentration of 0.04 percent or greater; or iv. The safety-sensitive employee is in possession of illegal drugs or consumes illegal drugs while on duty, while on Company property, or while operating a Company vehicle. Drug and Alcohol Testing A. All Employees (and prospective employees) Company employees will not serve as a collector in conducting any required drug test. Drug test results will be determined by the Company s independent medical review officer (MRO) and reported to the Company for action as required. An employee may request verbally or in writing to the MRO a retest of a drug test specimen within 72 hours of notification from the MRO of a positive test result or a refusal to test because of adulteration or substitution. The individual will be required to pay for the cost of the shipment and reanalysis of the sample. The current cost of reanalysis may be obtained by contacting the Company s Workforce Compliance Department. The Company will reimburse the employee or applicant for the costs of the reanalysis if the retest of the specimen is negative. Alcohol test results will be determined by an independent qualified technician. Company employees will not serve as a technician in conducting any alcohol test. Breath-alcohol confirmation test results and blood-alcohol test results of 0.02 percent or greater are considered positive. The Company reserves the right to use bloodalcohol testing if breath-alcohol testing is not available in a reasonable-cause or post-accident testing situation and in any situation requiring a medical evaluation after a breath-alcohol test. 4

Under this Policy, whether reasonable cause or reasonable suspicion exists is determined by the Company based on specific, contemporaneous, and objective observations of an employee that he/she may have used a prohibited drug and/or violated the alcohol provisions herein. Objective factors include the appearance, behavior, speech, or body odors of the employee. For purposes of this Policy, the terms reasonable cause and reasonable suspicion may be used interchangeably. All employees are required to submit to testing in specific, work-related situations. A refusal to submit to testing will result in the employee s removal from his or her position and termination of employment. The following tests are required by Company policy: a. Pre-employment testing - All applicants who are offered employment with the Company are required to pass a drug test prior to hiring. Applicants who test positive will not be hired. b. Post-accident testing - Unless specified otherwise in this Policy, in a post-accident situation, employees are required to submit to an alcohol and/or drug test when there is reasonable cause/reasonable suspicion to believe they are using alcohol or a prohibited drug. If a decision is made to conduct post-accident testing where an employee was performing a safety-sensitive function at the time of the incident, testing procedures for safety-sensitive employees as described below shall be used. The Company will provide the employee with transportation to the testing facility and will ensure the employee is accompanied by a designated Company representative. After testing is completed, the Company will provide the employee with transportation home or the employee may make arrangements to be picked up. After testing, the employee will be suspended from his or her position pending test results, and this suspension will be unpaid if the employee tests positive for drugs or alcohol. c. Reasonable-cause/reasonable-suspicion testing - Unless specified otherwise in this Policy, all employees must submit to reasonable-cause drug testing when there is reasonable cause to believe they are using a prohibited drug. All employees must submit to reasonable-suspicion alcohol testing when there is reasonable suspicion to believe they have violated the Company s alcohol prohibitions. The Company will provide the employee with transportation to the testing facility and will ensure the employee is accompanied by a designated Company representative. After testing is completed, the Company will provide the employee with transportation home or the employee may make arrangements to be picked up. After testing, the employee will be suspended from his or her position pending test results, and this suspension will be unpaid if the employee tests positive for drugs or alcohol. d. Return-to-duty testing and follow-up testing after voluntary rehabilitation - An employee who wants to participate in the Company s voluntary rehabilitation program must inform his or her supervisor. It is an employee s responsibility to inform his or her supervisor immediately when a decision is made to seek treatment. A supervisor must be informed before an employee is in a drug or alcohol testing situation because refusal to submit to a required drug or alcohol test will result in the employee s removal from his or her position and termination of employment, and a positive drug or alcohol test will result in discipline as set forth above in this Policy. After an employee has informed his or her supervisor that voluntary rehabilitation is desired, he or she will be scheduled for assessment, counseling and rehabilitation. An employee will be allowed two working days to schedule an appointment. Employees in positions covered by DOT drug and alcohol testing regulations will not be allowed to perform safety-sensitive duties, while undergoing treatment as defined by their 5

rehabilitation program. Safety-sensitive employees will be allowed to perform non-safety-sensitive duties for which they are qualified if such work is available. Each employee will be required to sign a letter indicating compliance with Companyapproved rehabilitation procedures. Participation in the voluntary rehabilitation program will not result in disciplinary action. However, successful completion of the prescribed program will be required for the employee to continue employment with the Company. Once an employee has successfully completed the voluntary rehabilitation program, the employee will be required to submit to drug and/or alcohol return-to-duty testing; negative test results are required. After returning to duty, the employee will be subject to follow-up drug and/or alcohol testing for up to 60 months. A positive test or refusal to test will result in the employee s termination of employment. In addition to the follow-up testing requirements, the employee must continue participating in any counseling, therapy or other activity as directed by his or her drug and/or alcohol rehabilitation provider. The treatment of an employee s substance abuse will be covered in accordance with the terms and provisions provided for by the Company s benefits program. To the extent that any portion of the cost is not covered, it is the responsibility of the employee. B. Employees (and prospective employees) in Safety-Sensitive Positions Employees (and prospective employees) in safety-sensitive positions covered by the DOT drug and alcohol testing regulations must submit to drug and alcohol tests. Safety-sensitive employees are those who either perform or have the potential to perform an operating, maintenance or emergency response function on a pipeline, storage facility or at an LNG facility that is regulated by federal regulations or who have a role requiring a commercial driver s license (CDL) in order to perform their job duties. An employee is considered to be performing a safety-sensitive function when he or she actually is carrying out the function, ready to carry out the function or immediately available to carry out the function. A refusal to submit to testing will result in the employee s termination of employment. Employees transferring into safety-sensitive positions who have been with the Company less than three years or who will be driving a Company vehicle requiring the use of a CDL, as well as applicants for safety-sensitive positions, will be required to provide consent for the Company to conduct a background check on their drug and alcohol testing record. If the information obtained as a result of this request reveals a violation of the DOT drug and alcohol testing regulations, employees will be removed from their safety-sensitive position immediately if they have already been hired or transferred into a safety-sensitive position. Employees (or prospective employees) will either be refused employment or terminated unless they can provide the required documentation of their successful completion of DOT s return-to-duty requirements (including follow-up tests). The following tests are required by DOT regulations for safety-sensitive employees: a. Pre-employment/Job-reassignment testing - All individuals, including temporary employees, are required to pass a drug test prior to working in a safety-sensitive position. Additionally, employees who have been away from their safety sensitive role for longer than 30 days (typically following a Company approved leave of absence or Company mandated suspension) are required to pass a drug test prior to resuming performance of their safety sensitive duties. 6

b. Post-accident testing - Drug and alcohol testing is mandatory for employees who have a role requiring a commercial driver s license (CDL) in order to perform their job duties and who are involved in accidents meeting DOT criteria. For pipeline, storage facility and LNG employees in accident situations meeting federal DOT criteria or state criteria, if appropriate, drug and alcohol post-accident testing is required if the employee s performance contributed to the accident or cannot be completely discounted as a contributing factor to the accident. The decision not to administer a test will be based on the Company s determination, using the best available information at the time of the determination, that the employee s performance could not have contributed to the accident or that, because of the time between the performance and the accident, it is not likely that a drug or alcohol test would reveal whether the performance was affected by drug or alcohol use. Company supervisory personnel are responsible for verifying testing criteria in a post-accident situation. The Company will provide the employee with transportation to and from the testing facility and will ensure the employee is accompanied by a designated Company representative. In any post-accident testing situation, the drug test will be given no later than 32 hours after the accident. The alcohol test will be given within two hours if possible, but no later than eight hours after the accident. Employees required to take a postaccident test must remain readily available and must not use alcohol within eight hours after the accident or until tested, whichever occurs first, and employees who violate this requirement will be removed from their positions and terminated. After post-accident testing, a safetysensitive employee will be removed from his or her duties and transferred to non-safety sensitive duties until the results of the alcohol and drug tests are verified. c. Random testing - All employees in safety-sensitive positions are subject to random drug testing. Employees who have a role requiring a commercial driver s license (CDL) in order to perform their job duties are also subject to random alcohol testing. d. Reasonable-cause/reasonable-suspicion testing - Safety-sensitive employees must submit to reasonablecause drug testing when there is reasonable cause to believe they are using a prohibited drug. Safetysensitive employees must submit to reasonable-suspicion alcohol testing when there is reasonable suspicion to believe they have violated the alcohol prohibitions under the law or this Policy. The Company will provide the employee with transportation to the testing facility and will ensure the employee is accompanied by a designated Company representative. After testing is completed, the Company will provide the employee with transportation home or the employee may make arrangements to be picked up. After testing, the employee will be suspended from his or her position pending test results, and this suspension will be unpaid if the employee tests positive for drugs or alcohol. e. Return-to-duty and follow-up testing Employees who engage in specific DOTprohibited drug and/or alcohol usage and are not terminated must undergo testing as determined by a substance abuse professional in accordance with DOT regulations. Conclusion If employees have any questions about this Policy or any other related information, they should contact their supervisor or the Company s Workforce Compliance Department toll-free at 855.875.8457. 7