The United Mine Workers of America on August 12 announced that it had reached a tentative agreement with Patriot Coal on the terms of a new contract.
UMWA President Cecil Roberts called the agreement “a significant improvement” over the new employment terms approved by a federal bankruptcy court in May and implemented by Patriot in July.
“After several weeks of nearly around-the-clock negotiations, I believe we have reached something that can be taken to the membership for ratification,” said Roberts. “We have been able to restore, or at least improve upon, many of the most drastic changes that the Judge ordered, including in the area of wages, health care benefits, paid time off, pensions, and more. In addition, we have negotiated a mechanism that will allow retiree health care benefits to continue.”
Details of the tentative agreement were not made public. The details will be presented to 1,800 UMWA members at Patriot, who will vote Friday, August 16 on whether to accept the agreement.
Patriot in 2012 filed for bankruptcy, claiming that the sudden drop in coal prices and its obligation to maintain retiree health and retirement benefits made it impossible for the company to meet its debt obligations.
After the bankruptcy filing, UMWA waged a campaign for Fairness at Patriot to protect retiree benefits and to keep Patriot from lowering active employee wages and benefits to non-union levels.
Patriot was created and spun off in 2007 by Peabody Energy, a multi-national energy and natural resourcescompany that at one time was the US’s largest coal company. UMWA contends that the spin-off was designed to help Peabody eliminate retiree pension and health care obligations.
The day after the tentative agreement was announced, UMWA as part of its Fairness at Patriot campaign held a demonstration and rally at the Peabody headquarters in St. Louis. More than 1,000 people attended.
After the rally, some miners and their supporters including AFT President Randi Weingarten held a sit-in in front of Peabody headquarters where they were arrested.
The rally and sit-in was the latest in a series of similar Fairness at Patriot actions taken at Peabody headquarters and in West Virginia where much of Patriot’s operations are located.
At the August 13 rally, UMWA Secretary Treasurer Dan Kane told the audience that the union and their supporters needed to keep the pressure on to expose Peabody’s “nefarious scheme.”
“Peabody created Patriot to fail, and I am determined that is not going to happen,” said Kane.
According to the UMWA, “Patriot Coal represents Peabody’s. . . scheme to shed themselves of their obligations under the (National Bituminous Coal Wage Agreement) to maintain health care benefits for active employees and their families, as well as retirees, their dependents and surviving spouses. (Peabody) had promised, in contract after contract, to provide those benefits. But now, via Patriot, (Peabody intends) to rid (itself) of these obligations.”
When Patriot declared bankruptcy, it was providing benefits to 10,600 retired miners and their spouses. Of these more than 8,300 were retirees who worked for Peabody subsidiaries, not Patriot.
At the time of the spinoff, Peabody CEO Greg Boyce told investors that “we’re reducing our legacy liabilities roughly $1 billion, and reducing our expense and cash spending in the neighborhood of $100 million as well.”
Peabody’s spinoff and Patriot’s bankruptcy proceedings are the latest in a series of efforts by coal companies to jettison their obligation to retired members of UMWA and their families.
UMWA in 1989 conducted a 10-month strike when the Pittston Coal Company terminated retiree health care benefits and threatened to stop contributing the UMWA Health and Retirement Fund.
In response to the strike, the US Congress passed the Coal Act that protected health care and retirement benefits for UMWA retirees.
In 2004, Horizon Natural Resources declared bankruptcy, and the bankruptcy court allowed the company to liquidate its assets and terminate its retiree health care plan.
The US Congress at UMWA’s urging reacted by amending the Coal Act to protect retirees and their families affected by the Horizon bankruptcy.
Peabody’s spinoff, the UMWA contends, is just the latest scheme by a large energy corporation to escape its lawful obligation to its retirees.
“We need to put pressure on Peabody,” Kane said at the August 13 rally. “Because they stole from us. This is a pivotal moment. We need to be strong, we need to be disciplined, we need to be together. And I’m telling you today, Peabody, it ain’t over. Because you still owe your retirees. You don’t get to keep that.”