The Register-Herald, Beckley, West Virginia

State News

August 12, 2013

Miners’ union, bankrupt Patriot Coal reach deal

ST, LOUIS — The nation’s biggest miners’ union and Patriot Coal Co. said Monday they have reached a potential settlement that the union claimed eases the severity of wage and benefits cuts a bankruptcy judge had allowed the company to impose.

The United Mine Workers of America did not publicly reveal details of the deal, pending a vote Friday by some 1,800 current or laid-off Patriot workers in West Virginia and Kentucky eligible to cast a ballot. St. Louis-based Patriot also wasn’t releasing the terms.

But the union says the deal significantly improves upon the cuts Patriot enacted July 1, a little more than a month after U.S. Bankruptcy Judge Kathy Surratt-States allowed the company to abandon its collective-bargaining agreements with the union.

“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,’ Cecil Roberts, the union’s president, said in a statement. “In addition, we have negotiated a mechanism that will allow retiree health care benefits to continue.”

Bennett Hatfield, Patriot’s president and chief executive, said in a separate statement the “successful conclusion of a difficult negotiation” helps the company avoid being dissolved.

“Both parties want to preserve jobs and protect health-care benefits for retirees by keeping Patriot on track for reorganization — and not liquidation,” Hatfield said. “We appreciate the cooperation of the UMWA leadership and the sacrifices of all of our employees and retirees as we work to restore Patriot to viability.”

Patriot said it will seek the bankruptcy court’s authorization to enter into the agreement.

Last month, Patriot said without elaborating it had imposed less severe wage and benefit cuts on its miners than it could have under Surratt-States’ ruling, and that it would keep retired workers’ health plans unchanged for two months as negotiations with the union pressed on.

During an April hearing, the union, through its lawyer, threatened to strike if Surratt-States’ ruling didn’t go its way. Patriot countered that a strike “would put the company on a path to liquidation, which is the worst possible outcome for UMWA employees and retirees.”

Patriot’s proposed cuts have been the most contentious aspect since the Peabody Energy Corp. spinoff filed for Chapter 11 bankruptcy in July of last year, saying it would have to spend an unsustainable $1.6 billion to cover the health care costs, putting it at risk of folding.

 

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