MetroNews staff photo
One of the many demonstrations in which the union pressed Peabody, Arch, and Patriot Coal Companies to fulfills obligations to retirees.

ST. LOUIS, Mo. — The long-running battle between the United Mine Workers of America and Peabody and Patriot Coal appears to have reached a conclusion with Thursday’s announcement that the companies will fund retirement and healthcare benefits of retirees now grouped under the Patriot Coal umbrella.

“Peabody has continued to fund healthcare benefits for retirees during Patriot’s bankruptcy proceedings,” said Alexander C. Schoch, Peabody Energy’s executive vice president and chief legal officer. “We are pleased to resolve the uncertainty among Patriot retirees by providing substantial funding for the newly established Voluntary Employee Beneficiary Association (VEBA). Future healthcare benefits for Patriot retirees will now be determined by managers of the new VEBA.”

Under terms of the settlement, Peabody will provide $310 million to fund the VEBA over the next four years. The agreement terminated Peabody’s contractual obligation to certain retirees of Patriot. Additionally the healthcare of those retirees will also be funded in the future by the VEBA.

Patriot will contribute $15 million into the fund next year and $60 million over the next three years. Union officials said production-based royalty payments from Patriot will also be paid into the fund.

The union, in the agreement, will relinquish at 35-percent stake in Patriot which was awarded to the UMWA by a federal bankrtupcty judge in March. The union will also end it’s months long public relations campaign against the two companies which highlighted the impact retirees of the companies had faced.

“I am very pleased that we have been able to reach this agreement with Peabody and Patriot,” said UMWA International President Cecil Roberts. “This is a significant amount of money that will help maintain healthcare for thousands of retirees who earned those benefits though years of labor in America’s coal mines. This settlement will also help Patriot emerge from bankruptcy and continue to provide jobs for our members and thousands of others in West Virginia and Kentucky.”

The United Mine Workers lodged numerous demonstrations against Patriot, Peabody and Arch Coal, claiming Patriot was a company “set up to fail.” Patriot was formed in 2007 by Peabody and Arch and was saddled with a number of the larger companies’ retirees and benefit obligations. The obligation, combined with the downturn in the coal industry, forced Patriot into bankruptcy. The UMWA and Patriot previously reached agreement, but the union continued its pursuit of Peabody and Arch Coal for benefit obligations promised under previous union contracts.

The agreement still faces approval of U.S. Bankruptcy Judge Kathy Surratt-States. The union continues it’s battle with Arch Coal over obligations to Patriot retirees who spent their career working for Arch.

“Arch still can step up and meet its obligation to these retirees,” Roberts said. “We will continue to encourage them to do so in the coming days.”

Roberts also wants to continue to press Congress for legislation aimed at further protecting the retirees pensions and health benefits.

“This settlement, as significant as it is, still does not provide the level of funding needed to maintain health care for these retirees forever,” Roberts said. “That is why we are continuing our efforts to pass bipartisan legislation in Congress that will put these retirees under the Coal Act, meaning their long-term health care benefits would be secured at
no additional cost to taxpayers.”

U.S. Rep. David McKinley (R-W.Va.) and U.S. Sen. Jay Rockefeller (D-W.Va.) are lead sponsors of the legislation. HR 2918, introduced in the House by McKinley, currently has 24 co-sponsors from both parties. SB 468 was introduced in the Senate by Rockefeller and currently has six co-sponsors.

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  • jeff

    Just think about it nonunion patriot miners, who do you think will fight for you if Patriot cuts your pay, healthcare and pension if you even have one.

  • Rick S.

    So two sides actually came to an agreement on something? How about that? What a novel idea.

  • Bobby

    Mr. Roberts,
    I've said it before and I'll say it again. The members of the UMWA are blessed to have you as their leader.

    I have never belonged to a union but if I could join one, it would be the UMWA. You guys really know how to take care of each other.

    May god bless you all.

    • bulldog95

      If he was so awesome he would not have had the union to support the president in either election.

    • wvman75

      Horse manure.

      • wvman75

        I'll bet he voted for Obama.