UMWA and Patriot discuss benefits agreement

The president of the United Mine Workers of America says a potential agreement between the union and Patriot Coal on wages and benefits could supersede any decision from a U.S. Bankruptcy Court judge.

“The best place to resolve this is not in St. Louis in that courtroom,” said union president Cecil Roberts. “Patriot and the union both are committed here to continue to bargain and to try to reach resolution.”

At this point, though, Roberts admitted the two sides are not close on retiree and healthcare benefits for thousands of employees. Patriot most recently proposed a voluntary employee benefit association, or VEBA, so the company would not have to directly provide promised benefits.

The talks are continuing with U.S. Bankruptcy Judge Kathy Surratt-States scheduled to rule before May 29 on Patriot Coal’s proposed reorganization under Chapter 11. A five-day court hearing was held last week.

Patriot contends it’s being crushed under “unsustainable labor related legacy liabilities,” but most of the retirees who will be affected by the restructuring never worked for Patriot.

Roberts said Peabody Coal is to blame for what he calls a fraudulent transaction that set up Patriot for failure. When Patriot Coal was formed, he said, too many of Peabody’s liabilities were moved there.

“What we need to try to do here is to try to fashion some agreement, if possible,” Roberts said.

“If it’s possible to reach some kind of agreement, (we need to) collectively challenge Peabody, who created this mess and who has lots of money to pay these bills and should be paying them.”