United Mine Workers of America (UMWA) launches double-pronged attack to defend benefits, 2012-2013

Peabody Energy Corporation is an international coal company based in St. Louis, Missouri (MO).  In 2007, they created a spinoff company Patriot Coal Corp., also based in St. Louis, MO.  Following the spinoff, Peabody Energy has gradually transferred responsibilities for many of its retirees over to the new company.

In July 2012, Patriot Coal Corp. filed for Chapter 11 bankruptcy, which involves the reorganization of a corporation to pull its business out of debt and keep it alive.  The proposed plan would potentially end health and retirement benefits to current workers and to retirees.  The cuts would affect not only Patriot workers, but also the retirees passed on from Peabody who stopped working prior to Patriot’s creation.  The company attributed its financial difficulties since 2007 to factors including problems with the coal market, increased costs, and other expenses related to the spinoff.  The reason for the bankruptcy is disputed however.  United Mine Workers of America (UMWA), which represents more than 1,650 of Patriot Coal’s current workers, argued that in fact, Peabody created the spinoff company expecting it to fail and saw it as a way to escape its financial obligations to retired miners.

In response to the bankruptcy claim, UMWA began organizing a “Fighting for Fairness at Patriot” campaign in August 2012 to protect the benefits of current Patriot employees and retirees.  The campaign began its first actions early in September, with demonstrations in St. Louis and West Virginia.  In October 2012, retired miners sent letters to the federal judge for the bankruptcy case, expressing their fear about Patriot’s bankruptcy and the potential loss of benefits. Also in October, the union filed a legal suit to claim that the spinoff in 2007 was fraudulent.  

Meanwhile, a secondary question – of the location of the hearings – arose alongside of the main issue of the bankruptcy.  On 11 September, a bankruptcy hearing began in New York City, and the judge sent live video feeds of the proceedings to Charleston, West Virginia and St. Louis, MO.  The union objected to the geographic distance between those affected by Patriot’s bankruptcy (i.e. the union, workers, retirees, families) and the site of the legal proceedings.  In protest on 11 Sept, hundreds of mine workers marched to the federal courthouse in Charleston where the video feed streamed inside and where UMWA lawyers argued to have the bankruptcy case moved to West Virginia.  The protesters picketed outside the courthouse to show their support for UMWA and for moving the case. In November 2012, the court granted UMWA’s request, ruling to move the case.  

In January 2013, the West Virginia bankruptcy hearings started.  With the issue of location resolved, UMWA continued its primary campaign, airing a television ad campaign objecting to the bankruptcy.  The series of ads included individual miners sharing stories, adding a personal element to public perception of the case, and voiceovers accusing Peabody of planning the bankruptcy at the time of the spinoff in order to get out of responsibilities.  Around the same time, the union continued marches and rallies.  Some UMWA members and supporters began intentionally provoking arrest in order to draw more attention to their campaign.  At a demonstration on 29 January 2013, 10 protesters disobeyed police orders to move while the group of around 800 prayed and sang.  

On 1 April, over 7,000 people marched to Patriot’s headquarters in Charlestown, WV.  Once there, 16 members of UMWA, including the president of the union, Robert E. Cecil, held a sit-in on the steps leading up to the building, and they were arrested.

Following the protest of the previous day, on 2 April 2013, Patriot requested permission to investigate Peabody’s 2007 spinoff for fraudulence.  The investigation would include demanding access to documents Peabody had previously refused to share with its spinoff company.

On 29 May 2013, the federal judge for Patriot’s bankruptcy case ruled that the company’s proposed cuts to healthcare, retirement, and wages were legal, granting them permission to make changes as planned.

This ruling marked a major turning point in UMWA’s campaign.  They refueled their efforts, continuing to seek legal action as well as organizing more demonstrations.  Over the summer of 2013, the union held a number of marches, rallies, and speeches in both West Virginia and Missouri, at which protesters continued to provoke arrest.  

In negotiations on 24 August 2013, UMWA and Patriot reached a compromise, approving a new contract.  This agreement reduced Patriot’s wage cuts from the $7/hr. allowed in the 29 May ruling to $1/hr.  Current Patriot workers can now keep their dental, vision, life, and accident insurance from before Patriot filed for bankruptcy.  Retirees and their families also will keep their healthcare plans.  The company is however putting caps on out-of-pocket medical and prescription drug coverage.  Patriot has also agreed to contribute $15 million to fund a new Voluntary Employee Benefits Association, and there are plans for it to gradually contribute more once it emerges from bankruptcy.  

While the goals of the original campaign have been mostly met (although only partially with respect to the compromise on wage cuts and the new caps on medical and drug coverage) and the immediate question of bankruptcy is resolved, UMWA plans to continue its work through more legal pursuits in order to further defend Peabody and Patriot employees.