Patriot Coal (OTC: PCXCQ), in Chapter 11 bankruptcy protection since July 2012, said Aug. 12 that its signatory subsidiaries have reached a consensual agreement with the United Mine Workers of America regarding their collective bargaining agreements and the provision of healthcare benefits for UMWA-represented retirees.
“This represents the successful conclusion of a difficult negotiation in which both the UMWA leadership and Patriot management have invested many long days. Both parties want to preserve jobs and protect healthcare benefits for retirees by keeping Patriot on track for reorganization – and not liquidation,” said Patriot President and CEO Bennett Hatfield. “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.”
The UMWA will be reviewing the terms of the agreement with its membership during the week of Aug. 12 as it prepares for a ratification vote on Aug 16. The company will also be filing a motion with the U.S. Bankruptcy Court in St. Louis seeking authorization to enter into this agreement.
The settlement with Patriot Coal covers new terms and conditions of employment that makes significant improvements over what bankruptcy Judge Kathy Surratt-States ordered on May 29, and what Patriot implemented on July 1 based on that court approval.
“After several weeks of nearly around-the-clock negotiations, I believe we have reached something that can be taken to the membership for ratification,” UMWA International President Cecil Roberts said. “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.”
Some 1,800 active or laid-off members in West Virginia and Kentucky are eligible to vote. The union said it will not release details of the settlement until after those members have had a chance to hear its terms.
Patriot Coal is a producer and marketer of coal in the eastern United States, with 11 active mining complexes in Northern and Central Appalachia and western Kentucky. Patriot ships to domestic and international electricity generators, industrial users and metallurgical coal customers, and controls approximately 1.8 billion tons of proven and probable coal reserves.