Business
4:15 pm
Tue September 17, 2013

Peabody Moves to End Obligations to UMWA Retirees

Peabody Energy Corp. wants a bankruptcy court to confirm that it can terminate its obligation to fund Patriot Coal’s retiree health care benefits.

Peabody is one of the largest private sector coal companies in the world and one of its many spin-offs is Patriot, which operates two mines in Union and Henderson counties.

Under Patriot Coal's new labor agreements with the United Mine Workers of America, its obligation to pay health care benefits for its retirees will terminate by January 1, 2014. Peabody’s commitment to retired miners will cease at the same time.

A bankruptcy judge ruled in May that Patriot could abandon its labor agreement with the UMWA, sparking a long dispute.

A settlement between the two passed in August, with 85 percent approval from miners. After Patriot's obligations to provide retiree healthcare benefits end, a Voluntary Employee Beneficiary Association will provide healthcare benefits to retirees.

Peabody says they have made several offers to contribute to the VEBA, but say the UMWA is being unreasonable.