Westmoreland bankruptcy: What’s really at stake for Kemmerer coal miners

Retired miners plead bankruptcy court to ensure health care, pensions are maintained

Ever since Westmoreland Coal Company declared bankruptcy and filed for Chapter 11 relief in October, the future of the company has been shaky. But now, Westmoreland is proposing slashing retired workers’ health care coverage and pensions as a restructuring strategy.

Mike Dalpiaz, District 22 Vice President of the United Mine Workers of America, said poor management is to blame for Westmoreland’s financial troubles, not the obligations to retired workers. 

“Because of their bankruptcy, Westmoreland now wants to throw out the contracts we’ve negotiated,” Dalpiaz told the Gazette in a Nov. 29 phone interview. “The Kemmerer mine has been there for over 100 years, the UMWA has been negotiating for over 100 years, and we’ve never had a problem until Westmoreland came along. They’ve run the mine into the ground.”

At press time, at least 10 miners who retired from the Westmoreland Kemmerer mine had written letters to the bankruptcy court pleading the judge to consider the potential effects if Westmoreland cuts retirees health care and pensions because of bankruptcy. There have also been several letters written by retired Westmoreland miners from other states who are up against the same fate.

“Think of all those widows, who packed their husband’s lunch bucket and washed their clothes for 40 years when they went to work in the mines,” Dalpiaz said. “Their healthcare is subject to those cuts.”

In their letters, the miners detailed how hard they had worked at the mine, and how Westmoreland cutting their health care and pensions would be devastating to their families.

“Judge, as you know, coal miners, both underground and surface miners, are the hardest working people in America, and their safety and working conditions are the most dangerous in this country,” wrote retired Kemmerer miner Jim Vilos, citing health conditions like black lung and safety issues that working miners and retired miners face because of their work. “We the miners kept our end of the deal and Westmoreland needs to keep their promise, too!”

“Most people at the Kemmerer mine have worked there longer than Westmoreland has owned it,” Dalpiaz said. “They worked tough, cold jobs all those years, and now their health care and pensions that they earned could be completely eliminated.”

Dalpiaz said the bankruptcy court could order Westmoreland to keep the terms and conditions of their current collective bargaining agreements, but it’s unsure what the court’s decision will be.

“Bankruptcy laws in the U.S. are tainted against people and instead favor the corporations,” Dalpiaz said. “We know we need management, but not management that doesn’t have a damn clue what they’re doing. Miners in Wyoming and other places deserve better than that.”

Westmoreland recently petitioned the bankruptcy court to implement a “valued employee retention program.” Westmoreland employs 1,732 people in the U.S., and the retention program would give bonuses to 243 of those employees to persuade them to stay in the midst of uncertain bankruptcy proceedings.

Dalpiaz implied that the program was a thinly-veiled strategy to take care of management instead of miners, calling it a “slap in the face.”

However, the petition from Westmoreland states that the plan does not prioritize “insider” employees, but is a way to retain employees who are “highly skilled and have an intimate understanding of various operational intricacies, leases, coal assets, customer relationships, and vendor contracts.”

Still, paying bonuses to Westmoreland employees who have titles such as Vice President, Accounting Manager and Corporate Counsel doesn’t seem to sit well with miners who are fighting to retain the benefits they earned while working at the Kemmerer mine for decades.

“I have worked at the Westmoreland Coal Co. mine in Kemmerer, Wyoming, for 41 and a half years,” Lawrence Hinton wrote in a letter to the bankruptcy court. “I recently retired on February 28, 2018, and my wife and I were looking forward to a long and happy retirement. Now after over 41 years of planning, our financial future is in jeopardy with Westmoreland’s proposal in their bankruptcy case.”

According to a Nov. 26 court document, Westmoreland’s revenue for the twelve-month period that ended on Aug. 31 totaled $850 million. As of Oct. 8 (the date Westmoreland petitioned for bankruptcy relief under Chapter 11), the company’s debt is about $1.1 billion. 

On Dec. 3, the UMWA objected to Westmoreland’s recent disclosure statement, calling it a “meager effort to push along this bankruptcy proceeding despite the absence of a clear path forward.”

Throughout several eras of management under different companies, the Kemmerer mine has remained profitable. One key to the mine’s success is PacifiCorp’s neighboring Naughton power plant that serves as a sort of built-in customer for coal that is mined in Kemmerer. Westmoreland bought the mine from Chevron in 2012. Before that, the mine had been owned and operated by Pittsburgh and Midway Mining Co. (P&M) and Morrison-Knudsen Co (MK).

“We’re not in the business of breaking coal companies,” Dalpiaz said. “We want companies to make money, but Westmoreland has made poor decisions, like buying operations no one else wanted, and now the workers are going to pay for it.

“We won’t sit idle,” Dalpiaz continued. “If Westmoreland wants to work their employees to the bone and then strip their retirement benefits, they should get someone else to mine their coal.”

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