Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, February 5, 1992 TAG: 9202050083
SECTION: BUSINESS PAGE: C7 EDITION: METRO
SOURCE: Associated Press
DATELINE: CHARLESTON, W.VA. LENGTH: Medium
COAL OPERATORS MUST PAY HEALTH FUNDS
Three coal companies have been ordered to pay millions of dollars into health insurance funds for 120,000 United Mine Workers retirees.The ruling eliminates the need for legislation in Congress to bail out the funds, a group opposed to the bill said. But the union and Sen. Jay Rockefeller, who sponsored the legislation, disagree.
The U.S. District Court ruling, issued in Washington, D.C., was against Pittston Coal Group, Pittsburgh & Midway Coal Co. and Rawl Coal, an A.T. Massey Coal Co. subsidiary. Pittston said it will contest the ruling.
Judge Thomas F. Hogan ruled that any company that signed a national Bituminous Coal Operators Association contract after 1978 must continue paying into the funds, even if it hasn't signed recent association contracts.
A.T. Massey Coal, Pittston Coal and others stopped paying into the funds in 1984 and 1988, saying they were not required to because they had not signed the industrywide agreements.
Hogan upheld a clause that says companies not signing future agreements still must pay into the funds so the companies' retirees will have health care coverage.
"No employer would want to be left paying for the benefits for retirees of other employers who decided to skip out on their obligation," Hogan said.
Pittston spokesman William Byrne said the company considers Hogan's decision wrong on both substantive and procedural grounds, and the company intends to fight it. Pittston, Virginia's largest coal producer, said the UMW agrees with its position. The UMW benefit and retirement funds are trusts that operate independently of the union.
Pittston Coal Group companies had withdrawn from the coal operators association before the 1988 contract talks and negotiated their own contract with the UMW covering all obligations to the union's pension and benefit funds.
It was not immediately clear how much money the three companies would pay. Although Pittston has not completed its analysis of the ruling, Byrne said the coal group would be liable for additional past contributions of $6 million to $10 million, not counting interest and any penalty, and up to $8 million annually in ongoing costs.
UMW President Richard Trumka said Hogan's ruling "does not immediately affect the health care crisis that's facing 120,000 retired miners and widows."
The Coal Commission, formed by former Secretary of Labor Elizabeth Dole to study the miner health-care issue following the 1989-90 Pittston strike, took into account the possible court ruling and concluded that even if the companies were forced to pay into the trust funds again, it would not be enough to keep the system from collapsing, Trumka said.
Staff writer Greg Edwards contributed to this story.