CHARLESTON, W.Va. -- Thousands of United Mine Workers members and supporters came to Charleston last week to rally against a proposal by bankrupt Patriot Coal to cut workers' and retirees' health benefits. They say Patriot was designed to go bankrupt and that other companies transferred their benefit costs to Patriot to avoid paying for them.
But hourly workers represented by the UMW aren't the only ones worried about what happens to them under a Patriot bankruptcy.
South Charleston resident Jim Gillenwater worked as a salaried supervisor for Peabody Coal for 35 years, then another four years as a private contractor.
Today, Gillenwater is afraid he and his wife, Phyllis, will lose all the health-care and pension benefits Peabody promised him over the years.
"I would like to see us all get to Medicare age. I am there, but my wife is not. That is where it is hitting us," Gillenwater said.
"I am already 65, but she is 60. It will be five years for her to get on Medicare. And the cost of buying health insurance is crazy high today."
Gillenwater is one of more than 1,000 current and retired salaried employees whose benefits are now provided by Patriot Coal.
Patriot, which filed for Chapter 11 bankruptcy July 9, 2012, is negotiating with the UMW about reducing benefits the company provides to union members.
But Patriot is trying to completely cut all benefits to its salaried employees, including retired salaried employees who worked for Peabody or Arch, according to Jon Cohen, a lawyer from the Chicago law firm of Stahl Cowen Crowley Addis, who represents Patriot's salaried retirees.
Salaried retirees represent 4 percent of all the company's retirees, Cohen said.
"From the company's perspective, they might feel that because they can take away benefits from its salaried employees, maybe they should do it," Cohen said.
"But they are not legally obligated to the creditors of the company [listed in the bankruptcy filing] to do this," Cohen said. "Under the law, retirees can be protected if the company chooses to do so. A company can say, 'No, that is not how we treat our workers.'
"This is a company where the bean counters have decided -- 'Let's step on the people who built this company, because we can.' That says a lot about the decision-makers. It is a moral decision. It is not a legal obligation."
Patriot Coal was founded Oct. 31, 2007, when Peabody Coal sold all its union operations east of the Mississippi to the newly-formed company.
In 2008, Patriot bought Magnum Coal, a company that had taken over the union mines once operated by Arch Coal.
"When they formed this company, I believe it was formed to fail," Gillenwater said. "Patriot even took the contracts that Peabody didn't want, the bad contracts Peabody had made."