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Pittston accord.

Pittston accord

A tentative agreement was reached on New Year's Day between the Pittston Coat Co. and the United Mine Workers, effectively ending a 10-month job action by 1,700 miners in Virginia, West Virginia, and Kentucky. When announcing the settlement, Labor Secretary Elizabeth Dole stated her intentions to appoint a commission to study pension and health care issues in the coal industry and within 6 months to make "legislative" recommendations to ensure the long-term security of health and welfare benefits for coal miners covered by the so-called 1950 and 1974 trust funds.

The 1950 benefit trust fund, which was established to provide medical benefits for miners who retired before 1976, reportedly is being drawn against by some 130,000 retired miners and their families and is running at a $50 million to $60 million deficit. The 1974 benefit trust fund, which was established to provide benefits for retired, disabled, and laid-off miners whose last employer is no longer in business, is also beginning to show large deficits.

Secretary Dole appointed an 11-member Coal Commission, including William J. Usery (who mediated the dispute between Pittston and the Mine Workers) as chairman, 5 representatives of the United Mine Workers, and 5 from the Bituminous Coal Operators Association and other coal operators. A commission recommendation of a legislative solution to the problem of industry funding of pension and health benefits could impact the structure of bargaining in the industry.

The major issue in the Pittston--Mine Workers dispute was the company's participation in the industrywide health and welfare plans. Pittston had not participated in the last round of national coal negotiations, and had not paid into industrywide health and welfare funds since February 1988. (By withdrawing from industrywide funding, Pittston threatened the continuation of industry bargaining.) The company insisted that it would pay its share of benefits, but did not want its method of payment set by other companies in the industry.

Pittston's early bargaining proposals included demands for workers to share health care costs previously fully paid by the company, more flexible work rules and job classifications, mandatory overtime, and liberalized subcontracting rules. The union's primary demands involved fully paid health care and enhanced job opportunity and job security. After dropping out of the industrywide health and welfare funds, Pittston, during the negotiations, reportedly gradually softened its position on medical benefits, first restoring some benefits to about 1,600 miners who retired after 1976, and then promising to provide benefits to some 5,000 miners who retired before 1976. (Pittston had earlier claimed that the later group was the responsibility of the industrywide medical plan.)

The dispute involved all the ingredients of a modern day labor saga: millions of dollars in court levied fines for picket line violations and other violations of court injunctions, alleged violence and destruction of property, charges and counter charges of unfair labor practices filed with the National Labor Relations Board, wildcat strikes, worker occupation of one of the company's processing plants for 4 days, lawsuits, a strong display by organized labor of solidarity and support for the miners, and intervention by the Secretary of Labor.

The settlement came after marathon bargaining sessions conducted by William J. Usery, who had been appointed last October by Secretary Dole to mediate the dispute. Details of the pact were not made available to the general public until the rank and file ratified the agreement at membership meetings. Prior to the ratification vote, the parties had to agree on final contract language, resolve unfair labor charges, and decide what to do about the $63.5 million in outstanding court fines. In addition, trustees of the industrywide health and welfare funds had to approve the contract language relating to Pittston's benefit contributions.

The 54-month agreement reportedly provides for three annual wage increases of 40 cents per hour, and an amount in the fourth year equal to any initial wage increase in a successor national coal agreement. The miners will also receive a $1,000 ratification bonus. In addition, active miners and pensioners under age 65 will receive semiannual payments of $500 to cover a maximum $1,000 deductible for health insurance, a new cost-sharing provision in the health plan. In addition, Pittston agreed to provide active miners and retirees fully paid health care coverage identical to that in the 1988 national coal agreement.

The contract includes other concessions made by both parties. In return for being allowed to buy out of the 1950 benefit fund with a lump-sum payment of $10 million, Pittston agreed to continue to participate in the 1974 pension and benefit funds, with contributions capped at the levels set in the 1988 national coal agreement (8 cents per hour worked for each employee). In addition, laid-off miners will have limited rights to fill four of five vacant jobs at Pittston's nonunion facilities and, if production at the company's coal lands is subcontracted, 19 of 20 job openings at the contractor's facilities. In exchange for Pittston's pledge not to expand nonunion operations, the company was allowed to contract out repair and maintenance work, as well as the transportation of coal. The union also agreed to continuous operations of the mines and flexible work schedules, including a 28-day shift rotation, four 10-hour work days, and work on Sundays. Industry insiders estimate Pittston could save $2-$3 a ton (compared with the $5 they sought) based on productivity improvements.

Other terms include the arbitration of disputes involving the firing of miners for strike-related activity, consideration of a productivity based profit-sharing plan; an agreement to cooperate to settle court cases related to the strike; increases in sickness and accident benefits, life insurance benefits, death benefits, and clothing allowances identical to those in the 1988 national coal agreement; and pension benefits and vacation days identical to those in the 1988 national coal agreement.
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Title Annotation:Developments in industrial relations; Pittston Coal Co.
Author:Cimini, Michael H.
Publication:Monthly Labor Review
Article Type:column
Date:May 1, 1990
Previous Article:Significant decisions in labor cases.
Next Article:Developments in steel.

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