Walter Energy Judge Warns Mine Workers May Lose Everything

  • Miners ready to risk jobs rather than make safety concessions
  • Judge faults union's `game of chicken' as Walter seeks sale

A union lawyer negotiating with Walter Energy Inc. said miners would rather gamble jobs at the bankrupt coal producer than make additional concessions, a stance the judge called “a game of chicken.”

Walter Energy filed for bankruptcy in July and is set to put its assets up for auction Jan. 5. As an opening bid, lenders have offered to exchange $1.25 billion in debt and pay $5.4 million in cash. That agreement hinges on a consensual resolution with unions or court approval to reject collective-bargaining agreements.

The union’s lawyer told U.S. Bankruptcy Judge Tamara O. Mitchell in Birmingham, Alabama, on Tuesday that issues involving worker safety were too important to bargain away. Mitchell cautioned that under such a strategy, the union “stands to lose everything.”

If the union wins, “the buyer walks because there’s no sale and then all the employees are out of a job, the mines close down” and there won’t be benefits for anyone, Mitchell said.

Sharon Levine, the attorney for the United Mine Workers of America, said the union’s stance is “not a threat.”

“With these kinds of jobs, in this kind of industry, there are certain terms and conditions,” Levine said. “If that means the mines close, we understand that the mines close.”

The hearing will continue Wednesday as the judge weighs Walter Energy’s requests to pay retention bonuses to key employees and reject the labor agreements.

The case is In re Walter Energy Inc., 15-02741, U.S. Bankruptcy Court, Northern District of Alabama (Birmingham).

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