Citizens United To Reform Bankruptcy Laws Blog

Wednesday, October 13, 2004

Bankrupt Public Policy Severely Harms Workers And Society

Op-Ed from Charleston Gazette Cecil E. RobertsInternational President, United Mine Workers of America

United Mine Workers of America (UMWA) coal miner Dwight Siemiaczko worked hard for 22 years–in often dangerous conditions–in order to earn his retirement. Over the years, he accepted less pay and lower pension benefits in exchange for the promise of lifetime health care benefits. But now, as he contemplates finally being able to retire and enjoy the fruits of his labor, his employer–Horizon Natural Resources–has asked a federal bankruptcy judge to void the terms of its negotiated contract with the UMWA, cancelling the health care benefits that Siemiaczko and thousands of others just like him were depending on to sustain them through retirement. And thanks to our nation's extremely unfair federal bankruptcy laws, if Horizon's request is granted, it will be legally permissible for this company to walk away from its promise to provide health care benefits. This is extremely bad public policy and on June 30, nearly 1,000 UMWA members and supporters rallied outside a Horizon bankruptcy hearing in Lexington, Ky., to say enough is enough. We will be back in Lexington on July 20 to send the same message.

At the June 30 Lexington rally–and at a meeting one day earlier in Benton, Ill., with nearly 300 Horizon active and retired UMWA miners and dependents–I reminded the crowds that the nation's flawed federal bankruptcy laws are not only crushing their dreams, but also the dreams of workers across the nation at companies like Enron, WorldCom and Bethlehem and Weirton Steel. The reality in America today is that people can work hard all their lives to earn a good pension, health care and other benefits but with just one stroke of a pen, a bankruptcy judge can take it all away–and the practice is alarmingly becoming more and more common. While it is true a lot of important issues will be debated during the course of the upcoming election season, near the top of every working person's list should be the need for our elected officials to reform America's bankruptcy laws–and our labor laws. If genuine reform does not happen, more and more working Americans will soon end up in the same boat as Siemiaczko and tens of thousands of others who did nothing wrong.

The UMWA recently added up the years of service provided to Horizon by the workers who stand to lose if the judge rules to void their contract. It totals somewhere around 100,000 years–but that astounding number means little in bankruptcy court. In fact, payment to a company that sold a bag of rock dust to Horizon last week will take precedence over ensuring a 30-year coal miner's health care benefits remain intact. Sad but true. Worse yet, many Horizon managers will probably be rehired by whomever purchases the mines in bankruptcy, but once their contract is voided, our UMWA-represented miners will lose their guarantee to future jobs–along with their health care benefits.

Fortunately, for a portion of Horizon's UMWA-represented coal miners, Congress passed the Coal Act in 1992, and that legislation ensures there will be no disruption to the health care benefits of those who retired before October 1994. However, for those who retired after that date–or who will be retiring–the promise of lifetime health care benefits can be terminated in bankruptcy court. And in terms of dollars and cents, the UMWA estimates that will mean an overall loss of some $500 million in benefits. That money not only aids the miners and their dependents but also the hospitals, pharmacies and other health care facilities in the small, rural communities these workers call home. I do not know if anyone has yet examined the impact of these kinds of bankruptcy judgments on our communities, but I can assure you it is not good. For this reason, mayors, local politicians, small and large business owners and community activists in every town across America should be out marching with the UMWA and others to reform our nation's bankruptcy laws. It may not be a problem in your community right now, but it could be soon.

When working Americans go to the polls this November, the UMWA is hopeful that the many recent images of corporate executives being escorted out of courtrooms in handcuffs will not be far from their minds. Horizon leaders may not be guilty of the crimes that landed some of these executives in jail, but, like them, they are guilty of running their companies into the ground financially. And while it is true that terrorism and our wars in Iraq and Afghanistan will most likely top the list of important issues facing our nation, the UMWA strongly believes that reforming our federal bankruptcy laws to limit their harmful impact on workers' benefits is equally important. In fact, it is now past time for real debate about a national health care policy. If that were to happen, these Horizon workers might end up with a federal law that would prevent them from having to suffer so much for management's mistakes.

The cruel irony in the UMWA's fight with Horizon is that Dwight Siemiaczko and all the others losing their health care benefits are the same people whose tax dollars are being used to provide our elected federal politicians–and, yes, even the judge deciding their fate–with their health care benefits. Someone please explain that injustice to me. One of our protesters sign's may have said it best, "The Rich Get Richer, and the Workers Get Screwed!" If you're a working American who agrees, please join the UMWA's fight to reform America's federal bankruptcy laws.

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