Westmoreland Coal Company – Union Objects to Debtors’ Valued Employee Program, Citing Discriminatory Treatment and Lavish Spending on Management

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December 17, 2018 – The International Union of Operating Engineers, Local 953, AFL-CIO (“IUOE”) objected to the Debtors’ “Valued Employee Program [Docket No. 811] on the grounds that excluding the working man, while rewarding management, runs against the program’s stated goal of reducing “uncertainty” in order to retain employees. The objection states, “The IUOE represents two bargaining units of employees at the San Juan Mine in Waterflow, New Mexico: the Underground Unit and the Surface Unit. Between the two bargaining units, IUOE represents a little more than 200 employees, in job titles such as Miners, Carpenters, Electricians, Mechanics, Tiremen, Loaders, Heavy Equipment Operators, and Truck Drivers. That is, IUOE represents those employees whose primary responsibility is the day-to-day task of removing coal from the ground and making it available for sale. [The] Debtor has…proposed a plan that is neither fair nor reasonable, discriminates between bargaining unit and non-bargaining unit employees, and is not reasonably related to the stated goal of the program.

The stated ground for the program is employee retention which, Debtor claims, is particularly acute due to the ‘uncertainty’ caused by the bankruptcy process. The Debtor makes no effort to explain how spending an additional $1.4 million per quarter on select management employees will make it more certain that it will emerge from the proceedings as a going concern. That is, how does lavish spending on additional bonuses for management employees reduce (rather than increase) the uncertainty that the Company as a whole will emerge in sound fiscal shape? It does not, and that fact shows the disconnect between the stated purpose of the program and its likely outcome. Moreover, Debtor makes no effort to explain how the “uncertainty” does not affect the rank and file employees just as much as management.  Debtor also makes no effort to explain how the rank and file are not as essential to the enterprise as the management employees it has unilaterally determined to provide a bonus to.”

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