Dispute over pay agreement

Laid-off E. Ky. miners sue Tennessee coal company

December 27, 2012 

WHITESBURG — Five Eastern Kentucky miners who were laid off have filed lawsuits claiming a Tennessee coal company and two subsidiaries are refusing to pay them according to a signed agreement.

The Mountain Eagle reports the miners filed suit in Letcher Circuit Court against United Coal Co., based in Blountville, Tenn., and its subsidiaries, Whitesburg-based Sapphire Coal and Wellmore coal based in Big Rock, Va.

The suits say that the employees signed a "loyalty reward plan" which offered early payment of deferred compensation for layoffs or closings and that the companies haven't provided the payments.

A message at United Coal's office Wednesday says it will reopen Jan. 2. The newspaper says the company has 30 days from Dec. 13, when the suits were filed, to respond.

The complaints do not say how much the miners think the company owes them, but says the "amount in the controversy does not exceed $75,000."

The plaintiffs are James Cornett, Stanley Morgan, Mark Mullins, Mark Smith, Floyd Jason Reed and Tommy Vanover. They are all represented by attorney Daniel F. Dotson of Whitesburg and are seeking punitive damages in addition to the deferred payments.

A document attached to the lawsuit dated December 2001 is signed by a United Coal official and says the company will make early payment if miners were part of a layoff or closing.

"Clearly the plaintiff is entitled to receive payment of his deferred compensation account pursuant to the loyalty reward plan provisions," the lawsuit says. "The defendants have failed to provide the plaintiff with payment of the same."

United announced in the spring that it was closing its Sapphire operations and laying off 163 workers. The company also laid off miners from its Wellmore subsidiary, including an underground mine in Pike County where some of the men worked.

The loyalty reward plan called for 10 percent of a worker's salary to be put into a deferred compensation account where it would accrue for six years and the employees would receive a cash distribution.

"Accordingly," says the Metinvest/United Coal document attached to the complaint, "if you earn $700,000 during those (six) years, your taxable cash distribution will be $70,000. Assuming a combined federal and state withholding rate of 25 percent, your net cash distribution will be $52,500."

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service