Former EKY miners allege labor act violations by now-bankrupt coal operation
Former employees of a now-bankrupt Eastern Kentucky coal mining operation are suing the company for failing to provide adequate notice before laying off about 300 workers late last month.
A Virginia coal miner intervened in federal bankruptcy proceedings involving Pike County-based Clintwood JOD LLC on behalf of himself and his former colleagues, alleging violations of the Worker Adjustment and Retraining Notification Act.
The WARN Act requires companies that employ 100 or more workers to give their employees at least 60 days notice before a mass layoff or plant closure. Exceptions can be made for employers seeking private capital investments, facing unforeseeable business circumstances or dealing with a natural disaster.
Clintwood JOD alerted its miners and coal-treatment-facility workers of a temporary, involuntary furlough Feb. 24 and followed up March 9 with permanent layoffs, according to copies of the letters posted on social media and reviewed by the Herald-Leader. The layoff notices cited “unforeseen business circumstances outside of Clintwood JOD, LLC’s control.”
But the complaint filed with the bankruptcy court last week said the company’s former employees should be compensated for missed wages, holiday and vacation accruals, as well as retirement and health insurance plan contributions for 60 days following the first set of letters Feb. 24.
The miners add to the growing list of creditors seeking repayment after the company entered into bankruptcy proceedings earlier this month. Clintwood JOD owes the mergers and acquisitions firm that gobbled up assets from a formerly bankrupt Pike County mine more than $26 million and Kentucky regulators want $3.4 million in unpaid severance taxes.
The company did not respond to a request for comment from the Herald-Leader.
It was unclear until now exactly how many employees Clintwood JOD had in its 16 mines and two coal-washing facilities across Central Appalachia. The March 25 filing floats the possibility of as many as 300 former workers, which suggests the Clintwood JOD grew nearly as large as the company it replaced.
Clintwood JOD rose out of the ashes of mining giant Cambrian Coal after that company went belly-up in 2019. It’s successor, organized by a New Jersey-based hedge fund, took control of assets in Eastern Kentucky and Northwestern Virginia and sought to capitalize on temporary disruptions in the coking coal market.
But it entered the market saddled with environmental citations, some of which it may not have been able to crawl out from under, according to a list of creditors reviewed by the Herald-Leader.
Kentucky’s coal mining economy fizzled amid rising production costs and intense competition from more easily extractable natural gas reserves elsewhere in America. The result has left Eastern Kentucky communities among the commonwealth’s poorest and precipitated a mass exodus from many isolated mountain counties.
