Opinion of Trustees
Resolution of Dispute
Case No. 84-520
Page 1
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OPINION OF TRUSTEES
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In Re
Complainant: Employee
Respondent: Employer
ROD Case No: 84-520 – February 3, 1988
Board of Trustees: Joseph P. Connors, Sr., Chairman; Paul R. Dean, Trustee; William B. Jordan,
Trustee; William Miller, Trustee; Donald E. Pierce, Jr., Trustee.
Pursuant to Article IX of the United Mine Workers of America (“UMWA”) 1950 Benefit Plan
and Trust, and under the authority of an exemption granted by the United States Department of
Labor, the Trustees have reviewed the facts and circumstances of this dispute concerning the
provision of health benefits coverage under the terms of the Employer Benefit Plan.
Background Facts
The Complainant was employed by the Respondent in a classified position from September 1979
until May 9, 1987, when he was laid off. The Respondent provided health benefits coverage for
the Complainant through the Bituminous Industry Trust/Business Insurance Trust (“BIT”) and
California Life Insurance until April 30, 1987, when the BIT was terminated. Due to insolvency,
the BIT and California Life Insurance have ceased paying health benefits claims for services
rendered prior to April 30, 1987. The Complainant has submitted copies of unpaid bills for
medical services rendered during his employment with the Respondent. The Complainant asks
who is responsible for payment of the medical bills that are unpaid due to the insolvency of BIT
and California Life Insurance.
Dispute
Whether the Respondent is responsible for payment of the outstanding medical charges incurred
by the Complainant and his eligible dependents during his employment with the Respondent.
Positions of the Parties
Position of the Complainant: The Complainant asks who is responsible for payment of the
covered medical charges incurred during his employment with the Respondent.
Position of the Respondent: The Respondent has not responded to repeated correspondence from
Funds’ staff regarding its position in this dispute.
Pertinent Provisions
Opinion of Trustees
Resolution of Dispute
Case No. 84-520
Page 2
Article XX Section (c)(3)(i) of the National Bituminous Coal Wage Agreement of 1984 provides
in pertinent part:
(c) 1974 Plans and Trusts
(3)(i) Each signatory Employer shall establish and maintain an
Employee benefit plan to provide, implemented through an
insurance carrier(s), health and other non-pension benefits for its
Employees covered by this Agreement as well as pensioners, under
the 1974 Pension Plan and Trust, whose last signatory classified
employment was with such Employer. The benefits provided by
the Employer to its eligible Participants pursuant to such plans
shall be guaranteed during the term of this Agreement by that
Employer at levels set forth in such plans.
Article I (1), (2) and (4) of the Employer Benefit Plan provide:
Article I – Definitions
The following terms shall have the meanings herein set forth:
(1) “Employer” means (Employer’s Name).
(2) “Wage Agreement” means the National Bituminous Coal Wage
Agreement of 1984, as amended from time to time and any successor
agreement.
(4) “Employee” shall mean a person working in a classified job for the
Employer, eligible to receive benefits hereunder.
Article II A. (1) of the Employer Benefit Plan provides:
Article II – Eligibility
The persons eligible to receive the health benefits pursuant to Article III are as follows:
A. Active Employees
Benefits under Article III shall be provided to any Employer who:
(1) is actively at work* for the Employer on the effective date of the
Wage Agreement;
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Opinion of Trustees
Resolution of Dispute
Case No. 84-520
Page 3 *
Actively at work includes an Employee of the Employer who was actively at work on
September 30, 1984, and who returns to active work with the Employer two weeks after the
effective date of the Wage Agreement.
Discussion
Article XX Section (c)(3)(i) of the 1984 Wage Agreement requires an Employer to provide an
Employer Benefit Plan… “implemented through an insurance carrier(s), [for] health and other
non-pension benefits…” It further requires that “benefits provided by the Employer to its eligible
Participants pursuant to such plans shall be guaranteed during the term of this Agreement by that
Employer at levels set forth in such plans.”
Article II. A of the Employer Benefit Plan provides health benefits coverage to active employees
working in classified jobs for a signatory Employer. The Respondent in the instant case
implemented its Employer Benefit Plan until April 30, 1987 through an employer trust fund and
insurance carrier. The employer trust fund and the carrier subsequently became insolvent.
Implementation of a plan through a carrier, in and of itself, does not relieve the Respondent of its
primary obligation to provide benefits pursuant to the Wage Agreement. Inasmuch as the
Complainant was eligible for health benefits coverage from the Respondent as an active
Employee at the time his outstanding medical charges were incurred, the Respondent is
responsible for payment of those charges under the terms of the Employer Benefit Plan.
Opinion of the Trustees
The Respondent is responsible for payment of the covered medical charges incurred by the
Complainant and his eligible dependents during his employment with the Respondent under the
terms of the Employer Benefit Plan.
