Opinion of Trustees
Resolution of Dispute
Case No. 88-178
Page 1
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OPINION OF TRUSTEES
_____________________________________________________________________________
In Re
Complainants: Employees
Respondent: Employer
ROD Case No: 88-178 – February 28, 1990
Board of Trustees: Joseph P. Connors, Sr., Chairman; Paul R. Dean, Trustee; William Miller,
Trustee; Donald E. Pierce, Jr., Trustee; Thomas H. Saggau, 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 for Employees under the terms of the Employer Benefit
Plan.
Background Facts
The Complainants are employed in classified positions by the Respondent, a signatory employer.
The representative for the Complainants states that beginning June 16, 1989 there was a work
stoppage at the Respondent’s operations.
The Respondent notified the Complainants by memorandum dated June 23, 1989 that unless they
returned to work on or before June 26, 1989, their health benefits coverage would be terminated
as of the first day of the work stoppage. The Respondent notified the Complainants by letter
dated June 28, 1989 that because they had not returned to work, their employer-provided health
benefits coverage had been terminated on June 15, 1989. The Complainants were also notified
that they could choose to continue such coverage at their own expense for a period of up to 18
months. Some of the Complainants elected to continue their coverage by paying the appropriate
premium to the Respondent. Employer-provided coverage was reinstated when the
Complainants returned to work on July 17, 1989.
The Complainants contend that the Respondent should pay the medical expenses incurred by
them and their dependents during the period from June 16, 1989 through July 16, 1989 in
accordance with the terms of Article XX of the National Bituminous Coal Wage Agreement
(“Wage Agreement”) of 1988 and the Employer Benefit Plan established pursuant to the Wage
Agreement. The Complainants also request reimbursement of any health insurance premiums
they paid to continue their health benefits coverage during the work stoppage.
Opinion of Trustees
Resolution of Dispute
Case No. 88-178
Page 2
Dispute
Is the Respondent required to provide health benefits coverage for the Complainants during a
work stoppage, and, if so, is the Respondent responsible for reimbursement of the premiums paid
by some of the Complainants to continue coverage during the work stoppage.
Positions of the Parties
Position of the Complainants: The Respondent is required under the terms of the Wage
Agreement and the Employer Benefit Plan to pay the medical expenses incurred by the
Complainants and their eligible dependents during the period from June 16, 1989 through July
16, 1989, and to reimburse the Complainants for health insurance premiums paid by the
Complainants to continue coverage during the work stoppage.
Position of the Respondent: The Respondent is not required to provide health benefits coverage
for the Complainants during the work stoppage because the Complainants were not considered
“actively at work” or “actively employed” during the work stoppage. The Respondent also
contends that neither the 1988 Wage Agreement nor the Employer Benefit Plan requires an
Employer to provide health benefits coverage during a work stoppage.
Pertinent Provisions
Article XX Section (c)(3)(i) of the National Bituminous Coal Wage Agreement of 1988
provides, in pertinent part:
(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…. The plans established pursuant to this subsection are incorporated by
reference and made a part of this Agreement, and the terms and conditions under
which the health and other non-pension benefits will be provided under such
plans are as to be set forth in such plans.
Article I (1), (2) and (4) of the Employer Benefit Plan provide:
Article I – Definitions
Opinion of Trustees
Resolution of Dispute
Case No. 88-178
Page 3
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 1988, 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. 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 Employee who:
(1) is actively at work*
for the Employer on the effective date of the Wage
Agreement; or
(2) is on layoff or disabled from the Employer and had continuing eligibility
as of the effective date of the Wage Agreement for coverage under the
1984 Employer’s Benefit Plan (“prior Plan”) as a laid-off or disabled
employee. Coverage for such laid-off or disabled Employees shall not
continue beyond the date when they would no longer have been eligible
for such coverage under the provisions of the prior Plan.
(3) Except as provided in paragraph (2) above, any Employee of the
Employer who is not actively at work*
for the Employer on the effective
date of the Wage Agreement will not be eligible for coverage under the
Plan until he returns to active employment with the Employer.
Any Employee of the Employer who as of January 31, 1988, was eligible
for benefits under the prior Plan who is not scheduled to work within two
weeks after the effective date of the Wage Agreement because of lack of
work, such an Employee will, for purposes of this Plan, be considered
eligible for coverage under this Plan as of the effective date of the Wage
Agreement but as an Employee on layoff as of such date.
________
*
Actively at work includes an Employee of the Employer who was actively at work on January
31, 1988, and who returns to active work with the Employer two weeks after the effective date of
the Wage Agreement.
Opinion of Trustees
Resolution of Dispute
Case No. 88-178
Page 4
(4) A new Employee will be eligible for health benefits from the first day
worked with the Employer.
Article III D (1)(c) and (e) of the Employer Benefit Plan provide, in pertinent part:
Article III – Benefits
D. General Provisions
(1) Continuation of Coverage
(c) Leave of Absence
1. During any period for which an employee is granted an
approved leave of absence for the purpose of accepting temporary
employment with the United Mine Workers of America (UMWA)
such Employee shall be eligible to continue health, life and
accidental death and dismemberment coverage for a period not to
exceed 120 calendar days within any 12-month period.
2. During any period for which an Employee is granted an
approved leave of absence for any other reason, such Employee’s
eligibility for health, life and accidental death and dismemberment
insurance coverage shall be terminated as of the day last worked
and shall not be reinstated until the Employee returns to active
work except as provided in paragraph 3 below.
. . .
(e) Quit or Discharge
If an Employee quits (for any reason) or is discharged, health life
and accidental death and dismemberment coverage will terminate as of the
date last worked….
Discussion
The Complainants contend that the Respondent is required to provide health benefits coverage
during the work stoppage from June 16, 1989 through July 16, 1989. The Trustees have
addressed the issue of an Employer’s obligation under the Employer Benefit Plan to provide for
Employees during a work stoppage in ROD 88-181 (copy enclosed herein). In their decision in
ROD 88-181, which assumed that the Wage Agreement was in full force and effect, the Trustees
concluded that under the Employer Benefit Plan, the Employer was responsible for providing
health benefit coverage for its Employees during the work stoppage. The Respondent has made
the additional argument that the negotiators of the Wage Agreement did not intend that strikers
Opinion of Trustees
Resolution of Dispute
Case No. 88-178
Page 5
would ever be entitled to health benefits coverage because they provided for termination of such
coverage during strikes occurring at the expiration of a Wage Agreement and for resumption of
such coverage when strikers return to work after such strikes. The provisions regarding
coverage during strikes occurring at the expiration of a Wage Agreement do not apply to a work
stoppage occurring when the Wage Agreement is assumed to be in effect. Accordingly, the
Respondent is responsible for providing health benefits coverage for the Complainants during
the work stoppage from June 16, 1989 through July 16, 1989.
The Complainants also ask that the Respondent be required to reimburse them for health
insurance premiums which Complainants paid to the Respondent pursuant to a COBRA
continuation of coverage offer made by the Respondent at the time of the termination of
coverage. The Trustees have previously held that Employers were not responsible for
reimbursement of private insurance premiums even though the Trustees found the Employers to
be obligated for coverage under the Employer Benefit Plan for the periods covered by the
premiums. See RODs 81-17, 81-640 and 84-437. The RODs are distinguishable because in all
of these cases the insurance was purchased by the beneficiaries on their own from third party
insurers. In this instance the premiums are paid directly to the employer for a continuation of
coverage in the Employer Benefit Plan. Thus the Plan has met any obligations to pay benefits
for the beneficiary. However, based on the Trustees assumption that the Wage Agreement was
in full force and effect, there was no COBRA event and therefore the premiums were collected in
error. Therefore, the premiums must now be refunded to the beneficiaries.
Opinion of the Trustees
Based upon the provisions of and consistent with the terms of the Employer Benefit Plan, the
Respondent is responsible for providing health benefits coverage to the Complainants and their
eligible dependents during the work stoppage from June 16, 1989 through July 16, 1989, and for
providing reimbursement for health insurance premiums paid by the Complainants to continue
coverage during the work stoppage.
