Blackjewel hints at recall of miners

GILLETTE — A letter to locked out Blackjewel LLC coal workers at the company’s shuttered Eagle Butte and Belle Ayr operations foreshadows a possible reopening of the mines and leaves almost 600 employees with more questions than answers.

Blackjewel filed for Chapter 11 bankruptcy protection July 1 and abruptly closed its 32 operations in Wyoming and across Appalachia and locked out about 1,700 workers. Since then, employees have had their final paychecks bounce, haven’t been paid for other time worked, haven’t had 401(k) and health insurance account contributions paid and, as of the end of August, have had their health insurance canceled.

Now the company wants to know if the Wyoming mines were to reopen, how many of its 580 Campbell County workers would return if recalled.

Hundreds of those employees already have applied for and have been collecting unemployment from the state and hundreds more have found other jobs since, as the letter states, “the company was forced to temporarily furlough several employees.”

While noncommittal, the letter asks workers if they’d come back. If they don’t respond by Sept. 19, then Blackjewel will consider that a resignation.

“The company is currently considering restarting production efforts at the facilities and, as a result, may be in the position to recall furloughed workers,” the letter says. “The company does not know specifically when it would restart production, but if it is in the position to do so, it could restart operations during the next several days or during the coming weeks.”

Employees are given the contact information of a company human resources person and told that if they “are not available or willing to return to work, we certainly would understand and wish you all the best in your future endeavors.”

While the prospect of returning to work is appealing to some, the thought of actively working for Blackjewel again would be difficult, said one longtime mine worker who asked not to be identified. While he said he may return if recalled, he knows of many others who wouldn’t even if they haven’t yet found other jobs.

“The dislike for and distrust of Blackjewel at this point is at such a high, I don’t know if they’d have many good people willing to go back,” he said.

He also said the wording of the letter is so vague that it instills little confidence a recall actually could happen.

“I’ll believe it when I see it,” he said.

Although Contura Energy Inc. was approved Aug. 6 by a federal U.S. Bankruptcy Court judge to buy the Wyoming mines, the sale is contingent on Contura reaching an agreement with the government over unpaid royalties.

In the 36 days since, the sale seems to have hit a stalemate and Blackjewel’s largest debt holder even called the deal “dead” in a court filing.

While Blackjewel’s letter could mean the company is working to reopen the mines on its own, it’s more likely it may have identified other potential buyers, said Robert Godby, director of the Center for Energy Economics and Public Policy at the University of Wyoming College of Business.

“There are a lot of questions here, but one is why now?” he said. “One answer could be is they’re still in negotiations with Contura. Another is they’re in negotiation with another party and the Contura sale really is ‘dead,’ which a lot of people suspect now.”

If there is another potential buyer for the mines, knowing what kind of skilled workforce is still attached to Eagle Butte and Belle Ayr is a critical asset, Godby said.

Campbell County Commission Chairman Rusty Bell said he would welcome another buyer for the mines other than Contura or Blackjewel reopening them itself.

“I hope they’re putting the feeler out there for a potential buyer,” he said.

Bell said the county has had some contact with other coal mining companies asking questions, but he doesn’t have direct knowledge of any negotiations.

What he does know is that since the Aug. 6 sale, “it has been very, very quiet about is there a deal, isn’t there a deal with Contura? I know there can’t be any deal without the federal government being OK with it.”

It’s unlikely Blackjewel would be looking to reopen the mines and operate them itself unless it somehow secured financing, something the cash-strapped company has had extreme difficulty doing since filing for bankruptcy July 1, Godby said.

Other than putting out feelers for another potential buyer, the Blackjewel letter also could be hedging the company’s bets against a wrongful termination lawsuit or clearing the way for a possible change to Chapter 7 liquidation.

Blackjewel already faces a lawsuit from workers at its Appalachia mines saying their sudden lockout was illegal because they didn’t get a lawfully mandated 60-day notice, Godby said. The letter makes it clear the company considers the Eagle Butte and Belle Ayr workers as “temporarily furloughed” and says that failure to respond will mean an employee has “abandoned your position with the company, or have resigned.”

“That they are officially claiming that these people are furloughed may have implications for their lawsuit and any legal things they have with the mass layoffs,” he said. “If you don’t respond, you have technically resigned your position, according to the company.”

Whatever the motivation, the company should know what kind of workforce it has left, he said.

“If they are trying to tell somebody these are viable mines, you need to show them there’s a viable workforce there,” Godby said. “We know a lot of workers have already moved on. This is kind of a carrot on a stick. The carrot is we may reopen the mines. The stick is, if you don’t respond, we consider it a resignation.”

Something that also should give employees pause is that while the letter says there is potential for the mines to reopen, it doesn’t give any specifics about what it means to remain a Blackjewel employee. By confirming a response to a recall, employees aren’t promised their health care would start up again or that their retirement contributions would be made whole, Godby said.

“Clearly, the employees are the collateral damage here, but they’re also a critical asset,” he said. “The suggestion is somebody might think there’s a possibility of opening those mines, and the necessary ingredient for that is a workforce.”

While he wants to look at the letter as a positive message and that a recall of workers may happen, Bell said it’s difficult to see the glass as half-full.

If he were a Blackjewel coal worker and received the letter, he said he would think “there isn’t anything in there. All it says is, ‘Hey, are you still willing to work for Blackjewel?’

“My thinking is yes, there are some, but I just can’t imagine there being a heck of a lot of confidence in that letter. I’m not feeling really, really confident in Blackjewel reopening the mines.”