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The National Labor Relations Board has ruled that Massey Energy Company and its subsidiary, Mammoth Coal Company, unlawfully refused to hire former unionized employees in order to avoid union obligations at a West Virginia coal mine it had purchased.

Massey bought the mine in Kanawha County in 2004 from Horizon Natural Resources Company after Horizon declared bankruptcy. Massey then created Mammoth Coal, a subsidiary, to operate the mine.

Horizon employees had long been represented by the United Mine Workers of America, and the union informed the new owners that 250 of the experienced Horizon miners were willing to return to work after the sale. The three-member Board panel – Brian E. Hayes, Richard F. Griffin, Jr., and Sharon Block -- agreed that Mammoth Coal Company went out of its way to avoid hiring the former employees in order to ensure that the reopened mine would be non-union. “Indeed, Mammoth’s hiring criteria can be best understood as mechanisms to screen out miners with an established connection to the union,” the Board found.

In the end, only 19 of the former miners were hired into a workforce of 219. Then, having eliminated the union, Mammoth unlawfully imposed a lower wage structure for all miners, the Board found.

Under the National Labor Relations Act, the buyer of a union company must recognize and bargain with the union if a majority of the buyer’s new employees came from the former union-represented workforce. It is also a violation of labor law to discriminate against union supporters in hiring.

Members Griffin and Block also found that Massey Energy was responsible for the discriminatory treatment of the miners because it directly participated in the unlawful conduct. “Massey made clear to the managers and supervisors making the hiring decisions for Mammoth that Massey would not accept a union in that operation,” the Board majority found. In addition, the Board majority, rejecting procedural arguments, found Massey and Mammoth to constitute a single employer based on their integrated operations and lack of arms-length relationship. (The Board had earlier asked all parties to the case to submit supplemental briefs on the single employer question.) Massey is therefore jointly liable for any remedies, including backpay for miners who were unlawfully discriminated against.

On that point, Member Hayes dissented. He found that neither the direct participation issue, nor the single employer issue were raised by the NLRB General Counsel in his complaint or in arguments before an administrative law judge who initially heard the case. He also found that the additional briefing requested by the Board did not cure that failure. “In their collective zeal to hold Massey liable – for the obvious reason that it is far more likely than Mammoth to have funds to meet backpay obligations – the Acting General Counsel and my colleagues have trampled due process,” Member Hayes wrote.

In its decision, the Board ordered Mammoth and Massey to offer employment to 85 named former Horizon employees and make them whole for lost earnings, to recognize the union and bargain with it on request, to restore the former terms and conditions of employment, and to bargain in good faith with the union regarding any changes. (In 2011, Massey Energy was purchased by Alpha Natural Resources.)