Arguing that it is losing key employees wary of their future at the bankrupt coal company, Peabody Energy won approval for a bonus plan for nonexecutives that it says will help retain “mission critical” employees, the St. Louis Post-Dispatch reported yesterday. Bankruptcy Judge Barry Schermer said that Peabody’s plan “targets those that are in a position to help guide this reorganization.” Peabody asked for the authority to pay out as much as $3.24 million in bonuses to keep workers in its several departments from jumping ship as the company moves through bankruptcy. The largest coal company in the country filed for chapter 11 in April due to a high debt load and a sharp drop in coal demand in the face of low natural gas prices and tightening environmental regulations. Objections to the program came from United Mine Workers of America pension and health care funds, which argued the payments could come at the expense of money apportioned for retiree benefits. Peabody already reduced payments to one of the retiree health funds by $70 million in a deal struck prior to its bankruptcy. The employee bonus plan will first offer $2.74 million to 42 employees who remain with the company through bankruptcy, or roughly $65,000 a person. The bonuses are based on existing salary and the highest bonus won’t exceed $134,000. Peabody’s plan also calls for a $500,000 pool for discretionary bonuses it says will be paid to workers who become key employees. Such bonuses would be subject to bankruptcy court approval.
