If passed, the legislation will affect coal companies subject to the 1992 Coal Act.
The proposals now making their way through the House and Senate are in response to the August ruling of a Kentucky federal bankruptcy judge that voided union contracts of Horizon Natural Resources and left 800 workers and 2,300 retirees without health benefits.
The companion bills were introduced last week by West Virginia Democrats Sen. Jay Rockefeller and Rep. Nick Rahall.
Rep. Rick Boucher, D-Abingdon, a co-sponsor of the House bill, says it will be retroactive - meaning that it could restore some benefits already lost in bankruptcy courts.
"It is a simple measure that says companies subject to the Coal Act cannot avoid their health benefits obligations," Boucher says. "It affects a very narrow class of companies."
The 1992 Coal Act states that companies with collective bargaining agreements with the United Mine Workers of America cannot duck benefit obligations by changing their identities or going out of business.
However, under current bankruptcy law, company employees are treated as unsecured creditors, putting them near the end of the list when it comes to obtaining satisfaction for obligations from the bankrupt company.
"It's been said that a company that sold a bag of rock dust to a mine last month has a higher claim in bankruptcy court than a retired miner who put in 40 years underground," Rockefeller said after the court decision was announced. "It's completely unfair."
Rockefeller wants to introduce legislation next year to protect workers in other industries as well.
Boucher says he expects support from the larger coal companies affected by the measure, just as they supported the act 12 years ago.
"I think that we can anticipate they will generally support it because if the smaller companies declare bankruptcy and avoid their obligations those obligations go to the fund," Boucher says.
The fund is the Combined Benefits Fund created to pay health benefits to retired union members and families left without benefits when companies they worked for went out of business or abandoned their commitments.
The future of the fund itself has been extended by an administrative measure by the federal Office of Surface Mining. The agency extended collection of taxes on coal - 35 cents per ton on surface mined coal and 10 cents per ton on underground mined coal - while Congress tries to come up legislation to extend the Abandoned Mined Land fund that expired Sept. 30.
Part of the money collected to reclaim abandoned mines is, by law, earmarked to pay retirees' benefits
Although several bills have been proposed, none has made through the legislative process to extend the law.