No appearance by the claimants.
Robert D. Pollitt, Senior Assistant Attorney General, for respondent.


This is a claim by the former employees of Chafe Mining, Inc., to
recover certain wages to
which they would be entitled under the purview of W.Va. Code Chapter 21,
Article 5, Section
14, the "Wage Bond Statute."

The Wage Bond Statute requires certain employers engaged in the
production of coal to post
a bond equal to the total of the employer's gross payroll for four
weeks, plus fifteen percent of
said total, with the Commissioner of Labor. In the event that an
employee does not receive his
or her wages and benefits when due, then that employee may recover
amounts owed through an
attachment against the wage bond.

On December 1, 1981, Telesystems Management and Technical Service
recorded a Uniform Commercial Code Financing Statement with the Raleigh
County Clerk.
This document granted Telesystems a security interest in certain mining
equipment which it had
sold to Chafe. An identical U.C.C. form was filed with the West Virginia
Secretary of State on
December 2, 1981.

On September 20, 1982, the West Virginia Commissioner of Labor was
advised by the
Attorney General of West Virginia that W.Va. Code Chapter 21, Article 5,
Section 14 prohibits
the acceptance of collateral for a wage bond.
On September 23, 1982, the Department of Labor accepted the Chafe Mining
equipment as
collateral for the wage bond in the amount of $115,000.00.

On March 21, 1985, Chafe Mining filed a Chapter 11 bankruptcy and in
November 1985,
closed its mining operation in Raleigh County.

The evidence establishes that at the time the Department of Labor
accepted the equipment for
the wage bond, Telesystem had a perfected security interest in the

As a result of a settlement agreement dated June 10, 1986, the West
Virginia Department of
labor received $2,000.00 for its claim on the equipment that was the
subject matter of the wage
bond. This left $113,000.00 outstanding, which should have been
available to the Chafe Mining

It is obvious that the purpose of the wage bond statute has failed in
this instance as a direct
result of the actions of the State agency charged with enforcing it.

The Department of Labor accepted an equipment bond after being advised
that they were
improper. More importantly, the Department accepted equipment subject to
a superior lien, a
lien which had been duly recorded.

The Legislature, in passing W.Va. Code Chapter 21, Article 5, Section 14
was attempting to
protect employees from fly-by-night companies who cease business owing
employees unpaid
wages. It would be unconscionable for the State to allow the neglect and
oversight of its
employees to thwart the intent of the Act.

It is, accordingly, the opinion of the Court that the negligence of the
Department of Labor
caused the claimants to lose the benefit of the provisions of W.Va. Code
Chapter 21, Article 5,
Section 14, and an award in the amount of $113,000.00 is hereby made.

Award of $113,000.00 to be made to the following named persons in
amounts indicated:

James Boggs $1,184.00
Floyd Bowyer $3,336.00
Richard Bryant $2,285.00
Timothy Cook $41,418.00
Charles Cox $1,684.00
Raymond Delp $165.00
Dennis Divers $4,250.00
Ronnie Evans $1,142.00
Charles Fisher $2,662.00
Walter Fletcher $1,275.00
James Gray $7,925.00
Lowery Jennings $1,634.00
Barry Lilly $1,618.00
James Martin $7,414.00
Kenneth Meador $4,545.00
Archie Milam $3,690.00
Jackie Milam $554.00
Albert McMillion $2,689.00
Albert Murdock $1,268.00
Robert Nichols $1,463.00
Gary Prather $892.00
Leslie Sadler $1,676.00
Ronnie Snuffer $864.00
Clifford Stover $1,790.00
Lonnie Stover $605.00
Ernest Taylor $731.00
Ronnie Thompso $4,302.00
Joey Toler $1,251.00
Mark Tucker $1,947.00
C. J. Walker $1,608.00
David Watson $406.00
Aubrey Whitt $1,495.00
Fred Williams $1,403.00
Timothy Williams $1,829.00