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Stelco’s American parent company said in a news release on Tuesday morning that after “an exhaustive review of its compliance with each of its 34 undertakings,” it is in “full compliance” with the obligations it made under the Investment Canada Act when it bought Stelco in 2024.
This comes after Canada’s Industry Minister Mélanie Joly last week gave Cleveland Cliffs a 15-day deadline to reverse layoffs before turning to the courts.
Cleveland-Cliffs said late last month that it plans to lay off as many as 500 workers as it idles certain steel production at Hamilton-based Stelco.
Ron Wells, president of United Steelworkers Local 1005, previously told CBC that 333 layoffs were expected in Hamilton. USW Local 8782 president John McElroy said up to 50 layoffs are expected at the Lake Erie Works in Nanticoke.
In a demand letter sent to Ohio-based Cleveland-Cliffs on Thursday, Joly says the company is violating its commitments under the Investment Canada Act.
In a statement, Joly said, “I remain prepared to sit down with Cleveland-Cliffs to find a solution. But our bottom line is clear: protect Canadian jobs, defend our steel industry and ensure that commitments made to Canada are respected.”
In Tuesday’s release, Cleveland Cliffs said “Stelco’s performance exceeds the commitments that were made at the time of the acquisition. This includes the employment undertakings.”
The company also said that it asked for a meeting with Joly and Cleveland-Cliffs chairman and CEO Lourenco Goncalves “to discuss a path toward resuming full employment of the 175 workers in Hamilton who have been temporarily laid off.” The release said “notwithstanding her publicly stated willingness to sit down, the Minister has not yet responded to this request.”
Goncalves said the company wants “to find a solution for Hamilton and its workers as soon as possible and believes common sense trade policy will make this a reality.”
Strong 3rd-quarter results
While the company has said the layoffs are required to ensure its survival, Cleveland-Cliffs said last week that Stelco’s third quarter this year was its “strongest” since it acquired the Hamilton plant.
“Third quarter was Stelco’s strongest … since we acquired the company two years ago. The Canadian hot-rolled market has improved substantially,” Goncalves said in a statement on Oct. 19.
During an earnings call that day, Goncalves praised U.S. President Donald Trump’s trade policies, saying they are “helping create the conditions needed for companies like ours to continue investing in [local] communities and expanding domestic production,” despite Stelco citing tariffs as a key reason for economic struggles.
The company said the planned layoffs are in order to “ensure the survival” of the company, as U.S. tariffs on steel squeeze its sales. But Joly has dismissed that reasoning.
“Let me be clear: no act of God or change in market conditions can relieve Cleveland-Cliffs of the commitments it made to Canada. Those commitments are not optional,” she said in her statement.
United Steelworkers Local 1005 president Wells said, “If they’re profitable, why’d he shut down our [cold-rolled] and coated [steel] departments?”
The company says Stelco will update its compliance report after the close of the current reporting period on Oct. 31.