{"id":928082,"date":"2026-10-10T18:50:09","date_gmt":"2026-10-10T18:50:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/928082\/"},"modified":"2026-10-10T18:50:09","modified_gmt":"2026-10-10T18:50:09","slug":"stelco-says-it-is-proceeding-with-ontario-layoffs-after-ottawa-issues-ultimatum","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/928082\/","title":{"rendered":"Stelco says it is proceeding with Ontario layoffs after Ottawa issues ultimatum"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Stelco said on Sept. 28 that it was laying off up to 500 workers in Hamilton and Nanticoke, Ont.Peter Power\/The Canadian Press<\/p>\n

Stelco Inc. has informed Ottawa it is not in violation of its Investment Canada Act job commitments, and it is proceeding as planned with hundreds of layoffs in Canada.<\/p>\n

Stelco, which is owned by U.S. steelmaker Cleveland-Cliffs Inc., said on Sept. 28 that it was laying off up to 500 workers in Hamilton and Nanticoke, Ont., saying it couldn\u2019t compete in galvanized steel as a result of the trade<\/a> war. <\/p>\n

When the federal government approved Cliffs\u2019 $3.4-billion acquisition of Stelco in 2024, it imposed legally binding conditions, including maintaining at least the same number of unionized employees<\/a> in Canada for five years, as well as the vast majority of non-unionized workers. <\/p>\n

On Monday Industry Minister M\u00e9lanie Joly issued the Cleveland-based steelmaker an ultimatum to map out a plan within five business days for complying with its employment guarantees under the Investment Canada Act or possibly face legal action<\/a>. <\/p>\n

In the company\u2019s response letter obtained by The Globe and Mail, Stelco president and general counsel Paul Simon on Friday told Ms. Joly the steelmaker is in fact not in violation of its commitments, citing a legal provision around the promises, and the government\u2019s own ICA guidelines. <\/p>\n

\u201cYour representation that Stelco\u2019s planned layoffs cause it to breach its undertakings is false,\u201d Mr. Simon wrote. \u201cAs the undertakings do not stipulate a commitment to avoid layoffs, nor do they include a requirement that employment levels be above a certain amount on each day of the five years of the undertakings.\u201d<\/p>\n

He added that the spirit of ICA gives the government plenty of flexibility to allow layoffs in unforeseen circumstances. <\/p>\n

\u201cThroughout the history of the Investment Canada Act and its predecessor foreign investment acts, it has consistently been understood that changes in circumstances may necessitate the non-enforcement or renegotiation of undertakings,\u201d he wrote. \u201cThis decades-old principle is set out in the Government of Canada\u2019s Investment Canada Act Guidelines \u2013 Administrative Procedures: Monitoring of Investments.\u201d<\/p>\n

Ms. Joly\u2019s office did not immediately respond to a request for comment. <\/p>\n

Stelco\u2019s exit from galvanized steel leaves big Canadian buyer baffled and in the lurch<\/a><\/p>\n

Cliffs argues that the imposition last year of a 50-per-cent tariff on Canadian steel exports to the U.S. was an event that was out of its control. <\/p>\n

Responding to the plan that Ms. Joly asked Cliffs to map out, Mr. Simon said that owing to its inability to profitably make galvanized steel anymore, it is proceeding with the idling of its Hamilton Works operation. Laid off workers will have the opportunity to apply for job openings at Lake Erie Works, he said. The local union has said that only 46 positions were available at Lake Erie Works. <\/p>\n

Ron Wells, president of United Steelworkers Local 1005, said he is severely disappointed that Cliffs is proceeding with the layoffs, but it wasn\u2019t unexpected.<\/p>\n

\u201cIt\u2019s not shocking that they are trying to weasel out of the agreement,\u201d he said. <\/p>\n

Mr. Wells says he now wants Ottawa to follow through on its threats and sue Cliffs. <\/p>\n

\u201cI\u2019m sure if it went to court, and hopefully it does, the federal government would prevail,\u201d he said. <\/p>\n

There is precedent for the government to sue and it revolves around the same Canadian steel maker. After U.S. Steel acquired Stelco in 2007, it made commitments under the Investment Canada Act around jobs and production levels. After the financial crisis hit in 2008, U.S. Steel laid off workers in Canada. The federal government later sued the company for allegedly reneging on its legally-binding commitments. A settlement was reached in 2011 with U.S. Steel agreeing to a new set of commitments<\/a>, including around production levels and investment in Canada. <\/p>\n

Cliffs has said it is prepared to immediately call back laid off workers in Canada if Ottawa can reach a \u201cFortress North America,\u201d trade pact with the U.S. but it has also been clear it believes the government has not done enough to reduce foreign dumping of galvanized steel in the country, which is hurting Cliffs\u2019 ability to compete in the domestic market. <\/p>\n

Cleveland-Cliffs boss dismisses idea of nationalizing Stelco as Ottawa pushes to preserve jobs<\/a><\/p>\n

Ottawa has already aggressively cracked down on the dumping of foreign steel into Canada through the imposition of tariff-rate quotas and mandated that publicly funded projects use Canadian steel wherever possible. <\/p>\n

\u201cThe most important step the government could take,\u201d Mr. Simon wrote, \u201cwould be to impose further restrictions on imports of cold-rolled and coated steel products into Canada, limit import substitution, and eliminate remissions for steel products that Canadian producers, including Stelco, can supply.\u201d<\/p>\n

He also took issue with the government\u2019s contention that it was blindsided by Cliffs\u2019 announcements to lay off workers in Canada. <\/p>\n

Cliffs, he said, had been clear, both in its direct communications with Ottawa dating back to July, and in its public comments to investors, that its galvanized business was in trouble and that layoffs in Canada were imminent. <\/p>\n

Opinion: The steel jobs may never come back. Ottawa should consider nationalizing Stelco<\/a><\/p>\n

Furthermore, he said that Ottawa had suggested a meeting to discuss \u201cproposed revisions to the undertakings\u201d owing to the expected idling of the affected Stelco operations. <\/p>\n

\u201cYour suggestion that you only recently learned of Stelco\u2019s intentions to indefinitely idle its Hamilton Works finishing lines is therefore inaccurate and misleading to the Canadian public,\u201d Mr. Simon wrote. <\/p>\n

\u201cBy failing to mention or acknowledge these regular communications, your letter created the false impression that we have not been cooperative and transparent. This is profoundly regrettable at a time when we hope to lower public tensions and engage in a dialogue with you.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Stelco said on Sept. 28 that it was laying off up to 500…\n","protected":false},"author":2,"featured_media":928083,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[901,888,902,879,877,903,45,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-928082","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-business","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/928082","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=928082"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/928082\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/928083"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=928082"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=928082"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=928082"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}