Stelco says it is going ahead with layoffs at its Ontario operations, despite an ultimatum from the federal government to map out a plan within five business days.
What Stelco told the minister
On Friday, Stelco president and general counsel Paul Simon told Industry Minister Mélanie Joly that the company is proceeding with the layoffs. He also rejected her claim that the cuts breach Stelco's undertakings.
In his letter, Simon wrote: "Your representation that Stelco's planned layoffs cause it to breach its undertakings is false."
Stelco is also proceeding with the idling of its Hamilton Works operation. The company is owned by Cleveland-Cliffs.
How the dispute began
Stelco said on Sept. 28 that it was laying off up to 500 workers in Hamilton and Nanticoke, Ont. Ottawa then issued the Cleveland-based steelmaker an ultimatum to map out a plan within five business days.
The company points to the imposition last year of a 50-per-cent U.S. tariff on Canadian steel exports to the U.S. as the pressure behind its decision.
The union's reaction
Ron Wells, president of United Steelworkers Local 1005, said he is severely disappointed by the company's response.
The local union has also raised a concern about the jobs the company has pointed to elsewhere in its operations. It has said that only 46 positions were available at Lake Erie Works.
Cleveland-Cliffs and the federal response
Cleveland-Cliffs CEO Lourenco Goncalves has said there is no market in Canada for the galvanized steel the company produces there. His words: "There's no market in Canada for the amount of galvanized steel we produce in Canada."
Prime Minister Mark Carney has said the federal government intends to use all its powers and pursue the matter to the fullest extent of the law. His words: "We intend to use all powers that we have and pursue them to the fullest extent of the law."
What is not yet known
The sources do not say what legal steps the federal government will take next, or what penalties it could seek if it concludes that Stelco has breached its undertakings. They also do not say when the layoffs will take effect or how many of the up to 500 affected workers will lose their jobs.
Sources: The Globe and Mail, Canadian HR Reporter
