The U.S. owner of Stelco has been given a deadline by Ottawa to present a plan within five business days that ensures the preservation of jobs at the Hamilton steelmaker. Failure to comply may result in legal action. Cleveland-Cliffs, based in Ohio, announced intentions to lay off up to 500 workers and halt specific steel production at Stelco, which the federal government argues breaches the commitments made during the company’s acquisition in 2024.
In a letter to Stelco’s president, Paul Simon, Industry Minister Mélanie Joly emphasized the government’s readiness to enforce the agreement under the Investment Canada Act through court intervention if necessary. Joly stressed the significance of upholding commitments, highlighting potential remedies for breaches such as directing compliance, divestiture, or imposing monetary penalties.
The acquisition of Stelco by Cleveland-Cliffs in a $3.4 billion cash-and-stock transaction aimed to prioritize national interests and recognize the importance of the workforce. According to Joly’s letter, the agreement includes commitments to maintain the same number of unionized and non-unionized employees as at the time of the acquisition announcement.
Cleveland-Cliffs’ CEO, Lourenco Goncalves, defended the layoffs as essential and justified due to the impact of the Canada-U.S. trade war on Stelco’s steel sales to the U.S., citing it as a fundamental aspect of the deal. Prime Minister Mark Carney affirmed the government’s stance to utilize all available legal measures against Cleveland-Cliffs in response to the situation.
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