Canada requires Cleveland-Cliffs to submit a plan to save jobs at Stelco

Canadian Industry Minister Melanie Jolie has given the American company Cleveland-Cliffs Inc. five working days to submit a plan showing how its Canadian subsidiary Stelco Inc. will fulfill the obligations it assumed when the federal government approved the acquisition under the Canada Investment Act (ICA) in 2024, or face a potential lawsuit.

According to media reports, in a letter sent on October 5 to Stelco president Paul Simon, Joly stated that the company's plan to indefinitely suspend production of cold-rolled and coated steel at the Hamilton Works plant would contradict these initial commitments. The commitments require that, for a period of five years, the company retain at least the same number of unionized employees and the vast majority of non-unionized employees in Canada who were hired at the time the deal was announced. Jolie stated that the commitments remain valid even if the business strategy or market conditions have changed.

If Cleveland-Cliffs does not comply with the requirements, the government can appeal to a higher court, which can oblige the company to fulfill its obligations, impose monetary fines or order the sale of the business. On October 7, Jolie announced that Ottawa had not yet received a response from Stelco.

On September 28, Stelco announced that it was suspending operations in Hamilton indefinitely and that the company was producing concentrate on Lake Erie in Nanticoke, Ontario. referring to the US tariffs. The layoffs will begin on October 9 and will affect up to 500 employees, while United Steelworkers (USW), Local 1005, estimates 350 steelworkers will be laid off.

Cleveland- Cliffs acquired Stelco for 3.4 billion Canadian dollars in cash and shares. The deal was completed in November 2024. In 2009, the Government of Canada took over from the previous owner of Stelco, the United States Steel Corporation, went to court over employment agreements concluded under the ICA, and the case was settled in 2011 after the company agreed to a new set of obligations.