Canada’s Industry Minister Mélanie Joly has warned U.S.-based Cleveland-Cliffs that Ottawa is prepared to take legal action if the company fails to honour its employment commitments following its acquisition of Stelco.
The warning comes as Stelco plans to lay off up to 500 workers at its Hamilton, Ontario, steel plant, with the company pointing to U.S. tariffs and challenging market conditions as factors behind the planned cuts.
Joly said Wednesday that Cleveland-Cliffs cannot use the ongoing Canada-U.S. trade dispute to justify breaking commitments made when it acquired Stelco in 2024 under the Investment Canada Act.
The federal government’s approval of the takeover was conditional on Cleveland-Cliffs maintaining the number of unionized jobs and the majority of non-union positions at the steelmaker. Joly said those commitments remain legally binding despite changes in market conditions or business strategy.
The minister has demanded that Stelco provide Ottawa with a plan explaining how Cleveland-Cliffs intends to meet all of its obligations, including its commitment to maintain more than 1,500 jobs.
Joly said the federal government had not received a response to the letter she sent Stelco president Paul Simon on Monday. She warned that Ottawa would pursue enforcement measures if the company fails to demonstrate how it will comply with the conditions attached to the acquisition.
“If not, we will use the full force of the law,” Joly said, underscoring the government’s determination to enforce the employment commitments.
The dispute has intensified amid continuing tensions over U.S. tariffs on Canadian steel. Cleveland-Cliffs CEO Lourenco Goncalves has publicly supported U.S. steel tariffs, while the company has attributed the planned Stelco layoffs to tariffs and broader market pressures.
Joly argued that Cleveland-Cliffs cannot characterize the situation as an unavoidable event beyond its control while its chief executive has publicly backed the tariffs affecting the industry.
The planned reductions are expected to affect workers at Stelco’s Hamilton facility, where some production operations are being curtailed. The company has indicated that it will concentrate steel production at its Nanticoke, Ontario, facility and that some affected workers could be offered positions there.
The federal government’s intervention puts the employment commitments made during the 2024 Stelco takeover at the centre of a growing dispute between Ottawa and the U.S. steelmaker.
Swifteradio.com
