Stelco just had its strongest quarter since its takeover, but layoffs are proceeding. The feds say it’s a breach, but the takeover terms and employment standards obligations are different, says a lawyer
Stelco has just had what its owner calls its best quarter since Cleveland-Cliffs bought it, and the layoffs at its Ontario plants are going ahead regardless.
On Monday’s third-quarter earnings call, Cliffs CEO Lourenco Goncalves said Stelco’s results were its strongest since the 2024 acquisition. He attributed the layoffs to a domestic market swamped with imported steel. Industry Minister Mélanie Joly responded by posting on X that Cliffs must “keep jobs in Canada or face the prospect of having to sell” its Canadian assets.
Whether the layoffs breach the takeover terms is far from settled, partly because of how the promise was worded.
When Ottawa approved the $3.4 billion takeover in 2024, the commitment appeared straightforward: for five years, Cleveland-Cliffs would keep at least as many unionized employees, and the vast majority of non-union staff, as Stelco had on the day the deal was announced. That’s how the federal government summarized it at the time.
Two years later, with up to 500 workers in Hamilton and Nanticoke, Ont., being laid off, much of the dispute turns on that one sentence — and the full text has never been made public.
Joly says the layoffs breach the undertakings Cliffs gave under the Investment Canada Act (ICA). In...
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