Joly says ‘everything is on the table’ but still no court filing against Stelco layoffs

OTTAWA – Industry Minister Mélanie Joly said “everything is on the table” when it comes to her government’s response to layoffs at Stelco but stopped short of announcing any legal action against the steelmaker.

“We expect Stelco to follow the undertakings that they’ve committed to…the Government of Canada,” Joly told reporters in Ottawa on Wednesday.

“And right now, a business decision or even a change in market conditions cannot be used to not follow the commitment,” she added.

Joly was referring to the commitments made by American-based Cleveland-Cliffs Inc. when it acquired Stelco in 2024.

Joly’s predecessor approved the purchase, following a review under the Investment Canada Act (ICA), which included a commitment to maintain the same amount of unionized employees for a period of five years.

The union representing steelworkers at the Stelco plant in Hamilton has confirmed layoffs are now underway. Layoffs are also expected to take place at Stelco’s Lake Erie Works in Nanticoke, Ont. Stelco has cited U.S. tariffs as the main reason for the “temporary” job cuts.

Last week, the industry minister threatened the “full force of the law” if Cleveland-Cliffs failed to comply with its undertakings that it agreed to when it purchased the steelmaker.

On Wednesday, Joly said she is “always open to sit down with a company and find a solution, but we’re looking at everything that is possible to keep jobs in Canada.”

On Oct. 5, Joly sent a letter to Stelco’s president, and a legal team is reviewing the response from the company, which was received on Friday.

Joly said she has been in contact with the unions and called the layoffs “unacceptable.”

On Tuesday, NDP Leader Avi Lewis and Ontario NDP Leader Marit Stiles called for Stelco to be nationalized.

Joly cited Section 40 of the ICA which could lead to a few possible outcomes from a court process, including financial penalties towards the company, forcing them to abide by the commitment, and forced divestiture.

On Sunday, Cleveland-Cliffs CEO Lourenco Goncalves disputed the government’s claims and told CBC News he was prepared to fight Canada in court.

Notably, this is not the first time Stelco plants have idled due to bad market conditions. U.S. Steel, which acquired Stelco in 2007, began layoffs at the company following the 2008 financial crisis.

The federal government filed a lawsuit against U.S. Steel in 2009 for failing to meet their job commitments when they made the Stelco purchase. The lawsuit resulted in an out-of-court settlement in 2011, with commitments to keep production going by U.S. Steel.

However, U.S. Steel filed for creditor protection and severed ties with its Canadian operations, before those pledges could be followed through on.

National Post

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