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- calendar_today October 22, 2026
Ottawa Issues Deadline to Stelco Owner Over Alleged Commitment Breaches
The federal government has given Cleveland-Cliffs, the U.S.-based owner of Stelco Inc., 15 days to address alleged violations of binding commitments made during the 2024 acquisition of the Ontario steelmaker. If the company does not comply, it could face legal action, including forced divestment, court orders, or fines.
Industry Minister Raises Employment and Industry Concerns
In an 11-page letter issued Thursday, Industry Minister Mélanie Joly accused Cleveland-Cliffs of failing to uphold six binding commitments to the Canadian government. These commitments include employment guarantees, which were stipulated as part of the company's agreement when acquiring Stelco. Joly's letter demands that Cleveland-Cliffs address the alleged violations, provide proof of compliance, or explain any failures to meet the obligations.
Potential Remedies and Legal Action
If Cleveland-Cliffs fails to address the concerns raised, the government may seek remedies through a superior court. Possible outcomes include an order requiring the company to divest its control of Stelco, enforce compliance with its commitments, or impose daily fines of up to $10,000 for continued non-compliance.
Union Reaction to Government Steps
Ron Wells, president of United Steelworkers Local 1005—which represents workers at Stelco’s Hamilton plant—expressed support for Minister Joly's letter. "She did a good job of explaining our position," Wells said. "We support the letter … we just wish the process could be faster because unfortunately our members are on the street."
Allegations of Advocacy for U.S. Tariffs and Impact on Workers
Minister Joly also accused Cleveland-Cliffs of supporting U.S. tariffs on Canadian steel, contradicting its commitment to the Canadian steel industry. According to the letter, Cleveland-Cliffs has advocated for tariffs and then cited them as justification for layoffs at Stelco. The letter referenced written testimony from CEO Lourenco Goncalves to the U.S. Congressional Steel Caucus, where he supported the potential collapse of the current free trade agreement and prioritized U.S. manufacturing over Canadian interests. Goncalves stated that since acquiring Stelco in 2024, the company blocked Stelco from selling steel into the U.S. market and suggested optimism that the U.S.-Mexico-Canada Agreement (USMCA) might not survive its upcoming review.
Layoffs and Calls for Import Restrictions
On September 28, Cleveland-Cliffs announced plans to lay off up to 500 workers at Stelco’s Hamilton Works and Lake Erie Works in Ontario. The company cited the impact of U.S. tariffs and market conditions, arguing that Canada’s galvanized steel market cannot support two domestic producers—Stelco and ArcelorMittal Dofasco—alongside steel imports. Cleveland-Cliffs has urged the government to tighten import restrictions to bolster the domestic steel industry. Ron Wells accused the company of using layoffs as leverage to pressure Ottawa, stating, "They took this extreme approach to try to put pressure on Ottawa and use our members as pawns to try to blackmail the government into adjusting imports."
Details of Employment Commitments and Previous Breaches
The government letter detailed the specific employment commitments made by Cleveland-Cliffs. These included maintaining an annual average of at least 1,766 full-time-equivalent unionized positions and 603 full-time-equivalent salaried roles. It also revealed that concerns about compliance predate the recent layoff announcements, noting that in November 2025, Cleveland-Cliffs admitted to breaching agreements related to educational programs and charitable contributions.
Stelco's Operations in Ontario
Stelco operates two main facilities in Ontario. The Lake Erie Works plant produces hot-rolled steel used in construction and manufacturing, while the Hamilton Works facility processes steel into specialty products such as cold-rolled and galvanized materials for use in the automotive, appliance, and construction industries.
This report by The Canadian Press was first published on October 22, 2026.
Source: halifax.citynews.ca.
