Cliffs unit is said to proceed with Canada layoffs despite govt. ultimatum

Cleveland-Cliffs’ (CLF) unit Stelco has informed the Canadian government that it is proceeding with hundreds of job cuts at its production sites in Ontario despite an ultimatum issued by Ottawa earlier this week to avoid the layoffs, the Globe and Mail reported on Saturday.

On Sept. 28, Stelco announced plans to lay off up to 500 steelworkers in Hamilton and Nanticoke, Ont., noting that it couldn’t operate profitably mainly due to the impact of elevated U.S. tariffs on Canadian steel.

When the federal government approved Cliffs’ (CLF) $3.4B acquisition of Stelco in 2024, the Cleveland-based steelmaker agreed to several legally binding terms, including a condition to maintain at least the same number of unionized workers in Canada for five years.

On Monday, Canadian Industry Minister Mélanie Joly issued a five-day ultimatum forcing the company to come up with a plan to comply with its employment guarantees under the Investment Canada Act or face possible legal action.

Citing a legal provision related to the pledges and the government’s ICA guidelines, Stelco’s president and general counsel Paul Simon said in a letter to Joly that the company has not breached its commitments.

A spokesperson for Joly confirmed receiving the letter.

“Your representation that Stelco’s planned layoffs cause it to breach its undertakings is false,” Simon said in the letter, implying that tariffs could allow non-enforcement or renegotiation of the commitments.

“Throughout the history of the Investment Canada Act and its predecessor foreign investment acts, it has consistently been understood that changes in circumstances may necessitate the non-enforcement or renegotiation of undertakings,” Simon added.