Stelco to Bring Back 175 Laid Off Workers Following Pressure From Ottawa

Canadian steelmaker Stelco has announced it will recall all 175 workers laid off at its Hamilton plant and compensate them retroactively, ending a weeks-long confrontation between workers, the Canadian government and the company's owner in the United States.

The announcement on Friday came shortly after Industry Minister Melanie Joly warned she would pursue a court order to force Cleveland-Cliffs to sell Stelco unless the company's management responded by the end of the day.

In a statement, the company said it had secured agreements with enough customers to restart its finishing operations, with workers set to return on December 1. The recalled employees will receive back pay covering the standard wages they would have earned during the layoff period.

Ron Wells, president of United Steelworkers Local 1005, welcomed the decision and credited pressure from workers, the union and the government for the outcome. Speaking at a news conference, he described the layoffs as “illegal” and “immoral” and said they should never have happened.

Joly appeared alongside Wells and said the resolution sent a signal to investors that Canada is “a country of the rule of law and that the law applies to everyone, notwithstanding the size of your wallet.” She added: “This fight was absolutely worth it.”

Cleveland-Cliffs, which acquired Stelco in 2024, said in late September that as many as 500 workers would be laid off at the company's plants in Hamilton and Nanticoke, Ontario. It cited weak demand and difficult market conditions for cold-rolled and coated steel products, which are used in goods ranging from cars to appliances.

The company blamed US President Donald Trump's tariffs on Canadian steel, which raised the cost of its products in the American market, as well as competition from cheaper foreign steel that it said was cutting into domestic demand for Canadian steel.

Ottawa countered that the layoffs breached binding commitments Cleveland-Cliffs made when purchasing Stelco, including a pledge to maintain the same number of Canadian unionised employees through 2029. The government and the union also argued that chief executive Lourenco Goncalves broke a commitment to advocate for policies benefiting the steel industries in both countries when he publicly backed Trump's steel tariffs, including those hitting Canada. That open support raised questions, given that Goncalves also pointed to the tariffs as a cause of Stelco's financial difficulties.

In its statement, Cleveland-Cliffs said its customers had committed to supporting the Hamilton operations “despite the lack of response from the federal government to address the shortfalls in their tariff response program.” The company offered no details about the customer agreements and did not explain what had changed to make restarting operations viable. It did not respond to a request for comment.