Steel Mills

Essar Steel Algoma Offer to Union May Result in a Strike

January 22, 2017

Another complication has hit Essar Steel Algoma in its efforts to restructure and pull its way out of CCAA protection. The United Steelworkers Local 2251 has been offered a new contract that asks hourly workers to accept a 10 percent wage cut, elimination of cost of living increases, and cuts to paid vacations. The local union president says a strike vote is likely.

According to Soo Today, USW local president Michael Da Prat said the company has notified the Local that it may seek a “no-board report” and unilaterally impose contract terms around Feb. 20 if the contract is not accepted.

Da Prat said the company is not bargaining in good faith. De Prat said Local 2251 notified Algoma it would commence bargaining on May 3, 2016. Nothing was done by the company because of talks to secure a new owner.

“Out of the blue, on Jan. 9, they’re claiming that the notice to bargain was made in 2016 and it’s still in effect,” said Da Prat, giving Algoma the opportunity to declare failure to resolve differences and call for a no-board report.

“Once the no-board report is issued, there are 14 days before the company can lock out, the union can strike, or there could be terms imposed unilaterally by the company,” he said in the Soo Today interview.

“Once the no-board report is issued, we will definitely be calling a vote. Now, we have to put in motion all those issues and practices that are required for a strike.”

“Under normal conditions, the notice is given three months in advance of the collective agreement expiring. There’s time to do these things. Right now, the timeline is so tight that we have to start right away.”

Algoma steel workers have not been on strike since 1990 when it was owned by Dofasco. That strike lasted 110 days and the following year the Algoma mill entered Companies Creditors Arrangement Act protection. The company endured two other CCAA periods under Essar Global, with the current one beginning in November 2015.

Essar Steel Algoma is currently working out a deal to sell the mill to the Term Loan Bidders. The union has continued to lobby for Essar Global backed Ontario Steelworks to be allowed to compete in the bidding. Algoma rejected the bids from both Essar Global and Ontario Steelworks and has filed an oppression claim against its former parent. The union is prohibited from restarting talks with Ontario Steel.