U.S. Steel Canada plant near Nanticoke, Ontario. The steelworkers union, which represents employees at the company’s mills in Hamilton and Nanticoke, Ont., has said it will seek an injunction to stop the shift of production to the U.S.Fred Lum/The Globe and Mail
Salaried employees and retirees of U.S. Steel Canada Inc. want the Ontario Superior Court to order the steel maker's parent to halt any moves to shift steel production out of Canada until after a mediation session.
A plan by United States Steel Corp. to shift production of high value-added steel from Hamilton and Nanticoke, Ont., to U.S. mills has brought a year-long battle between the Pittsburgh-based giant and its stakeholders to a head.
After the United Steelworkers union became aware the company was planning to move production of about 180,000 tons of steel, it sought an injunction to halt the transfer.
U.S. Steel Canada has responded with threats to cease production entirely by the end of the year unless it is able to cut off health-care benefits for more than 20,000 retirees and dependents and halt all municipal tax payments.
The salaried employees and retirees argue the company should be prevented from taking any action on production until a hearing is held on the union's application for an injunction. That hearing is set for later this month after three scheduled days of mediation.
U.S. Steel Canada has been operating under the court protection of the Companies' Creditors Arrangement Act since September, 2014.
But its parent company "did not obtain the approval of this court for the USS plant loading [production transfer] nor did USS bring any motion before this court for approval of the USS plant loading," the salaried employees and retirees said in a notice of motion submitted to Justice Herman Wilton-Siegel, who is overseeing the case.
"Despite numerous requests, USS has refused to stand still with the U.S. plant loading and continues to proceed with the U.S. plant loading," the notice of motion said.
A standstill order is required because the production shift damages U.S. Steel Canada financially and impairs the environment for the mediation sessions, lawyers for the salaried employees and retirees said in a separate court filing.
U.S. Steel has refused to stand still despite requests during case conferences with the judge that it do so, Gary Dallin, a member of the salaried employee and
retiree group said in an affidavit.
Switching orders between Canadian and U.S. plants can be done easily, so any argument that actions need to be taken now makes no sense, Mr. Dalling said.