US Steel announced on March 3 that it will close its newly acquired steel mills at the Hilton Works in Hamilton, and the Lake Erie Works in Nanticoke, laying off 1500 workers. This is a breach of its contract with Investment Canada, signed less than 18 months ago, in which it guaranteed pensions, jobs and new investment in exchange for the right to buy out the last Canadian-owned steel company.
Steelworkers Local 1005 President Rolf Gerstenberger sharply criticized the federal government for allowing the takeover. He says the government has stood by while first Stelco, and now US Steel, have plundered the Canadian operations, leaving steelworkers, their families and community the victims of a massive corporate shakedown.
“They did it because they could”, Gerstenberger said, adding the labour movement needs more power to stop them. “If they know we’re going to fight for it – that’s our guarantee, that’s what can stop them”.
The union is planning a mass meeting in Hamilton on March 21, to consult with members and determine a course of action which may include sending a delegation to Ottawa. In the meantime, the union is mobilizing community support through public displays like mass protests on Hamilton streets.
Ontario NDP leader Andrea Horwath, who is from Hamilton, is campaigning for a Buy Canadian policy which she says will create a market for Canadian-made steel and send Hamilton steelworkers back to work.
Ontario Communist Party leader Liz Rowley said the federal and provincial government must stop the closure and hold the company to its agreement with Investment Canada.
“This is about Canadian jobs, Canadian sovereignty and the future of manufacturing and secondary industry which requires basic steel and a basic steel industry in Canada,” said Rowley. “Either the federal and provincial government force US Steel to live up to the agreement they signed and keep production in Canada, or better yet they take over the operations and run it as a Crown corporation under public, democratic control.”
US Steel is consolidating its operations in Gary, Pittsburgh, and Birmingham, closing other US plants as well as its Canadian operations.
The Hamilton and Lake Erie operations produce steel used in construction, the auto and appliance industries, and the capital goods sector.
Citing “market conditions” for the indefinite closure, to last until the recession is over, and the breach of the agreement with Investment Canada, US Steel is heading into scheduled contract negotiations with USWA Local 8782 at Nanticoke in a few weeks, and is urging Local 1005 at the Hilton Works to join in. Local 1005’s contract runs until 2010, and they have declined the invitation, while Local 8782 has sought help from USWA International President Leo Gerard in Pittsburgh.
Clearly, the company’s intent is to wrest concessions from the union as a condition for re‑opening its Canadian operations, using the indefinite closure as the battering ram. Wages, which are about $8 an hour higher in Canada than in the US, and the defined benefits pension plan, are in the company’s sights.
US Steel has already declared defined benefit pensions “too costly,” with a $60 million liability annually for 8,000 pensioners in Hamilton. There are only 300 pensioners at Nanticoke, which is less than 30 years old, and is the most productive steel works in North America. Located in a rural area, many of the workers in Lake Erie started their working lives at Stelco. US Steel knows this, and hopes the threat of a permanent closure will scare these workers and break their resolve to refuse concessions.
The hard nut for the company will be the Hilton Works, which has a workforce with a history of struggle going back almost 100 years, including the 1946 strike, which along with the Ford strike in 1945 brought the closed shop to Canada.