The Stel Salaried
Pensioners Organization wishes to thank The Hamilton Spectator for permission
to post the following article by Reporter Tara Perkins published in the
February 19, 2004 edition
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Feb. 19, 2004. 12:42 AM |
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McGuinty offers 'role' in helping |
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STELCO IN CRISIS; Vows to support study of hard-hit
industry |
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By Tara Perkins |
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Premier Dalton McGuinty offered beleaguered steelworkers his sympathy but little else at a Queen's Park meeting yesterday. McGuinty sat down with union executives and the presidents of Stelco's two largest locals to talk about Stelco's collapse into bankruptcy protection and the Canadian industry's condition. The premier offered no direct action, but promised his support on a proposed federal-provincial committee to study the hard-hit industry. McGuinty said he understood the concerns workers at Stelco have about their jobs and the impact the company's restructuring will have on their families and community. "I want to get a sense of their take on the broader issues as well about what's happening to the steel industry, not only in Canada but North America, and what role they think we might play in helping to turn that industry around," he said before the meeting yesterday. "It's too early to make a call as to exactly the role that we want to be playing but we do want to help." Lawrence McBrearty, Canadian director of the United Steelworkers of America, said he got what he expected. "This was not a meeting about the specifics of current bankruptcy protection proceedings for companies such as Stelco and Slater... (it) was about the larger picture of how we revive and maintain the steel industry over the next five to 10 years." Also yesterday, Stelco reported that it is seeking an extension of its court protection until May 28. The current order expires at midnight on Feb. 27. James Arnett, a former Molson CEO who has been appointed to advise McGuinty on Stelco, was not present. Union leaders meet with Arnett this afternoon in Toronto. Hamilton MPP Marie Bountrogianni, who was also at the Queen's Park meeting, said the premier plans to start consultative meetings next week about the committee, which would include representatives from the federal and provincial governments and examine everything that affects the steel industry. "As we see it, the key areas that need to be addressed are trade, access to capital, pension security, skills training and adjustment," McBrearty said. "The federal government did not take action on the tariff issue, and we have the consequences today. "We're going to need action from everybody, including Paul Martin." Also attending the meeting were Steelworkers' Ontario/Atlantic Director Wayne Fraser and presidents of four Steelworker local unions, representing Montreal-based Ivaco Corp. and Mississauga-based Slater Steel, as well as Stelco. McBrearty said the union is not looking for any money from the province yet. The province has a big stake in the restructuring of steel companies. For example, if Stelco goes bankrupt, its employees and retirees are eligible to claim $773 million from a provincial Pension Benefits Guarantee Fund, according to Stelco. The fund only held $222 million at the end of 2003. During the last decade, some large companies, including Stelco, were allowed to skip payments to top up pension funds because it was thought big companies would not go bankrupt. That "too-big-to-fail clause" has now affected Algoma, General Motors and Stelco, Bountrogianni said. Although the clause was changed in 2002, the province "grandfathered" pension plans that had been under it for a long time, including Stelco's, so those companies still aren't required to fund pension deficits. When Algoma went through bankruptcy protection in 2002, former premier Mike Harris cut the company a deal. That allowed it to eliminate guarantees for active employees in a bid to help the company avoid bankruptcy. Bill Ferguson, president of Steelworkers Local 8782 at Lake Erie Steel, said Stelco is responsible for its pension woes. He said the company failed to keep up payments and is now using bankruptcy protection to clean up its mess. McGuinty appeared to be surprised at yesterday's meeting by how bankruptcy protection works, Ferguson said. The premier did not realize how much power the judge has to terminate contracts, he added. Scott Duvall, head of Stelwire's Local 5328, said McGuinty was also surprised to learn that workers are not receiving severance payments now because of the Companies Creditors Arrangements Act. But the premier was well-briefed on the steel industry, Ferguson said. However, the union is not getting too cranked up yet. "We're not excited right now," said Rolf Gerstenberger, head of Hilton Works Local 1005, adding that the steelworkers need to wait and see if the government really takes action. "A politician is a politician, right?" Stelco announced yesterday that it will close its CHT Steel Co. Inc. unit, based in Richmond Hill. CHT processes steel plate made in Hamilton. About 200 workers at Welland subsidiary Stelpipe were given notice earlier this week warning them they could be laid off by mid-April. Because employees are unionized, the company must give the workers warning, said Tim Huxley, vice-president of corporate affairs. He said this move is not associated with bankruptcy protection, but resulted from steel supply issues. tperkins@thespec.com 905-526-4620 |