Stelco Layoffs Put Cleveland-Cliffs' Canadian Assets at Risk

By Tahani Elghazaly
Published October 22, 2026

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Cleveland-Cliffs, the American steelmaker that supported U.S. tariffs on Canadian steel, is facing a 15-day ultimatum from Ottawa after citing those same trade barriers to justify hundreds of layoffs in Ontario.

In a formal notice issued Thursday, Industry Minister Mélanie Joly accused the company of violating employment commitments made when it acquired Stelco in 2024. The dispute affects up to 500 workers at the steelmaker's Hamilton and Lake Erie operations.

Joly's 11-page letter raises a particularly contentious issue: Cleveland-Cliffs publicly advocated for U.S. trade restrictions that it now identifies as a reason for cutting Canadian jobs.

The company rejects Ottawa's allegations, arguing that deteriorating market conditions and weaker demand have forced it to scale back operations. It also maintains that its acquisition agreement does not prohibit layoffs outright.

But federal officials say the employment guarantees were legally binding conditions of the takeover.

Cleveland-Cliffs has been given 15 days to address the alleged breaches, demonstrate compliance or explain why it has failed to meet its commitments.

If the dispute remains unresolved, Ottawa could seek a court order requiring compliance, financial penalties of up to C$10,000 per day or the forced sale of the company's Canadian assets.

The United Steelworkers union welcomed the government's intervention but expressed frustration over the pace of the process, with some employees already out of work.

The deadline now puts Cleveland-Cliffs under pressure to resolve its dispute with Ottawa while affected steelworkers face continued uncertainty over their jobs.