Steel Mills

USSC Retirees Appealing Court Decision on Benefit Suspension

September 18, 2016

Retirees of US Steel Canada are appealing the decision by the Ontario Superior Court to uphold the suspension of benefits to former workers at Hamilton and Lake Erie Works.

A new report by the Monitor assigned to the CCAA proceedings shows US Steel Canada has more cash available than projected–$160 million at the end of July. Lawyer Andrew Hatnay says $3.6 million per month is needed cover costs for retiree health benefits.

“Given USSC’s cash position, paying that amount will not impair USSC in any way in its operations or restructuring efforts,” Hatnay argued in the court appeal. “Conversely, not reinstating health benefits causes significant hardship and prejudice to employees.”

The City of Hamilton has joined with US Steel Canada pensioners and USW Local 1005 to call for an inquiry into the CCAA process that has denied healthcare benefits to retirees.

Sam Merulla, Ward 4 councilor, said the city’s motion may not sway the court but it does offer moral support to the hundreds of Hamilton retirees who have been impacted by loss of coverage.

USSC reported ending cash of $160.1 million at the end of July, compared to $131.4 million at the end of June. The chart below, from the 30th Monitors Report, shows the forecast of the Independent Business Plan (IBP) compared to actual results.

USSC July Financial Results

USSC is expecting positive results for August but forecasts declining sales volume and pricing for the balance of the year. USSC is concerned about the possible redirection of steel imports into Canada as a result of U.S. antidumping cases and about the general uncertainty of price direction for the coming months.

In a Sept. 12 YouTube report, USW Local 8782 president Bill Ferguson noted that orders at the mill, and the industry in general, are currently soft due to price fluctuations. Regarding a conclusion to the CCAA restructuring proceedings, Ferguson said he has been told, “We should have results before the snow flies.” He added, “Hopefully long before the snow flies.”