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Essar strike talk 'not helpful to anyone,' judge says. Da Prat hopeful for favourable decision

'We've always co-operated and worked with the company to restructure. We're prepared to do it again' - Mike Da Prat, United Steelworkers Local 2251
2014-04-07 Essar Steel Algoma 007
Essar Steel Algoma: File photo by Kenneth Armstrong/SooToday

In a Toronto courtroom yesterday, Essar Steel Algoma Inc. indicated it will not seek a no-board report.

At least, it won't seek a no-board report before a scheduled court hearing on Feb. 7 decides whether the company is allowed to do so under federal insolvency law.

What's a no-board report?

Why is it important?

Provincial labour law requires union and management to use the government's conciliation services before engaging in a strike or lockout.

At any time after an initial meeting with the conciliator, either union or management may request a no-board report, indicating that differences can't  be resolved and no conciliation board should be appointed.

A lockout or strike is legally possible on the seventeenth day after a no-board report is issued by the Ontario Ministry of Labour.

Essar Steel Algoma's largest union, United Steelworkers Local 2251, became very concerned earlier this month when the company served notice that it may seek a no-board report and unilaterally impose contract terms some time late next month.

Local president Mike Da Prat told a series of emergency closed union meetings last week that the terms to be imposed include a 10 per cent wage reduction, elimination of cost of living increases, reduction of paid vacation and other cuts.

"If the company requests a no-board report, we have to take a strike vote," Da Prat told SooToday on Friday.

That kind of talk isn't sitting well with Justice Frank Newbould, the Superior Court judge presiding over Essar Algoma's restructuring proceedings under the Companies' Creditors Arrangement Act.

"It is extremely unsettling to a restructuring process for union officials to be publicly discussing a possible strike," Newbould said yesterday.

"It is affecting the business of Algoma and that is not helpful to anyone, including the employees. I urge the parties to have meaningful negotiations of the issues surrounding a collective agreement and leave public discussion of the negotiations or threats of action out of it."

"The parties have agreed to toll the time until the motion is determined for an application for judicial review."

Outside the courtroom, Da Prat is now careful to avoid uttering the "s" word.

But he insists he has no choice but to communicate to his local's 2,100 members through news media like SooToday, because Essar Algoma is controlling access to in-plant bulletin boards and the corporate email system.

"The CEO has to approve anything on the internet. Local 2251 has to use the media to communicate with its members in real time. We have no way of doing it any other way," Da Prat says. 

The union usually has two or three months to organize for a labour disruption.

If the company obtains a no-board report, Local 2251 could get hardly a month to do all the things necessary to prepare for a strike: organizing special membership meetings and committees, meetings with police regarding permits, meetings with city staff regarding property boundaries, notifying residents of traffic issues, locating strike trailers and other infrastructure.

"We have to figure out how we're going to sign 2,100 checks a week. We have set up all the mechanics. We need to do what we need to do to be ready."

"At Local 2251, our last strike was in 1990. We've always co-operated and worked with the company to restructure. We're prepared to do it again," Da Prat tells SooToday.

This afternoon, Da Prat advised us that information regarding the negotiations will also be shared on the Local 2251 website.

Da Prat says he's optimistic for a favourable court decision on Feb. 7.

Meanwhile, on Monday, Sault Ste. Marie City Council approved an additional $50,000 retainer for the lawyers representing the city at Essar Steel Algoma's insolvency proceedings.

Essar owes the city more than $21 million in unpaid property taxes.

The city's legal department originally asked for an additional $75,000 on top of the $225,000 already spent trying to collect the taxes owed, but the amount was reduced after Ward 6 councillor Ross Romano introduced the following motion:


Mover: Ross Romano

Seconder: Marchy Bruni

Whereas council has been asked on January 23, 2017 to approve a further retainer payment to our legal counsel assisting us in the CCAA proceedings involving Essar Steel Algoma in the amount of $75,000, in addition to the $225,000 already paid; and

Whereas it is prudent of this council to be cautious of unnecessary and fruitless spending that may offer no legitimate return on investment to the residents of the City of Sault Ste. Marie; and

Whereas any indication by the Corporation of the City of Sault Ste. Marie that we should be prepared to negotiate on the repayment of the taxes owed to us, for which we already hold priority status by virtue of statutory authority for said priority would be detrimental to the city being able to actively pursue the full amount of tax arrears presently owing to the City; and

Whereas this council has never seen any accounts from our legal counsel that explains on a line-by-line basis, the costs that we have expended to date that appear, based on the January 23, 2017 request from staff to have reached $225,000 of Sault Ste. Marie tax payers money; and

Whereas said accounts should be reviewed to ensure we as a council make an informed decision as to what we can hope to receive for the further expenditure of an additional $75,000 and how our last $225,000 has been spent,

Therefore be it resolved that in the spirit of providing openness and transparency to the taxpayers of Sault Ste. Marie, which we serve, that this request for a further $75,000 be deferred and that staff provide Council at our next meeting with:

  • a copy of the detailed itemized line-by-line accounts that have been provided to the Corporation of the City of Sault Ste. Marie from our legal counsel; and
  • a copy of our retainer agreement(s); and
  • a copy of the correspondence and opinion letter from our legal counsel advising us as to the costs associated with any potential future steps or options moving forward and costs of same.