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Union boss upset over Tenaris layoffs despite talk of new hires, expansion

Sault tube mill gets turned on and off like a light switch, union president says
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Tenaris file photo. Darren Taylor/SooToday

The benefits of recent funding announcements for expansion of Tenaris Algoma Tubes Inc. don’t seem to be readily apparent, as many tube mill workers are currently laid off, with a large number of production team workers scheduled to be laid off for the week of April 12.

“The one-week stoppage is due to a delay in the shipment of steel billets, the raw material needed to produce our pipes, due to a supply issue beyond Tenaris’s control,” wrote Guinevere Basnight, Tenaris senior communications director (North America) in an email.

“The company’s saying it’s because they didn’t plan ahead to make sure we had the steel and couplings to make the tubes we need,” said Cody Alexander, United Steelworkers (USW) Local 9548 president, speaking to SooToday Thursday.

The company informed workers of the latest lay off development March 12, the union president said.

“We’re fighting back against that, basically saying they mismanaged our resources, and there’s no reason to lay off the 160 people they’re planning to lay off. Our concern is that it’s basically an embarrassment for us in the community because of the hiring announcements."

In December, Sault MP Terry Sheehan announced Tenaris Algoma Tubes Inc. will receive $5 million in FedNor funding for expansion and upgrades for the company's Sault Ste. Marie tube mill.

That funding was expected to create 75 full-time jobs as well as an additional 50 jobs during the construction phase by the end of 2021. 

The provincial government announced $9 million in funding for the steel-pipe manufacturer to expand production capacity and create jobs locally.

As reported earlier by SooToday, documents prepared for a November City Council meeting showed Tenaris is planning to spend $70 million to $80 million into its local "industrial transformation project."

“We’re super disappointed about it because we think they should keep the guys working regardless if we have those resources,” Alexander said of the upcoming week-long layoff.

“We did call EI and they can waive the waiting period for our members. That doesn’t make it any better but definitely helps mitigate their losses.”

Alexander said there has been a core group of approximately 220 workers lately, about 165 of them production workers, the others being maintenance workers.

“For us (the layoff decision) doesn’t make sense. They (Tenaris) are already getting a percentage of the wages from the government and they’re nickel and diming us but at the same time, in the community, they’re saying we’re building a super mill that’s going to offer all these jobs,” Alexander said.

“Our concern is they’re trying to make us a light switch mill, where they just turn us on and shut us off, send the guys home when they don’t need us and bring us back when they do, and for us it’s not good for building a family, it’s not a good career. It’s basically going backwards as far as we’re concerned.”

“When we’re running at full production we’re between 450 to 500 people, but with them opening a mill in Texas and they’re importing from Mexico, we’re like the overflow mill. We only get orders if those ones are at capacity. Tenaris has a lot of flexibility to import from wherever they want because they own so many mills around the world, and it’s difficult for us to attract this (production orders), to fight against it. We have been successful with getting some products brought to the Sault because we argued about it, and that's what we’re continuing to do,” Alexander said.

The union president said May 2018 marked the last time more than 450 people were working at the local mill before getting hit with tariffs.

Those tariffs, imposed by the U.S. in June 2018, included a 25 per cent tariff on imports of Canadian steel and a 10 per cent tariff on imports of Canadian aluminum under Section 232 of the Trade Expansion Act.

Though those tariffs, and Canadian countermeasures, were eliminated in May 2019, Alexander said “we haven’t recovered since then.”

Alexander said “(currently) we have 210 working (with 160 to be laid off for the week of April 12) but we (already) have 115 on layoff (for a total of 325 employees)...we’ve had a lot of people go through our membership through being hired and then laid off.”

Alexander said he hopes those 160 workers will be called back for the week of April 19.

“We were supposed to have our new hires...they’re hiring right now (conducting job interviews) while they’re laying us off. As a union, we’re asking ‘should we even be hiring?’ because all they’re basically doing is making more people dependent on this company, who are quitting other jobs to come here when it’s not reliable. If they don’t have couplings or tooling they’re just going to send the whole production team home with no thought to the consequences for the workers' families and the community.”

The union president said letters of protest have been sent by (USW) Local 9548 to Tenaris management. 

“We stand committed to the investments we announced last year, with a long-term approach to manufacturing in Canada and to the Sault Ste Marie community...We are taking advantage of this situation to complete preparations for the next phase of investment at the facility. We are also working to retain as many employees as possible to prepare for the ramp up, including offering training opportunities for the team,” wrote spokesperson Guinevere Basnight on behalf of Tenaris.