Court Ruling Validates Overhaul of Discredited Investment Canada Act

TORONTO, May 20, 2015 /CNW/ - The need to overhaul the discredited Investment Canada Act has been reconfirmed by a court ruling that keeps Canadian families and communities in the dark about a secret deal between the federal government and U.S. Steel.

"This decision further underscores how this legislation has been abused by successive Liberal and Conservative governments to benefit foreign multinationals at the expense of Canadian families and communities," said Ken Neumann, National Director of the United Steelworkers (USW).

"The judge in this case confirmed that it is reasonable and potentially beneficial for Canadian workers and pensioners to have access to details of the secret deal between the government and U.S. Steel," Neumann noted.

"However, the judge's hands are tied because the act allows the government and foreign investors to keep the public in the dark about these secret deals. It's time to overhaul this legislation to defend the rights and interests of Canadian workers and communities."

Canada's Conservative government struck a secret deal with U.S. Steel in 2011. The government then dropped its legal challenge of U.S. Steel's broken commitments – made under the Investment Canada Act – on production and employment levels at its operations in Hamilton and Nanticoke.

As part of the U.S. Steel bankruptcy protection case now underway, the USW petitioned the Ontario Superior Court to unseal the 2011 secret deal.

The USW argued it is crucial that details of the secret deal be provided to key stakeholders in the bankruptcy protection case, particularly the thousands of pensioners and workers whose pensions and jobs are in limbo. The City of Hamilton made the same request.

The union and the city told the court they "require disclosure of the settlement agreement at this time to be able to participate meaningfully and effectively in the (bankruptcy protection) negotiations and discussions that are currently underway."

In his ruling released yesterday, Superior Court Justice Herman Wilton-Siegel stated the union's request "is reasonable and understandable."

However, the judge said he cannot override Investment Canada Act provisions, particularly since the federal government and U.S. Steel insist on keeping the deal secret.

"The court has no authority to override these provisions regardless of its views as to the potential benefits of disclosure in the present circumstances," the judge said.

"This is another condemnation of Conservative and Liberal governments that have used the Investment Canada Act to benefit foreign corporations while treating Canadian pensioners, workers and their families with contempt," said Marty Warren, the USW's Ontario Director.

"This legislation is supposed to guarantee a 'net benefit' to Canada when foreign corporations take over our natural resources and industries. In reality, there is a net disregard for Canadian jobs, workers and communities, while foreign corporations get the benefits," Warren said.

"It's clear – to everyone except the federal government and U.S. Steel – that our members, our pensioners and our community deserve to know the details of this secret deal," said Gary Howe, President of USW Local 1005, representing employees at U.S. Steel's Hamilton operations.

"We don't trust U.S. Steel or this government to do what's best for us and for our community and that distrust has been reinforced once again."

"It's outrageous that the federal government is content to preserve legislation that so blatantly favours foreign multinationals while treating Canadian workers and communities with contempt," said Bill Ferguson, President of USW Local 8782, representing employees at U.S. Steel's Nanticoke operations.

SOURCE United Steelworkers (USW)

Gary Howe, President, USW Local 1005, 905-531-4078, [email protected]; Bill Ferguson, President, USW Local 8782, 905-537-8782, [email protected]; Ken Neumann, USW National Director, 416-544-5951; Marty Warren, USW Ontario Director, 416-243-8792; Ken Rosenberg, Counsel to USW, 416-646-4304, [email protected]; Bob Gallagher, USW Communications, 416-544-5966, 416-434-2221, [email protected]