Court monitor backs U.S. Steel proposal to suspend retiree benefits
'Critical week' looms for U.S. Steel retirees as benefit payments at stake
A local steelworker union head is seeing red — but is not surprised — by a court monitor report that backs the proposal by U.S. Steel Canada to suspend health care benefits to pensioners.
The unfortunate (but inevitable) fact is that USSC does not have access to liquidity or financing to honour these obligations.- Court monitor Alex Morrison
The court-appointed monitor has agreed in a report Oct. 2 with the steelmaker that it will have to stop operating soon if it doesn't implement financial measures that include suspending payments for other employment benefits to pensioners (OPEBs) and some pension benefits.
The monitor also agrees hat USSC needs a reprieve from its property taxes. Both are allowances USSC has requested as it seeks extension of its Companies' Creditors Arrangement Act (CCAA) bankruptcy protection, which is scheduled to end in December.
The monitor's report is disappointing, said Gary Howe, president of the United Steelworkers Union Local 1005. But it's not unexpected.
"In every single monitor's report, they've steered the way of U.S. Steel Canada," Howe said.
The scheduled court appearance on Wednesday and Thursday, where USSC will argue in favour of suspending OPEBs and property taxes, makes it "a really critical week for us," Howe said.
"This is utterly appalling and I've even used the words unthinkable."
The monitor, in his report acknowledges the concerns of the union and "agrees that this will impact many individuals who have no responsibility for what has happened."
But he argues it is the only way to keep the company operating, saying: "The unfortunate (but inevitable) fact is that USSC does not have access to liquidity or financing to honour these obligations," adding that if the order is not made the company would have to temporarily cease operations.
Howe has filed an affidavit arguing against the suspension of OPEBs and pension benefits. He also urges steelworkers and pensioners to gather at the Ontario Superior Court House at 10 a.m. on Wednesday at 330 University Ave. in Toronto.
The court hearings are scheduled to take two days.