Algoma suspends retiree work program

Arbitrator's ruling will save 360 jobs, retirees no longer able to return to work and collect wages on top of pension

Following an arbitrator’s ruling in the company’s favour, Algoma Steel Inc. is ending an arrangement with the United Steelworkers of America that let young retirees return to work.

The Sault Ste. Marie, Ont.-based steelmaker had planned to lay off about 600 workers, or 18 per cent of its workforce, in the coming months but the ruling by the arbitrator means that number will be reduced by about 360.

“That will definitely lesson the blow,” Steve Boniferro, Algoma’s vice-president of human resources, told the Toronto Star.

Algoma was hoping to reduce the number of layoffs by suspending the retiree program. The program, which started following a restructuring in 2002, allowed about 360 young retirees to return to work and collect 80 per cent of their regular wages and a pension.

But the union fought Algoma’s plans to eliminate the retiree program, and the two sides took the dispute to arbitration.

Arbitrator Paula Knopf said the retirees no longer have any seniority rights under the union’s contract with Algoma, but the company may hire those retirees in special circumstances if there is a shortage of skilled workers. She also ordered Algoma to create a “spare board” for retirees so they can be recalled if all of the laid-off workers are back working again.

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