Unions urge feds to close loophole allowing CESSCO to use CEWS cash to squeeze locked-out workers

Pandemic relief money should be used to help workers, not hurt them

EDMONTON – The Alberta Federation of Labour and the Boilermakers union are calling on Federal Finance Minister Chrystia Freeland to close a loophole in the Canada Emergency Wage Subsidy (CEWS) which they say is allowing an Alberta company to use federal pandemic relief money to break a union and keep over 20 highly-skilled tradespeople out of work.

The company in question is CESSCO Ltd., a metal fabrication shop in the federal constituency of Edmonton-Strathcona, which locked-out workers in June 2020 in an effort to force them to accept deep cuts to their wages and pensions. Recently released documents from the federal government show that CESSCO has applied for and received assistance from the CEWS program.

“We want to make it clear that we applaud and fully support the efforts that the federal government is making to help workers and businesses get through the pandemic. The CEWS and the Canada Emergency Recovery Benefit (CERB) have both been vital lifelines for individuals, businesses and the economy,” says Alberta Federation of Labour president, Gil McGowan.

“However, we feel very strongly that tax dollars should not be given to employers who have locked-out their workers. In the case of CESSCO, we have no doubt that the CEWS money is being used to subsidize the use of replacement workers; and it has likely been used to offset the costs of lawyers and security firms, who have been working hard to prolong the lockout and starve the workers out. This is contrary to the vision and the goals of CEWS. This money is supposed to be used to help workers, but in this case, it's being used to hurt them.”

Hugh MacDonald, Business Manager of the Boilermakers Lodge 146, which represents the locked-out workers, says the CEWS money given to CESSCO is essentially being used to subsidize the company’s dirty work during the lockout.

“How do taxpayers feel about their hard-earned money flowing to employers who treat their long-term workers so unfairly?” asks MacDonald.

“Even though we have offered to go back to work under the old contract, CESSCO president, Dave Hummel refuses to bargain in good faith. They have not an inability to pay, rather an unwillingness. The CEWS is being used in a way that it was not designed for: to keep these workers on the picket line when they should be on the job building our province’s economy.”

MacDonald adds that the CEWS money given to CESSCO is “giving them a pot of money to hire scabs, anti-union security personnel and lawyers to help drag out the lockout and break the union. The intent of the CEWS is to protect jobs, but our fear is that, in the case of CESSCO, it is being used to kill jobs and strip workers of their constitutionally protected right to workplace representation – both outcomes that I am confident were never envisioned or intended by the federal government.”

McGowan sent a letter to Freeland today urging her to update the eligibility rules for CEWS so that “companies like CESSCO can’t use this program to subsidize scabs’ wages and drag out labour disputes.” He also asked that CESSCO be required to pay back the money that it has already received from the program.


*To arrange interviews with either AFL president, Gil McGowan or Boilermakers 146 Business Manager, Hugh MacDonald, please contact AFL Communication Director Ramona Franson at [email protected].


Ramona Franson
Director of Communications, AFL
[email protected]