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Unions win the right to challenge unfair trade practices

Workers achieved a long-fought-for trade victory in the 2022 federal budget: trade unions will soon have the right to file trade complaints against unfair imports, something only domestic producers could do before now.

October 26, 2022

2-minute read

While unions gained the right to participate in trade remedies cases in 2017, that participation needed to support a complaint from domestic industry. Amendments to the Special Import Measures Act in Bill C-19 (the Budget Implementation Act), along with amendments to the Special Import Measures Regulations and CBSA rules, will effectively allow unions to file anti-dumping and countervailing duty cases.

The changes bring Canada’s trade remedy law more closely in line with comparable laws in Australia and the United States. But Canada has gone a step further in some areas. In addition to expanding the right to initiate trade cases, the recent reforms grant the Canadian International Trade Tribunal (CITT) the ability to consider the impact of unfair trade on workers.

In essence, workers’ interests only used to matter to the extent that any harm to them could be considered a harm to industry. Layoffs, contracting out, community harm, pension cuts, or anything else that can be linked to unfair trade may now be taken into consideration when the CITT determines whether an imported product is harming Canadian industry.

The trade remedies reforms are the result of extensive testimony from workers about the on-the-ground impact of unfair trade on steel and other products. Workers are often the first to see unfairly traded products entering the markets. They hear the rationale from employers during collective bargaining that they cannot afford a wage increase, or need to cut pensions, or need to contract out positions because of cheap products flooding the market.

Initially, unions—and particularly local union leaders—were viewed with suspicion by the established players from industry, employer-side trade lawyers, government, and the CIIT itself. The Steelworkers in Canada led the charge, with local union leaders testifying in over 20 cases over the past five years.

Eventually, virtually no steel trade remedies cases proceeded without hearing from workers about the impact of unfair trade on their livelihood. Combined with extensive lobbying efforts, the Canadian labour movement, led by the Steelworkers, were able to achieve substantial gains.

In its participation in cases, the Steelworkers focused largely on the steel industry, where the union represents tens of thousands of workers. The Canadian steel industry has been harmed by cheap products entering the market for decades. According to Statistics Canada, employment in primary steel fell from over 35,000 in 1990 to about 22,000 today.

While there are multiple causes for this drop in primary steel employment, global steel overproduction—often facilitated by unfair subsidies—has played a part. As of 2020, steel overcapacity hit 640 million tonnes, which is more than 40 times the size of the Canadian market alone, according to the Canadian Steel Producers Association.

Workers bear the brunt of a volatile industry defined by overproduction and, until now, had little recourse to deal with a situation that directly affects their livelihoods. The recent trade remedy reforms will provide workers with additional power to fight back against conditions that allow products to enter Canadian markets as a result of unfair subsidies or currency manipulation.

But the reforms will help well beyond the steel industry. Trade unions have participated in cases involving aluminum products, copper pipe, as well as manufactured consumer goods. Any industry exposed to trade will likely be affected by unfair trading practices at some point. Now Canadian workers will have a voice in those disputes.

These changes to trade law were almost unimaginable as recently as five or six years ago. Participation in trade remedies cases was, in many ways, a closed club for select industry, government and legal representatives. Despite workers being the most affected by the impacts of unfair trade, they were, at most, an afterthought.

The USW took its first stab at leading a trade case this October. While the union has mostly been involved in steel sector cases, the first-ever case led by a union alleges that mattresses dumped into the Canadian market are harming employment in mattress manufacturing across Canada.

Ultimately, while these changes to trade law, regulations and practices are important, they must accompany broader efforts to develop worker-centered trade policy. Specifically, governments need to create a trade environment that veers away from facilitating the influx of products made cheap through labour and environmental exploitation.

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