Brothers and sisters,


On July 12, 2007 Armando Plastino issued an Intercompany Memorandum explaining the company’s asset integrity program in the event of a work stoppage. We believe this Memo is a good example of Algoma Steel’s definition of Full, True and Plain disclosure. In the third paragraph Mr. Plastino mentions for the purposes of asset integrity, in the event “our” employees are not available, exempt employees will start training in Cokemaking, Utilities and Material Handling.


Well, brothers and sisters, just five days later, on July 17, 2007 we received a telephone call informing us that an exempt employee from the Quality Assurance/Technical Services Department was being trained on the Hold and Release clerk jobs. The Hold and Release clerks ensure all of the paper work and customer spec’s are met for an order of steel. Once the hold and release clerk releases the steel it is then applied to a customer order and shipped. The steel by the way is not always on ASI property, this also applies to steel that has already been shipped to a storage yard off the property, like Southern Ontario perhaps. This job does not sound like asset integrity, it sounds like selling steel, does it not?


In Solidarity,


USW LU2251 Contract Action team



MEMO TO:                  To All Employees


MEMO FROM:            Armando Plastino


DATE:                          July 12, 2007



Negotiations between the Company and the Union are currently underway.  The Company remains committed to achieving a balanced agreement that is fair to employees and positions Algoma for success in an increasingly competitive marketplace.


In the event of a work stoppage, the Company must take all necessary steps to preserve the assets.  As you may already be aware, at the outset of negotiations the Company asked the Union to give assurance that in the unlikely event of a work stoppage, they would provide the employees required to maintain the integrity of the assets.  We hope to receive confirmation of this support, but they have not yet agreed to do so.


In the meantime, although the Company would prefer to have the assurance that our own employees would be available to protect the assets, we must prepare for a possible work stoppage via whatever other means are available.  To this end, we will begin training a small number of exempt, management employees on key operating tasks in Cokemaking, Utilities and Material Handling.  This training will begin on Monday, July 16th and will continue for the balance of the month.


We do not want to take this course of action, but we must be prepared to protect the assets in the event there is no agreement.  Doing this with management personnel is not an optimum solution but unfortunately, the only one available to us at this time.


In addition, we have hired an outside agency that will provide the necessary additional support in key operating areas along with security and fire and flood patrol required to maintain the assets.  We remain hopeful that we will not need to implement this contingency plan.


As difficult as this situation may be, we trust that all employees will provide their usual support and cooperation.  We all look forward to reaching agreement before the contract expires