Algoma Steel CEO gets $6.82m amid 1,000 layoffs and $985m loss
Algoma Steel CEO Michael Garcia received $6.82 million in 2025 compensation, a 22.2% rise from the prior year, alongside 1,000 layoffs and a $985-million loss. The United Steelworkers union condemned the increase as unjustifiable given the economic impact on workers and the community.
*this image is generated using AI for illustrative purposes only.
Algoma Steel Chief Executive Officer Michael Garcia received $6.82 million in total compensation for 2025, a 22.2% increase from the previous year, despite the company laying off over 1,000 workers and recording a loss of $985 million. The payout, disclosed in the company's executive compensation report, has drawn sharp criticism from the United Steelworkers union (USW), which represents the majority of employees at the Sault Ste. Marie operations.
The compensation package included a base salary of $1.07 million and $5.75 million in other forms of compensation. Garcia's total remuneration for 2025 was 130% higher than the $2.96 million he received two years prior. The company disclosed that the economic terms agreed upon with Garcia were materially lower than those he would have been entitled to under the termination without cause provisions of his employment agreement.
Financial Context and Union Response
The significant compensation increase contrasts sharply with Algoma Steel's financial performance and workforce reductions. In December 2025, the company announced it would lay off more than 1,000 workers. The company also faced an annual loss approaching $1 billion, specifically $985 million, under Garcia's leadership.
The USW argued that awarding substantial increases to top executives during a period of mass layoffs and poor financial results is unacceptable. The union highlighted that Garcia's bi-weekly paycheque from his base salary alone exceeded $41,000, which is more than millions of Canadians earn in a year. Furthermore, the union noted that the total 2025 compensation package amounts to more than double the lifetime earnings of the average Canadian retiring today.
Compensation Details
The following table outlines the progression of Michael Garcia's compensation over the reported period:
| Year | Total Compensation ($) | Change (%) |
|---|---|---|
| 2023 | 2,960,000 | - |
| 2024 | 5,580,000 | - |
| 2025 | 6,820,000 | 22.2% (vs 2024) |
Algoma Steel's board of directors approved the compensation package. Garcia retired at the end of 2025. The USW emphasized that the workers and the community of Sault Ste. Marie deserve greater corporate accountability, particularly as the company had previously accepted nearly $1 billion in public funding.
How will the United Steelworkers union leverage this controversy during future contract negotiations?
Could public backlash over the payout lead to increased government scrutiny regarding the nearly $1 billion in previous public funding?
Will Algoma Steel face significant shareholder activism or derivative lawsuits regarding the board's approval of this compensation package?
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