About 500 employees of Astaldi Canada and its subcontractors are headed home from the Muskrat Falls hydroelectric project site after Nalcor Energy ordered the company out.
“Nalcor Energy has been closely monitoring the financial situation with Astaldi Canada Inc. Given Astaldi’s inability to continue to pay its workers, Nalcor has directed Astaldi to stop work. We are taking this action to minimize the financial harm placed upon the workers by Astaldi,” stated a news release issued late Thursday afternoon by Nalcor.
The provincial Crown corporation said the priority right now is making arrangements for Astaldi employees in Labrador to return home from the work site in an orderly fashion.
“Astaldi's Surety has directed payment of funds to the Resource Development Trades Council (RDTC) in relation to Astaldi’s obligations to the workers’ pensions and benefits plan,” reads Nalcor’s statement. “We understand this is a challenging situation for workers and will continue to work with the RDTC to address their outstanding concerns.”
The RDTC is a collective representative for 16 trade unions active on the megaproject.
As reported by the CBC’s Rob Antle, the trades council has launched a lawsuit against Astaldi for $7.8 million plus damages, claiming the contractor has not put cash toward a variety of benefit plans in July and August. Nalcor Energy and the subsidiary Muskrat Falls Corporation are also named as defendants in the case. The CBC has also reported existing Astaldi Canada debts, as per court filings for a separate labour dispute with the RDTC and court battle over taking the dispute to arbitration.
At the end of September, parent Astaldi SpA filed for creditor protection under the Italian Insolvency Act, but the application allowed work to continue on contracts around the world, including Astaldi Canada’s work at Muskrat Falls. A representative for Nalcor Energy rejected a request for an interview on the subject, but said the company’s work at Muskrat Falls was about 95 per cent complete as of the end of August.
Nalcor Energy says all of the money owed to Astaldi under contracts for work on the powerhouse, intake and spillway at the hydropower facility under development has been paid.
“Today’s action will not have any impact to the ongoing work activities of the other contractors and workers on site and their work will continue as planned. Work is focused on ensuring we meet the critical path for first power as planned in 2019,” the Crown corporation stated.
Nalcor Energy has generally pointed to insurance and securities as financial protection for the corporation and ultimately the province of Newfoundland and Labrador.
“We have also been working on a contingency plan to finish the work should Astaldi be unable to complete its remaining scope of work,” it stated.
The official estimated cost for the Muskrat Falls hydroelectric project stands at $12.7 billion.
NOTE: This is an updated version, to include context on Astaldi's filing for creditor protection.
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