Irving Shipbuilding as part of J.D. Irving Limited is often criticized by both the local government and the media over its scale of operations, with some people claiming the family holds a monopoly over the atlantic provinces.
The Irving Whale is a Canadian barge that sank off the north coast of Prince Edward Island, while en route from Halifax, Nova Scotia to Bathurst, New Brunswick, taking 4,200 tonnes of fuel oil down with it. It was laid down at the Saint John Shipbuilding & Dry Dock Co., Ltd., Saint John in 1966. It carried oil for JDI from 1967 until it sank in 1970.
About 1,100 tonnes of oil spilled into the ocean, 5,700 kilograms of which were laced with PCBs. The cost of the salvage operation was $42 million, and was assumed by the federal government with great controversy. This was given due to the wealth of Irving Oil Ltd, owner of the cargo of oil, and J.D. Irving Ltd., owner of the barge.
In March 1995, Environment Canada reached an agreement with an Irving Oil company, Atlantic Towing Ltd, to provide assistance in the salvage operation, along with Irving Shipbuilding, who would clean and recover Irving Whale upon her salvage. On 30 July 1996, Irving Whale was hoisted by derrick barges Chesapeake and Boabarge 9 to the surface in approximately 70 minutes. Irving Whale arrived in Halifax Harbour on 7 August 1996 and was transferred to the care of Irving Shipbuilding. The barge's cargo was removed and the cargo hold cleaned before the barge underwent a refit. Following the refit, the barge was transferred to Atlantic Towing Ltd, and renamed ATL 2701 in 2001 for service as a general cargo barge. It was renamed again as Atlantic Sea Lion in 2009.
The dispute with the federal government ended in 2000, with the Irving companies paying $5 million, without admitting liability. This resulted in a legal battle between the Irvings and their insurers who, coincidentally, had covered them for up to $5 million. The policy was decades old, and the Irvings were not legally obliged to pay the $5 million.
On November 30, 2013, engineer Qing Quentin Huang, an ex-employee of Lloyd's Register, a subcontractor to Irving Shipbuilding, was arrested under the Security of Information Act after attempting to communicate secrets to a foreign power. Police said the information was related to elements of the federal shipbuilding strategy, which includes patrol ships, frigates, naval auxiliary vessels, science research vessels and ice breakers. Huang was arrested in Burlington, Ont., following an RCMP-led investigation called Project Seascape. Huang was not a target of the warrant and had never been under CSIS investigation. However, At the time, the Canadian Security Intelligence Service (CSIS) were intercepting communications made to and from the Chinese Embassy after obtaining a warrant. CSIS advised the RCMP of phone calls Huang allegedly made to the embassy, and claimed he had "offered to provide Canadian military secrets" to the Chinese government. That prompted the Ontario National Security Enforcement Team, working with the Toronto Police Service, to have undercover operators pose as Chinese agents and approach him about acquiring the documents, resulting in Huang's arrest. He was granted bail during the whole ordeal.
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Eight years after his arrest, a judge stayed charges against Qing Quentin Huang "on the basis of unreasonable delay."
Pearl Mist
Pearl Mist is a small cruise ship that was the center of a legal dispute between US owner Pearl Seas Cruises and Irving Shipbuilding Inc, over breach of contract. In 2013 a United States federal appeals court ruled in favour of Irving subject to the contracts arbitration clause, and a settlement was reached. Pearl Mist was accepted by Pearl Seas Cruises and towed to Baltimore, Maryland, in April 2013.
Suicide
On November 28, 2013, between 200 and 300 workers walked off the job, complaining of growing frustrations over increasing numbers of disciplinary letters, firings and suspensions of other employees. The walkout occurred after the suicide of a worker who had just received a 30-day suspension, although no official correlation between the suicide and suspension was ever made. Irving defended administering the suspension but would not elaborate.
Municipal property tax break
Halifax Regional Council approved a special 25-year property tax deal for Irving Shipbuilding. The tax deal was accidentally disclosed, but not debated, in late March, after a year of negotiations between the city and Irving officials. The Irving shipyard had previously been paying $1.6 million a year on their waterfront facility. The new 25-year agreement (with a possible 10-year extension) dropped Irving's payment down to $563,000 with an annual one percent increase.
The company also received a refund from the city for the difference already paid at the prior rate. Halifax defended the deal by saying it feared a drawn-out legal fight with Irving.
Paradise Papers
In 2017, 13.4 million confidential records were leaked to German reporters Frederik Obermaier and Bastian Obermayer, from the newspaper Süddeutsche Zeitung. In 2022 it was revealed by these papers that J.D. Irving Limited had created an offshore insurance company in Bermuda that allowed them to move millions of dollars in profits out of Canada and into the tax haven. The Irving-owned Bermuda insurance company, F.M.A. Ltd, sold insurance premiums to Irving companies in Canada and Bermuda for their marine vessels.
F.M.A. then re-insured major risks to those vessels by paying lower premiums to a non-Irving reinsurance company based in Bermuda. This allowed F.M.A. to accumulate almost $13.4 million in un-taxed income between when it was incorporated in 1973, and 2001, the last year provided by the leaked records.
Jim Irving, J.D. Irving Limited's co-CEO, has stated it had dissolved its connections to Bermuda prior to the release, but Statistics Canada's inter-corporate ownership database continues to list five Bermuda companies, including F.M.W., associated with Irving as of its annual update on June 17, 2022.
Threatening journalists
Irving Shipbuilding threatened to sue journalist David Pugliese 90 minutes after submitting questions to the Department of National Defense. The DND confirmed it contacted Irving and informed them of Pugliese's identity and his questions. Pugliese's questions revolved around potential problems with the welding on the new Arctic patrol ships that Irving is building for the Royal Canadian Navy.
Shortly after, the company again threatened to sue journalists at the Globe and Mail, after Office of Innovation minister Navdeep Bains alerted them that journalists were asking why Irving Shipbuilding received a $40 million benefit toward an Alberta french fry plant as part of its industrial benefits requirements established under the Arctic Offshore Patrol Ship program.
The privacy commissioner's office would later conclude that the Department of National Defense contravened provisions of the Privacy Act after it informed Irving Shipbuilding of questions submitted by the journalists. Irving then claimed it threatened to sue journalists to protect the government's shipbuilding reputation, but the DND disputes the company's story. The Department of Innovation, Science and Economic Development says it has a contract with Irving that requires the department to alert the firm when journalists are asking questions related to the company.
In May, Canada's federal procurement minister stated she "wishes the Irving company hadn’t threatened to sue reporters asking questions about the company’s federal shipbuilding contracts."
Potato chip factory
The federal government in 2019 allowed Irving Shipbuilding to claim a $40-million industrial benefit credit for an Alberta french fry factory as part of the contract to provide the Royal Canadian Navy with new Arctic and Offshore Patrol Ships.
Covid protocols
In July 2020 Nova Scotia's chief medical officer of health, Dr. Robert Strang, backtracked his approval of three executives not having to self-isolate after traveling abroad on business, after workers at the Halifax shipyard learned of the exception and complained to his office. After ordering the executives to self-isolate he barred Irving executives from engaging in any more business travel to America until the emergency measures were lifted. "Even though the safety requirements were part of my approval, the meetings could have been done virtually," Strang said, while claiming he "never should have approved a plan".
In November 2020, about 90 workers at the Halifax Shipyard invoked the right to refuse unsafe work after learning an out of province worker had been brought in using a public health exemption to Covid regulations. A representative for the union said workers were concerned about health and safety protocols, exacerbated by a lack of information from the employer. The work refusal triggered an occupational health and safety investigation by Nova Scotia's Labour Department, and Irving Shipbuilding received a verbal warning after the department found the company had failed to properly inform the workers.
Strategic Partnership Agreement Umbrella contracts
In June 2022, the Canadian government was accused of considering a $300 million payment to Irving Shipbuilding so it could modernize its facilities to build navy vessels despite an earlier stipulation in the National Shipbuilding Procurement Strategy Strategic Partnership Agreement Umbrella Contracts stating that public funds would not be requested for such upgrades.
Tom Ring, who was Canada's Procurement Minister when the National Shipbuilding Procurement Strategy was proposed, suggests that this request for funds contravened the terms of the original Umbrella Agreement between Irving and the federal government. This agreement, according to the terms written at the time, stipulated that any upgrades required by the builders be financed with their own profit margins.
On 8 August 2023, Ottawa announced it had amended its definition contract with Irving Shipbuilding, and provide an infrastructure "investment" worth an additional $463 million to help Irving Shipbuilding build the Canadian Surface Combatants (CSCs). It stated, "enhancements at Irving Shipbuilding will expand and modify their site and facilities at the Halifax Shipyard and supporting facilities at Woodside Industries and Marine Fabricators in Dartmouth, Nova Scotia." This amendment allowed both Ottawa and Irving to circumvent the terms of the original Strategic Partnership Agreement which stipulated that Irving would not seek taxpayer monies to upgrade its facilities, but would instead make any such upgrades via their own funds. This sum is expected to "create or maintain over 800 jobs annually across various industries in the Canadian economy."
Accidents and investigations
In May 2010, the 152-metre-long dry dock Scotiadock II was submerged to allow a tugboat to enter the dry dock for maintenance, but instead of lifting the tug out of the water, the dock kept sinking. It stayed on the bottom of Halifax harbor for nearly a month and taxpayers contributed $260 million to build a new floating dock at the Irving Shipyard.
On July 2, 2015, Irving Shipbuilding faced four charges under Nova Scotia's Occupational Health and Safety Act after a worker was struck when a cable being used to launch a ship snapped and struck him in the head. The worker suffered a fractured skull and brain damage. The results of the investigation pointed toward negligence on the part of Irving. Irving initially entered a not guilty plea, but eventually withdrew this and was charged under all four counts.
In April 2016, a fire on HMCS Toronto resulted in 64 workers needing to evacuate and two hospitalizations; both were released shortly. That same month, during a site visit conducted on April 8, health and safety inspectors determined that work was being performed on ships containing lead primer by workers who did not know how to safely remove it. In a statement to PaintSquare News, Irving Shipbuilding confirmed that an employee contacted the government agency in April based on concerns about a 2014 blood lead test performed by a personal physician. In response, the shipyard was issued a warning regarding control of dust buildup and requirements regarding clothing contamination and the separation of work and street clothing. The alleged burning of paint and presence of paint chip debris also warranted a warning for the violation of safe work procedures. Inspectors also reported that the shipyard did not have a lead control program in place and was unable to supply a written document during the site visit. Since not all workers, including contractors, were aware of the hazards of working with lead, the company was ordered to provide awareness training on the topic before April 25. A separate compliance order, issued on April 12, requires Irving Shipbuilding to deliver a copy of its lead control program for removal of lead paint on ships; this document is to include a risk assessment for various work processes as well.
In May 2016, a scaffolding used to paint the ship HMCS Toronto fell over in high winds while workers were dismantling it. In an email, a representative for Irving Shipbuilding said no one was injured, while Unifor/MWF Local 1 union business agent Zibby Kwiatek claimed, "If it was during working hours, we would have casualties," and cited concerns about Irving trying to find "efficiencies" at the worksite.
In July 2019, a forty-year-old subcontractor was struck on the head by the lid of the sandblasting equipment he was using, resulting in a fall of several feet. He died three days later.
On August 6, 2020, the decision of four employees to exercise their right to refuse unsafe work, due to the mixing of silica, was upheld by the Nova Scotia Labor Board. An electrician raised safety concerns during the refit of HMCS Toronto. Despite the employer's assurances it would take steps to reduce the risk and prevent a re-occurrence, two days later the employees once again refused work. By August 12, three of the four employees involved agreed to return to work, while the outlier contacted a company OHS officer, who upon inspection of the shipyard failed to using any warnings or compliance orders. The JOHSC ordered the individual back to work. Six days later, on August 21, the employee filed their notice of appeal, stating the committee's decision was flawed and addressing the issue of whether an OHS officer has the right to intervene in or uphold a work refusal in such a case. In its decision, citing section 43 of the act, the Labour Board sided with the employee, stating, "total deference to the JOHSC is neither required by the Occupational Health and Safety Act nor is it advised," and the suggestion that an employee has no right to question or challenge that advice "would be inconsistent with the scheme of the act which provides for an appeal of officers’ decisions both to act and to not act."
In February 2024, a 43-year-old worker was struck by a piece of snow removal equipment and pronounced dead at the scene. The Labor Department said its safety officers are actively investigating the death, Halifax Regional Police said it is also investigating the death. "A Stop Work Order has been issued, and a review is underway of existing safe work procedures around snow removal processes, and mechanical assessment of the equipment involved," said labor department spokesperson Monica MacLean.
