First Complaint Under New Trade Deal Targets Mexico Auto Plants

American and Mexican unions invoked a provision in the United States-Mexico-Canada Agreement, seeking to crack down on an auto parts maker for retaliating against pro-union employees.

(AP Photo/Carlos Osorio, File)

(CN) — Claiming an auto parts manufacturing firm in northern Mexico is firing workers for organizing with an independent union, the AFL-CIO filed a first-of-its-kind complaint Monday with the Biden administration it says will test whether a new North American trade agreement can affirm Mexican workers’ rights to bargain for better wages.

Reached in late 2019, the United States-Mexico-Canada Agreement, or USMCA, replaced the North American Free Trade Agreement of 1994 that created a free trade zone for the three countries and eliminated tariffs on most of Mexico’s exports to the U.S. while also cutting tariffs on U.S. exports to Mexico.

The new agreement includes a “rapid response mechanism” by which labor violation complaints can be lodged, and penalties levied, against factory owners.

Tridonex, owner of auto parts plants in the city of Matamoros – across the Rio Grande from Brownsville, Texas, in the northeastern state of Tamaulipas – is the target of the AFL-CIO’s complaint, the first grievance brought under the USMCA.

The union says the company, a subsidiary of Philadelphia-based Cardone Industries Inc., has fired more than 600 supporters of Sindicato Nacional Independiente de Trabajadores de Industrias y de Servicios Movimiento 20/32, or SNITIS, a union formed after worker protests in 2019 forced Mexican factory owners to raise wages.

The AFL-CIO filed the complaint with SNITIS and Service Employees International Union.

The unions claim the Tridonex workers who sympathize with SNITIS and have yet to be fired are being harassed for trying to organize with the union.

The governor of Tamaulipas, Francisco Javier García Cabeza de Vaca, had the pro-union workers’ attorney Susana Prieto Terrazas locked up for a month in a state prison on bogus charges in retaliation for her labor organizing activities, according to the AFL-CIO. Prieto was only released after agreeing to a ban on appearing in labor court, the unions claim.

Mexico approved major changes to its labor laws in May 2019, to be phased in over several years, and also committed to passing new labor laws in the USMCA.

The 2019 reforms increased Mexican workers’ protections by establishing the right to join unions of choice, ensuring they can vote for union reps by secret ballot and creating an independent labor court to resolve disputes between union workers and employers.

One expert said Mexico President Andrés Manuel López Obrador is not worried about implementing the labor reforms because he is overwhelmed with simultaneous health and economic crises brought on by the Covid-19 pandemic and a security crisis caused by drug cartels.

“So I don’t think there are really any efforts in Mexico to aid labor, that is pending but they haven’t paid much attention to it,” said Tony Payan, director of the Center for the United States and Mexico at Rice University’s Baker Institute for Public Policy.

For years, Mexican companies have entered into contracts with sham worker rights groups called “protection unions,” paying them kickbacks to shield them from strikes. The protection unions enlist workers without their knowledge because they do not collect dues.

Prieto, the union lawyer, indicated in a statement that Tridonex workers are being exploited by the company through a protection union.

“Tridonex workers are suffering from the abuses of a corrupt and criminal union leader, who is protected by the company so that it can continue providing precarious wages and working conditions,” she said in a statement. “All of this through oppressors who harass, intimidate and beat the workers with the consent and protection of Tamaulipas Gov. Francisco García Cabeza de Vaca.”

Payan said both de Vaca and the governor of neighboring Chihuahua state, which is home to many large factories called maquiladoras, are anti-union because they see unionization as antithetical to economic development in their states.

They also belong to the center-right National Action Party (PAN) for which they are despised by Obrador, who belongs to an ostensibly left-leaning party called the National Regeneration Movement (MORENA), according to Payan.

Consequently, Payan said, the chances of Mexico’s federal government and state governments of Chihuahua and Tamaulipas resolving the issue in a way that benefits workers is minimal.

The professor said the AFL-CIO’s complaint has touched on a “multilayered complex conflict” in which there is an instigator, the union attorney Prieto, in close touch with the AFL-CIO and using the new rapid response mechanism baked into the USMCA to pressure the governors of Chihuahua and Tamaulipas to ease restrictions on union organizing.

“Mexican workers’ wages have been suppressed for a long time….the country has attracted a lot of investment but the wages don’t rise. But now there’s this mechanism,” Payan said.

The mechanism was added to the USMCA at the behest of congressional Democrats, who leveraged their control of the House to successfully press for tougher labor and environmental standards in the new trade pact compared to NAFTA, the one it replaced.

The auto industry is a focal point for reforms in the new trade agreement.

NAFTA led Toyota, Volkswagen, Chevy, General Motors and Kia to open plants in Mexico due to the lower costs of production, with Mexican auto workers typically earning pennies on the dollar compared to their U.S. counterparts because Mexico does not have the same tradition of strong unions negotiating strong salaries through collective bargaining.

Experts say the rapid response regime will work like this: After reviewing the unions’ complaint, the United States will decide if there is evidence of workers’ rights being denied, then ask Mexico to review the allegations. A panel could then be set up to investigate the complaint. Tridonex could face penalties. Repeat offenders could have their goods blocked from entering the United States.

Tridonex’s parent company Cardone Industries denied the unions’ claims in a statement.

“We are committed to leading labor practices, fostering constructive relationships with employees, and respecting the universal principle of freedom of association and the right to collective bargaining. We do not believe that the allegations in the complaint are accurate and welcome a full inquiry so that the facts can be disclosed,” it said.

“We fully support our Tridonex workers being represented by a union,” it added, “and are committed to compliance with all applicable labor laws and regulations. We will be transparent in addressing requests for information and proactive in addressing any concerns identified through the process.”

%d bloggers like this: