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Analysis

USMCA in Action: Reinventing Mexico’s Labor Democracy

By Antonio Gozain | Thu, 07/21/2022 - 08:00

Since USMCA’s enforcement, the hegemonic Mexican Worker Confederation (CTM) has started to lose power among automotive companies. CTM-affiliated unions have lost the vote to independent counterparts at key plants, such as Nissan Aguascalientes and General Motors Silao. With the automotive sector leading the way, the entire Mexican industrial sector could experience a dramatic shift in worker representation, which would lead to fairer conditions for Mexican workers to freely elect their representatives and actively participate in decision-making processes.

Unionization in Mexico has historically been involved in controversy, with accusations, imprisonment, diversion of resources, embezzlement, among other scandals. Several cases have shocked Mexico, such as the imprisonment of Elba Esther Gordillo, former leader for the National Education Workers’ Union (SNTE), Latin America’s largest union. Gordillo was arrested in 2013 under charges of embezzlement and organized crime and was included in Forbes’ “10 most corrupt Mexicans” list that year. Gordillo was accused of diverting over US$200 million, while other leaders such as Napoleón Gómez Urrutia, Secretary General, Mexico’s National Mining, Metallurgy, Steel and Related Industries Union, faced similar charges for US$55 million.

Mexican unions do not represent workers’ interests, wrote for Reforma Gabriel Zaid, Mexican poet and intellectual: “Workers’ unions are completely subordinated to the business community and in a lesser extent to the State.”

The history of CTM began in 1936. The confederation was created by PRI, the leading political party during the 20th century, and still holds close relationship with the party. “This confederation has always manifested itself as institutionally-based. We are supporting the government in current administration. As a confederation, we do belong to a party, PRI, since CTM’s inception,” said in 2015 José Luis Carazo, CTM’s Labor Secretary.

In December 2018, CTM and the Revolutionary Confederation of Workers and Farmers (CROC) were expelled from the International Trade Union Confederation (ITUC). Both organizations were accused of promoting employer protection contracts, as well as attacking union freedom and democracy. “These corporate organizations continue to carry out actions against the principles and values of workers and, consequently, those of ITUC,” reads ITUC’s resolution.

On Jan. 29, 2020, USMCA introduced new industry challenges in the form of tougher rules of origin for automotive components and cohesive labor standards validated by Mexican reforms, which would eventually lead to CTM loosening its grip on Mexico’s industrial scene. “The changes in the new treaty focus on a concept that for most companies in Mexico is difficult. However, for those that have already experienced a trade union environment, it is easier: the democratization of labor relations,” said during Mexico Talent Forum 2021 Luis Monsalvo.

USMCA triggered several labor complaints from the US government against Mexico due to companies operating in the country that did not respect freedom of association and collective bargaining rights. In June 2022, workers of auto parts company VU Manufacturing presented a labor complaint under USMCA, arguing that the company seeks to impose a friendly union to support its interests.

In September 2021, CTM lost the representation election against the Autonomous Confederation of Workers and Employees (CATEM) at Nissan’s Aguascalientes plant. Also in September 2021, USMCA’s new Rapid Response Labor Mechanism was tested successfully at GM’s plant in Silao, Guanajuato. A labor complaint from the US government demanded to review whether workers at the plant were being denied their freedom of association and collective bargaining rights, as reported by MBN.

These votings represented an “inflection point” in Mexico’s labor democratic life, said Pedro Haces, General Secretary, CATEM. After the labor complaint from the US government, two elections to legitimize the Independent Syndicate of National Workers’ (SINTTIA) win over CTM and an additional vote to represent the workers, SINTTIA signed its first collective labor agreement with GM in May 2022.

“This is a new, historic achievement after an important organizational process and a year of struggle since the first failed election; a second election, in which CTM’s spurious contract won, and the constitution of SINTTIA,” said SINTTIA in a statement.

In March 2022, Tridonex’s auto parts’ plant workers in Matamoros successfully voted and shifted from the CTM-affiliated Industrial Union of Workers in Maquiladora and Assembly Plants (SITPME) to the National Independent Union of Industry and Service Workers, 20/32 Movement (SNITIS), as reported by MBN. These transitions are gradually happening at several other plants. In April 2022, the US presented a labor complaint against Panasonic Automotive in Reynosa. Two weeks later, SNITIS defeated its counterpart. In June 2022, the new union signed a new labor agreement with Panasonic Automotive, reported El Sol de Tampico. SNITIS is also involved in union elections at AFX Industries, OHD Operators de México, Parker Brownsville Servicios and Tricon y Componentes, reported MBN.

With the US actively reviewing whether companies in Mexico promote labor standards and enforce workers’ rights under USMCA, traditional unions, which have historically disadvantaged the workers they represent, are increasingly losing power in Mexico. Independent and worker-elected unions are in a better position to defend workers’ rights, aiming to tighten the big gaps between the salaries offered by companies in the US and their subsidiaries in Mexico.

Union leaders, both from traditional and independent organizations, have three different stances regarding the current legislation and the future of the labor democratic life in Mexico, said Bensusán. “Some play simple simulation, dreaming to remain the same [powerful leaders] of always. Others realize that they have to adapt and try to establish a relationship with workers. Finally, there are few who think about transformation [and] realize that it is not only about a change of norms but shifting leadership, strategies and alliances.”

The Government’s Current Relationship With Union Confederations

While CTM has historically been aligned with PRI, President Andrés Manuel López Obrador’s relationship with the organization has had its ups and downs. In 2019, Carlos Aceves del Olmo, Secretary General, CATEM, accused Haces of flaunting his relationship with López Obrador and of having the task of destroying CTM, reported La Jornada. The president, however, has said in many occasions that his government will not delve in favoritism nor will there be tutelage from unions. “You can use my name but let it be known that I represent all Mexicans. It is not true that I have a preferred union,” said López Obrador in March 2019.

In March 2021, transport organizations linked to PRI and CTM protested during an event that President López Obrador had regarding the Mayan Train. CTM leaders accused the government of Mexico of giving CATEM half of the contracts of the mega-projects, reported La Jornada.

The current labor reality in Mexico is shifting due to USMCA and the Labor Reform, enforced on Sept. 1, 2021. However, there is still a long path to cover, said expert researcher Graciela Bensusán, during a recent tri-national meeting with lawyers and labor experts. While the reform was necessary, it “is not enough for the transformation to happen,” because Mexico faces 100 years of “bad practices and cultural [issues].”

Union leaders, both from traditional and independent organizations, have three different stances regarding the current legislation and the future of the labor democratic life in Mexico, said Bensusán: “Some play simple simulation, dreaming to remain the same [powerful leaders] of always. Others realize that they have to adapt and try to establish a relationship with workers. Finally, there are few who think about transformation [and] realize that it is not only about a change of norms but shifting leadership, strategies and alliances.”

The data used in this article was sourced from:  
MBN, USTR, Ministry of Economy, Reforma, El Economista, La Jornada, El Sol de Tampico
Antonio Gozain Antonio Gozain Journalist and Industry Analyst