Alfonso Rodríguez-Arana
Managing Partner at Legalmex
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Insight

Reform To Even The Labor Playing Field

Mon, 10/22/2018 - 16:09

Labor law in Mexico can be particularly tricky waters to navigate, especially for miners. Located in remote areas, labor disputes with workers and trade unions often end in blockades, giving the operator no alternative but to ride out the storm and the workers the leverage to negotiate. Alfonso Rodríguez-Arana, Managing Partner of Legalmex, says the government’s 2017 reform of the Constitution’s article 123, related to the federal labor law, was an attempt to even the playing field and ensure Mexico remained an attractive destination for FDI. “The reform was intended to professionalize the delivery of labor justice through the creation of labor tribunals and the close regulation of the country’s labor unions,” he says.
Specialized in advising the mining industry on how to navigate intricate Mexican labor regulations, Rodríguez-Arana anticipates the 2017 reform will come into effect in early November 2018, a delay from its expected February start. “There will be a transition period needed so the authorities can create and put into effect all the new organisms,” he says. Among these are labor tribunals, which will report to the judiciary and are intended to replace the existing labor boards. Rodríguez-Arana says these labor boards are typically tainted by corruption and he welcomes a change in the law that would shift the delivery of justice to the judiciary. The professionalization of the system is expected to be beneficial for employers, unions and workers alike.
On paper, labor unions are meant to fight for the interest of their members, but the law has limited their power in practice. “The reform includes the creation of an organism to support and control labor unions, which has upset their leaders because they cannot predict how this organism will change the status quo,” explains Rodríguez-Arana.
The idea is to create a new agency to which labor unions will report so authorities can better regulate workers’ representation and limit the power of unions that do not necessarily have the best interests of their workers at heart. “Social justice has not been accomplished in Mexico, in part due to unions prioritizing personal interests instead of those of workers,” he says.
But with a labor law composed of more than 1,000 articles, with several related and constantly-changing regulations and codes, it is hard for mine operators, other employees and employers to keep up. Rodríguez-Arana believes in seeking deregulation. “Businessmen have to focus on their core business and possibly have no time to be aware of such overregulation,” he says.