Insight: In Mexico autos town, labor rights falter despite U.S. trade deal

Brookfield Business Partners LP

03/05/2021 12:00

By Daina Beth Solomon
    MATAMOROS, Mexico, May 3 (Reuters) - After successfully
staging a wildcat strike for higher wages in 2019, many workers
at the Tridonex auto-parts plant in the Mexican city of
Matamoros, across the border from Texas, set their sights
higher: replacing the union that they say failed to fight for
them. 
    Six workers at the factory, which refits second-hand car
parts for sale in the United States and Canada, told Reuters
they felt let down that their union, SITPME, did not back their
demands for better pay. About 400 Tridonex workers protested
outside a Matamoros labor court last year to be allowed to
switch unions.
    When the first protests broke out in 2019, many of the
plant's roughly 4,000 workers earned just above the then-minimum
wage of 176.72 pesos ($8.82) a day.
    The Tridonex workers and thousands more at other Matamoros 
factories walked off the job demanding a 20% raise and
32,000-peso bonus, many without union backing. In nearly all
cases, the companies conceded. 
    "This showed us what we were capable of," said Edgar
Salazar, then a Tridonex employee. "We know we have rights, but
the union just wants to cash in. It doesn't support us at all."
    Jesus Mendoza, SITPME's long-time leader, said his union
generated jobs and delivered perks to its members while
maintaining harmonious relationships with employers.
    However, Salazar and many of his Tridonex colleagues wanted
to throw their support behind a new organization led by activist
and attorney Susana Prieto.     
    But their efforts are failing, labor experts acknowledge.
    Dismantling the power of Mexico's entrenched unions is
proving a tough challenge, some labor activists say, with few
signs that reforms promised under a new North American trade
deal are yet charting an easier course.
    Amid resistance from SITPME, the Tridonex workers' request
to be represented by Prieto's union has still not been put to a
vote. Legal challenges by attorney Prieto to replace unions at
45 other factories in the area have also stalled. 
    When Prieto urged strikes in January to again demand higher
pay, just a few hundred people protested across a handful of
companies. 
    "They're scared, because they don't have anyone to defend
them," Prieto said.     
    According to Prieto, about 600 of her supporters at Tridonex
-- including Salazar -- were fired between April and October
2020. Reuters could not independently confirm this.  
    Cardone Industries, Tridonex's Philadelphia-based parent,
did not respond to a question about allegations of retaliation.
    It says layoffs were made due to reduced demand following
pandemic lockdowns but did not provide further details. Cardone
is controlled by Canadian company Brookfield Asset Management
 BAMa.TO . 
    
    SLOW PROGRESS
    Leftist President Manuel Andres Lopez Obrador passed a law
in 2019 guaranteeing workers the right to independent unions. 
Though strong on paper, it does not come fully into effect until
2023. 
    "The law in general is very good. But that doesn't mean
we're going to get any change in Mexico anytime soon," said
Kimberly Nolan, a labor scholar at the Latin American Faculty of
Social Sciences research institute.  
    Some of the Matamoros workers are now looking to the United
States for backing.     
    A new free trade deal between Mexico, the United States and
Canada (USMCA) implemented last year enshrined workers' rights
to choose which union administers their collective contract.
    With Democrat Joe Biden now president, Mexico may come under
close scrutiny to uphold the USMCA's pro-worker provisions,
which were partly designed to prevent low labor costs from
leeching more U.S. jobs.  
    Under the treaty, companies failing to ensure freedom of
association for workers in Mexico could be sanctioned with
tariffs and other penalties. 
    The Office of the U.S. Trade Representative, which runs U.S.
trade policy, did not respond to a question of how the Biden
administration would treat violations of the trade pact's labor
measures. 
    But Katherine Tai, head of the agency, said last week she
was "not afraid" to use the enforcement provisions of the USMCA,
without specifying which issues could come under review. 
    The powerful U.S. union federation, the AFL-CIO, told
Reuters in April it was drafting cases against companies in
Mexico under USMCA, and would make details public in May.   
    Matamoros is one of a string of Mexican border cities which
American firms were lured to by cheap labor in recent decades.
Its factories supply parts for General Motors Co  GM.N , Toyota
Motor Corp  7203.T , Stellantis  STLA.MI  and other automakers. 
    Booming trade with the United States has brought jobs to
areas of northern Mexico but labor rights lag. 
    Companies in Mexico have commonly fired workers, among other
tactics, rather than allow them to agitate for new unions, say
activists, scholars and government officials. 
    "They fire them; they suppress them. They stop giving extra
hours. They don't give bonuses. They change them to night
shift," said Alfredo Dominguez, head of the Federal Center of
Conciliation and Labor Registration, created under the labor
reform to ensure collective contracts are legitimate.
    One of the labor ministry's priorities is to eliminate
so-called "protection contracts," signed between unions and
employers without workers' prior consultation or knowledge,
which Dominguez said make up at least 80% of all collective
contracts in Mexico.  
    The labor reform, once implemented, will also do away with
local panels blamed by labor activists for long delays in the
process of establishing new unions like Prieto's. The boards
will be replaced with tribunals reporting to the judicial
branch.
        
    NEW TACTICS
    Frustrated by delays in setting up a new union, hundreds of
Tridonex workers early in 2020 opted for a new tactic: declaring
they no longer wanted to pay dues to the established union,
SITPME. After several tense protests, Tridonex consented.
    Then firings began, four workers told Reuters.
    In March 2020, Efren Ruiz, who cleaned and assembled brake
parts for Tridonex and was a vocal advocate of Prieto's union,
was dismissed.
    "This is reprisal," Ruiz remembered telling a supervisor,
before security guards escorted him out, he said.  
    Three other workers also said they believed their union
activism led to their dismissals. 
    A government record seen by Reuters, dated October 30, 2020,
shows Tridonex dismissed 717 people from April to October last
year. 
    Reuters was unable to determine if any have been hired back
since. Mexico's Social Security Institute, which tracks
employment, said it could not comment on individual companies.
    Prieto said the firings were retaliation by the company to
protect SITPME and prevent more strikes for better pay. 
    SITPME leader Mendoza described complaints of retaliation as
"lies." 
    Cardone said in a statement the staff reduction was due to a
drop in demand and was "managed through transparent and
constructive discussions with employees and relevant trade
unions."
    SITPME - which extols membership perks such as medical and
legal aid - said it lured back at least 3,000 people from
different companies who had supported Prieto's breakaway group.
Reuters could not independently confirm this.  
    Mendoza noted that he strives for dialogue with companies,
not strikes: "What we do well is guarantee labor peace and
efficiency in the workforce." 
    ($1 = 20.0330 Mexican pesos)

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
ANALYSIS-Mexican labor activist's arrest sends 'wrong signal'
under North America trade deal     urn:newsml:reuters.com:*:nL1N2E61DP
Mexican labor activist released from jail as trade deal takes
effect     urn:newsml:reuters.com:*:nL1N2E82R6
Mexican labor activist fights ban from border state, cites trade
pact protections     urn:newsml:reuters.com:*:nL1N2EF2Q2
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Daina Beth Solomon; additional reporting by Ben
Klayman in Detroit and David Lawder in Washington
Editing by Christian Plumb, Daniel Flynn and Alistair Bell)
 ((daina.solomon@thomsonreuters.com; +52 55 5282 7150;))