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New NAFTA’s Labor Terms Sway AFL-CIO, But Not All Unions on Board (2)

Dec. 10, 2019, 5:30 PMUpdated: Dec. 10, 2019, 11:23 PM

The nation’s largest union umbrella organization is now supporting the new North American trade pact based on recent revisions to labor terms that not all unions are immediately ready to declare as a win for workers.

AFL-CIO President Richard Trumka, whose endorsement was considered critical to getting Democrats on board with the U.S.-Mexico-Canada Agreement, praised the reworked pact Dec. 10 for improving worker protections. Trumka cited newly negotiated rules and enforcement language as key to getting him and Democratic leaders to end their holdout on the deal to replace the North American Free Trade Agreement. It’s the first trade deal the AFL-CIO has endorsed since 2001.

But at least one prominent AFL-CIO member, the International Association of Machinists and Aerospace Workers, quickly came out in opposition to the pact, while other unions were noncommittal. That could be a sign of further cracks in labor support for the agreement, which is considered a must have for the Trump administration and for moderate Democrats facing close reelection battles next year.

“As we have made clear from the very beginning of this process, any acceptable deal must effectively address the continued outsourcing of hundreds of thousands of jobs to Mexico,” said IAM President Robert Martinez, Jr., in a statement. “Unfortunately, we are not aware of provisions in the newly negotiated agreement that effectively address this matter, especially when it comes to aerospace and other manufacturing sectors.”

Still, Trumka’s work with Democrats in pressuring the administration and the partner nations to agree to tougher labor provisions was lauded by House leaders at a press conference Dec. 10 announcing changes to the USMCA.

Rep. Richard Neal, chairman of the House Ways and Means Committee and leader of House Democrats’ USMCA negotiating committee, called the revised agreement a “triumph for organized labor.” Neal told Bloomberg Law that “90 percent of the labor movement” is on board with the agreement.

“Their opposition, I hope, could be ameliorated by other issues,” Neal said of the Machinists’ public stance.

The full text of the revised agreement will be released “soon” for further vetting by members, Neal said. A House floor vote is set for next week.

Thea Lee, president of the left-leaning Economic Policy Institute and a former AFL-CIO official who focused on trade policy, called the revised USMCA “weak tea, at best,” according to a prepared statement.

Trumka Call

Trumka briefed union leaders on the negotiated changes to the deal during a Dec. 9 phone call with the union federation’s executive council.

No vote was taken, according to people who participated in the call and requested anonymity to discuss the internal process. An AFL-CIO spokesman said the deal as amended “was backed by a clear majority” on the call.

But other AFL-CIO member unions reserved judgment following the Dec. 10 announcement until they could review the full pact.

“Once the text is released, we will evaluate the agreement based on the standards we have set for trade agreements that benefit working families, not just multinational corporations and investors,” the Communications Workers of America said in a statement.

The United Steelworkers officially joined the AFL-CIO in backing the revised deal, hours after House Democrats unveiled some of the details. The USW is one of the AFL-CIO’s 55 member unions, representing a combined 12.5 million workers.

USW President Thomas Conway said the updated agreement “is better than the original USMCA and certainly better than NAFTA,” but he added that labor provisions must be diligently enforced.

“No one should overplay this agreement’s impact, or underestimate the work that remains to be done,” Conway said.

Labor Standards

The proposed deal now includes stronger enforcement standards and a streamlined process for resolving disputes between the U.S., Mexico, and Canada, according to a Ways and Means Committee memo highlighting key elements of the agreement. The labor enforcement standards are to take effect immediately upon the agreement’s enactment.

Negotiators removed language allowing a responding party to block the formation of a dispute settlement panel and nixed wording in the “forced labor provision” that had made it effectively unenforceable.

An interagency committee will monitor Mexico’s implementation of labor reforms and compliance with labor obligations. The deal establishes regular reporting requirements to Congress. The frequency of those reports are unclear.

Labor representatives will be based in Mexico to provide on-the-ground information about the country’s labor practices. Neal said Americans will be able to access Mexican plants for monitoring purposes.

The added labor enforcement measures also cover all manufactured goods and services traded between the U.S. and Mexico. Penalties will be levied on goods and services not produced in compliance with the freedom of association and collective bargaining obligations, the labor enforcement provisions of the memo said.

Rep. Andy Levin (D-Mich.), vice chairman of the House Education and Labor Committee, said in a statement that he fears the deal doesn’t go far enough to protect workers in Mexico and prevent companies from skirting responsibilities by moving jobs across the border.

“I fear that this NAFTA 2.0 will not provide Mexican workers with the freedom to organize independent unions and bargain for a better life on any scale—and in the export sectors that matter most to U.S. workers in particular,” he said. “If the new agreement fails to accomplish that, we will spawn another generation of justifiably alienated U.S. workers. I will not stand for that.”

The U.S., Mexico and Canada on Dec. 10 signed amendments to the proposed free-trade agreement reflecting the negotiated changes, paving the way for the three countries’ legislatures to ratify the deal. But the USMCA still has several steps to go before reaching the finish line.

Senate Majority Leader Mitch McConnell (R-Ky.) dashed any hope for Senate passage of legislation approving the deal before the end of the year. McConnell said Dec. 10 his chamber won’t take up the measure next week, and floor consideration will have to wait until after any impeachment trial.

—Josh Eidelson (Bloomberg News) contributed to this report

(Updated with details about the AFL-CIO call.)

To contact the reporters on this story: Ben Penn in Washington at bpenn@bloomberglaw.com; Jaclyn Diaz in Washington at jdiaz@bloomberglaw.com

To contact the editors responsible for this story: Chris Opfer at copfer@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com

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