U.S. Asks Mexico to Probe Labor Rights at GM Truck Plant (2)

May 12, 2021, 9:11 PM

The U.S. asked Mexico to review alleged denial of workers’ rights at a General Motors Co. truck plant in central Mexico, the first time Washington is self-initiating a labor dispute under the new trade pact between the countries.

United States Trade Representative Katherine Tai has asked Mexico to review whether employees at the facility in Silao, Guanajuato, are being denied the right of free association and collective bargaining, the USTR said in a statement released early Wednesday.

Read more: GM’s Giant Pickup Factory in Mexico Embroiled in Labor Fight

“Using USMCA to help protect freedom of association and collective-bargaining rights in Mexico helps workers both at home and in Mexico, by stopping a race to the bottom,” Tai said. “It also supports Mexico’s efforts to implement its recent labor-law reforms. I commend the Mexican government for stepping in to suspend the vote when it became aware of voting irregularities.”

Mexico will review developments at the plant, the economy and labor ministries said in a statement Wednesday. The Labor Ministry added it will reinstate the process to legitimize the collective-bargaining agreement at the plant, and reiterated its commitment to restoring union and collective-bargaining rights.

The ministry in April said it shut down a union-led vote at the plant after discovering unused ballots had been destroyed. When it asked the union to deliver for inspection the votes that had already been cast -- about half of the 6,494 unionized workers had voted -- the syndicate refused, according to a preliminary ministry report.

The Biden administration’s trade policy is focused on workers and enforcing existing commitments by the U.S.’s partners. Democrats and American labor unions made strong worker rules and enforcement mechanisms for Mexico a key demand to win their support for the U.S.-Mexico-Canada Agreement that went into force last July.

Tai is due to meet her counterparts -- Mexico’s Tatiana Clouthier and Canada’s Mary Ng -- in a virtual gathering on May 17 and 18, Mexican daily Milenio reported Tuesday. Tai referred to the meeting taking place next week when she addressed a Senate Finance Committee hearing Wednesday.

Read more: GM’s Giant Pickup Factory in Mexico Embroiled in Labor Fight

Under the USMCA’s rapid-response labor mechanism, the first step is for the U.S. to submit a request that Mexico review whether there is a denial of rights and attempt to address any issues it finds, the USTR said. If the countries are unable to agree that the issue has been resolved, the U.S. may request the establishment of a so-called rapid-response labor panel to determine whether there has been a denial of collective-bargaining rights.

Tai has directed the Treasury Department to suspend the final settlement of customs accounts related to entries of goods from GM’s Silao facility.

GM Cooperating

On Tuesday, three U.S. lawmakers wrote to GM Chief Executive Officer Mary Barra, asking her for details on the auto company’s role in what happened and whether the company will commit to ensuring future votes are independently verified.

Bill Pascrell, the New Jersey Democrat who chairs the House Ways and Means Oversight Subcommittee, welcomed the USTR’s move.

“Our trade agreements aren’t worth the paper they’re printed on if they are not enforced to defend workers in Mexico and here in the United States,” Pascrell said in a statement. “Corporations must also be an active participant in respecting labor rights.”

The manufacturer respects and supports the rights of its employees to make a personal choice about union representation, and will cooperate with the U.S. government and the Mexican Labor Ministry to protect the integrity of the process, it said in an emailed response to questions.

“GM condemns violations of labor rights and actions to restrict collective bargaining,” it said. “We do not believe there was any GM involvement in the alleged violations or that any government-approved inspectors were denied access to the facility, and have retained a third-party firm to conduct an independent and thorough review.”

Read more: Labor Unions Lodge First USMCA Complaint Against Mexican Factory

The U.S. action follows information they received through a confidential hotline and is meant to complement Mexico’s efforts on the matter, not implicate the Mexican government in any wrongdoing, a USTR official told reporters. Mexico will have 10 days to respond.

The Biden administration has reached out to GM on the issue, another USTR official said, without providing details.

The GM case is the first initiated by Washington. In another USMCA first, the largest U.S. labor union and other groups on Monday said they lodged a complaint over working conditions at another auto-parts factory in Mexico, the debut case to test whether enforcement provisions in a new trade agreement can help to improve working conditions.

(Updates with Mexico’s response in fourth paragraph.)

--With assistance from David Welch, Nacha Cattan and Dale Quinn.

To contact the reporter on this story:
Jenny Leonard in Washington at jleonard67@bloomberg.net

To contact the editors responsible for this story:
Margaret Collins at mcollins45@bloomberg.net

Ana Monteiro, Scott Lanman

© 2021 Bloomberg L.P. All rights reserved. Used with permission.

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