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With a Little Help From American Friends, Mexican Car Workers Choose New Independent Union

Insight
February 8, 2022
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Insight
February 8, 2022

In May 2019, Mexico’s Congress passed a new law to ensure that Mexican labor standards conformed with those of the International Labour Organization Convention, the Trans-Pacific Partnership Agreement and the new North American Free Trade Agreement (“USMCA”), all of which require their signatories to ensure that workers have collective bargaining rights that satisfy certain standards, including having the bargaining representative of their choice. The purpose of the law was to address a longstanding concern that traditional unions in Mexico often provided insufficient representation to workers who often receive little more than the minimum wages they would earn without labor contracts.

Initially, there was little evidence that traditional unions were being challenged following the implementation of these new standards. That, however, appears to have changed, at least with respect to some U.S. companies operating in Mexico. The USMCA established an Interagency Labor Committee, which has the power to refer complaints of denials of labor rights in Mexican facilities to the U.S. Trade Representative, who, in turn, may take enforcement action. As a result of a petition filed by the U.S. Trade Representative, General Motors entered into a plan to address labor practices at its facility in Silao, Mexico. Last week, a new independent union supported by international activists won an election to represent the workers at that plant.

What is not yet clear is whether these new independent unions will be successful at organizing workers at other companies without the support of the U.S. Trade Representative. The Confederation of Mexican Workers (Confederación de Trabajadores de México) — which previously represented the GM workers — still remains the largest union in Mexico. There is little evidence that it is about to cede its power to different unions without putting up a fight. However, whether the GM election will motivate workers at other companies to challenge their incumbent unions is yet to be seen.

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This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.