This is a very interesting development related to labor issues tieing into Latin America, something that seems to be on the rise with recenet labor unrest in Mexico.
The Trump administration asked a federal judge to invalidate key results of the International Longshore and Warehouse Union’s 2018 election, arguing that the union did not count nearly 2,000 ballots from members in Panama.
In a complaint filed in U.S. District Court in Northern California, the Labor Department asked the judge to require a new election for ILWU president, vice president, secretary-treasurer and the international executive board officer for Panama. The margins of victory for those positions were less than the 1,970 Panamanian votes that were not counted, DOL said.
Willie Adams, the first black president of ILWU, won by 393 votes. The union board voted 15-6 in October 2018 to certify the results despite the uncounted ballots from Panama, according to news reports. A union spokesperson did not respond to requests for comment Thursday.
A postage mix-up prevented 1,970 dock workers and ship pilots in Panama from mailing their ballots to the U.S. More than 1,000 of those ballots were shipped in a box and arrived in time to be counted, but the union board “decided to disqualify the ballots because they were not voted in accordance with” its bylaws, according to the complaint. In addition, the instructions were not “fully or accurately” translated to Spanish, DOL said.
DOL argues that ILWU violated the Labor-Management Reporting and Disclosure Act, which requires unions to provide every member the opportunity to vote.
ILWU represents port workers in the U.S. and Canada, and in 2011 joined with dock workers and ship drivers along the Panama Canal. The union reportedly sought to increase its bargaining power, worried that a planned widening of the canal could siphon business from West Coast ports.
Mexico is finally poised to pass a major labor reform law this month, which would remove a major roadblock House Speaker Nancy Pelosi has said is preventing Congress from considering the new North American trade pact.
A top Mexican official assured U.S. lawmakers that Mexico plans to pass the legislation by the end of April. This move would check off one of Mexico’s commitments under the replacement deal for NAFTA, the U.S.-Mexico-Canada Agreement, that President Donald Trump has championed.
“Let’s knock down USMCA if Mexico doesn’t pass that legislation, because yes, we are going to pass it,” Jesús Seade, Mexico’s undersecretary for North America, declared during a press conference last week.
Pressure has heated up in recent weeks for the Mexican Congress to pass the labor reform bill, as a growing number of Democrats on Capitol Hill have indicated that they are waiting for Mexico to make the necessary labor law changes before they consider the new deal. Democrats have long criticized the 25-year-old NAFTA for being toothless on workers’ rights in Mexico.
Mexico’s proposed labor changes would completely overhaul the country’s existing union structure, which has long been criticized for failing to protect workers. The majority of unions in Mexico are not independent and have been regarded as corrupt by U.S. union leaders.
The new law sets out to protect workers’ rights to collective bargaining. Secret votes would also be required at companies when a labor pool considers whether to unionize.
Addressing Mexican labor laws isn’t the only aspect of USMCA that Democrats have complained about. Several lawmakers are also worried that the deal’s labor and environment standards are not strongly enforceable. Some also have reservations over provisions they say could lock in high prescription drug prices.
Still, Mexico’s passage of the new law would be a major step toward the deal getting a vote before Congress.
Pelosi said last week consideration of USMCA would “take some time,” adding that lawmakers need to “see the evidence of what’s happening, not only that they pass the bill [in Mexico], but that they implement the policy.”
Several other lawmakers, such as Sen. Sherrod Brown (D-Ohio), will be closely monitoring the law’s results as well.
Brown agrees with Pelosi “that both enactment and implementation of labor law reforms that comply with the standards outlined in the agreement are necessary before Congress should consider the new NAFTA,” one of his staffers told POLITICO this week.
The most recent draft has been well-received by U.S. labor leaders, who are considered a crucial group needed to get Democrats to support the deal.
“Upon first review, this new bill is an improvement and meets a key criteria of ensuring workers can vote on their collective bargaining agreements,” said Celeste Drake, trade policy specialist for the AFL-CIO.
A U.S. labor representative told POLITICO recently that the previous draft of the Mexican labor bill fell short of the requirements outlined in Annex 23 of the new USMCA language. Some of the concerns included that the text did not fully outline that Mexico must have an independent body in place to register union elections and help resolve labor disputes tied to unions, this representative said.
The country’s major union organization, Confederation of Mexican Workers, has long been accused of entering into collective bargaining agreements that were signed between companies and unions without workers’ consent.
The current labor proposal would create a mechanism for all collective bargaining agreements to be renegotiated within four years of the law’s passage.
Another issue was whether the previous draft bill ensured that labor courts in Mexico cannot “unfairly extend and delay hearings” to avoid having to weigh in on union representation issues.
Drake cautioned that AFL-CIO will continue to review the bill, “as well as the mechanisms and resources that Mexico puts in place to ensure these changes make the rights to organize and negotiate not just a promise but a reality.”
“Our standard is you hit the bar on everything in Annex 23 totally, or this process should stop dead in the water,” she told POLITICO recently.
Mexican President Andrés Manuel López Obrador and his administration have repeatedly said that Mexico would deliver on its promise to overhaul its workers rights regulations. López Obrador, a left-leaning populist who took office in December, made workers’ rights and labor justice a centerpiece of his presidential campaign.
“There’s a coincidence of opinion with López Obrador and the Democrats in U.S. on this — in the sense of wanting to strengthen the protection of workers’ rights,” Kenneth Smith Ramos, chief NAFTA negotiator under former Mexican President Enrique Peña Nieto, told POLITICO.
The labor law is important for USMCA, but “it’s also very important as a public policy piece for the López Obrador administration, so it will happen,” Smith Ramos added.
The Mexican government last week submitted a final draft of the legislation for Mexican lawmakers to review. The bill, which was first introduced in December, was “frozen for a while because of some technicalities,” Seade said.
A top Mexican lawmaker, Mario Delgado Carrillo, said Sunday that passing the law is a main priority for Mexico’s legislature, which is controlled by López Obrador’s party.
It remains to be seen how the Trump administration and lawmakers like Pelosi will view Mexico’s labor changes.
Seade said once the labor law passes, it will be important to find out how long Pelosi and other U.S. lawmakers want to monitor implementation before declaring the new law a success.
“Implementation is forever,” Seade said. “The law will be passed at the end of this month and the implementation starts immediately. There’s things that happen immediately, and there’s things that are scheduled to happen over time.”
From Politico Pro By Megan Cassella
A push to increase wages and tighten labor standards in Mexico — one of the Trump administration’s top priorities in a modernized NAFTA — is likely to be a no-go issue for the Mexican government that has the potential to scuttle the renegotiation, two former Mexican negotiators warned on Tuesday.
“Wages, I think, should be out of any kind of discussions and should be a red line and a deal-breaker,” Francisco de Rosenzweig, a former deputy trade minister for Mexico who led the country’s negotiating team for the Trans-Pacific Partnership, said at an event in Washington hosted by the Wilson Center. The issue, he added, “should not be considered even as a possibility to negotiate.”
Mexico has instituted several labor reforms and improved its legal framework on labor issues since NAFTA was first negotiated, Rosenzweig said, adding that additional changes that Mexican President Enrique Pena Nieto submitted recently are still “on the way.” He described current labor provisions that were written in side agreements as positive developments, and said Mexico would be comfortable moving those provisions into the main text of an updated NAFTA agreement, as the U.S. wants. But going beyond that and tightening those standards would prove more difficult and could endanger the talks, he said.
“We don’t know what other provisions the U.S. may want to submit to Canada and Mexico, so we will take a look,” said Rosenzweig, who is now a partner in the Mexico City branch of the law firm White & Case. “But in the end, it’s about reaching balances,” he said. “It’s not only about the U.S. Congress. It’s about the Mexican [Senate] and the Canadian Parliament, too.”
The United States, in its detailed negotiating objectives, listed bringing those labor provisions into NAFTA’s core text as its top labor-related priority. But it also outlined nine other labor initiatives, including requiring countries to establish rules to enforce labor laws surrounding working conditions and minimum wages. The Trump administration also wants to ensure that NAFTA countries’ labor standards do not affect trade or investment between the parties.
Top U.S. officials have reinforced the point that labor standards in Mexico will be a primary topic of discussion throughout the talks, slated to begin on Wednesday. Back in June, U.S. Trade Representative Robert Lighthizer told members of the Senate Finance Committee that with regard to labor standards, “certainly they will be one of the very first things that we talk to them about.”
In an example of a potential negotiating point where labor standards would figure prominently, POLITICO reported earlier Tuesday that U.S. negotiators would submit a proposal during the first round of talks to make it easier for U.S. produce farmers by region to protest allegations of dumping on Mexico’s part. Many U.S. produce growers complain that the substantially lower labor costs in Mexico help its produce exports undercut the price of produce grown in the U.S.
While it is not known how the Trump administration may propose to achieve its priorities on labor during the talks, the concern is that “apparently Mexico is like the bad guy in the arena because we have lower labor costs,” said Luz Maria De La Mora Sanchez, a former official at Mexico’s Foreign Affairs Ministry who was part of the original team that negotiated NAFTA in the early 1990s.
“Wages in Mexico are lower than in the U.S. That’s a fact,” she said at the Wilson Center event. “The fact that that exists doesn’t mean we have an overt trade advantage.”
Mexico has to work hard to close that gap, she said, but doing so will require education, innovation, improvements in productivity — and not new trade agreements.
“My concern with respect to labor is that the U.S. comes up with a proposal that really tries to intervene in minimum wages and labor markets, which cannot be solved through a trade negotiation,” she said. “We have to be very careful on not offering solutions that may end up not getting us anywhere.”