Executive Summary for Public Report of Review of NAO Submission No. 9702

PURPOSE OF THE REPORT

Submission No. 9702 was filed pursuant to the North American Agreement on Labor Cooperation (NAALC) on October 30, 1997, by the Support Committee for Maquiladora Workers (SCM), the International Labor Rights Fund (ILRF), the National Association of Democratic Lawyers (ANAD) of Mexico, and the Union of Metal, Steel, Iron, and Allied Workers (STIMAHCS) of Mexico.

On February 9, 1998, an addendum on health and safety issues to the submission was filed by the Maquiladora Health and Safety Support Network (MHSSN), Worksafe! Southern California (WSC) the United Steelworkers of America (USWA), the United Auto Workers (UAW), and the Canadian Auto workers (CAW). A public hearing was held in San Diego, California, on February 18, 1998.

The report will be issued in two parts. The instant report addresses the freedom of association issues raised in the submission. The report addressing the health and safety issues will be issued at a later date.

The NAO recommends that the Secretary of Labor consult with the Secretary of Labor and Social Welfare of Mexico on the matter.

SUMMARY OF SUBMISSION

Submission No. 9702 raises freedom of association issues at an export processing plant in Tijuana, Baja California, Mexico. Beginning in April, 1997, workers at the Han Young de Mexico, S.A. de C.V. factory began to organize a union. Han Young assembles truck trailer chassis for Hyundai Precision America, a subsidiary of the Hyundai Corporation of Korea.

The submitters maintain that the workers wanted to form a union to address issues of safety and health, job classification and wage scales, low wages, annual bonuses, profit sharing, lack of dining facilities, and the lack of a company doctor at the plant. After the organizing effort began, the workers were informed that they were already represented by a union which would handle their complaints.

Many of the workers professed to be unaware of the existence of a union at the plant. Though the union had supposedly negotiated a collective bargaining agreement, the submitters maintain that workers had never seen it and were unaware of its provisions. This practice of negotiating "protection" contracts, in order to keep authentic unions out of the workplace, is alleged to be fairly common in Mexico, especially in Tijuana.

The submitters allege that the company initiated reprisals against workers for their organizing efforts, including threats, shift changes, harassment, and the dismissal of twelve workers. The submitters assert that this was done in complicity with the established union at the plant.

Despite these measures, according to the submitters, the workers persisted in their effort and an election was held on October 6, 1997, to determine representation among the two unions. The election was conducted amidst widespread irregularities, according to the submitters, including votes by recently hired workers who should not have been permitted to vote, as well as by management employees. Despite this, the workers union (STIMAHCS) won the representation election by a vote of 54-34.

On November 10, 1997, the Conciliation and Arbitration Board (CAB) which adjudicates individual and collective labor disputes, nullified the results of the election on the grounds that STIMAHCS had failed to adequately substantiate that it had the support of the majority of the workers and that it lacked the proper registration. The CAB ordered that union representation remain with the established union. STIMAHCS filed an appeal to the courts and four workers went on hunger strike in protest.

Following considerable press coverage and international attention, including the review by the NAO, Mexican Federal authorities intervened and facilitated a new election on December 16, 1997. This election was also won by the workers' union and it was awarded representation rights. The dismissed workers were reinstated and the hunger strikers ended their fast.

According to the submitters, although negotiations between the union and the company have begun, the company continues its harassment against the workers who supported the independent union, including the dismissal of another eleven workers, and has hired additional workers to dilute the support for the independent union. The CAB has ordered a new representation election to be conducted at a date to be determined, at which another one of Tijuana's established unions will be afforded the opportunity to challenge the new workers' union.

ANALYSIS AND DISCUSSION

Article 3 of the NAALC commits the Parties to enforce their labor laws. The Mexican Federal Labor Law provides for a representation election as a means to determine the majority union in the workplace. However, irregularities that were permitted to take place in the first representation election and questionable legal determininations made by the CAB in initially awarding representation rights, raise questions about Mexico's enforcement of its labor law and its impartiality in protecting workers from employer retaliation for union activities.

Article 5(1) of the NAALC commits the Parties to ensure that labor tribunal proceedings are fair, equitable, and transparent. In this case, the proceedings of the CAB were generally consistent with the Federal Labor Law and the provisions of Article 5(1). The parties to the case were afforded the opportunity to present their respective positions and submit the appropriate evidence and the results were made available to the public. The elapsed time period in the proceedings was not unreasonably excessive. However, the delay of the CAB in issuing official notification of the certification of STIMAHCS as the collective bargaining representative is a matter of concern.

Article 5(4) of the NAALC commits each Party to ensure that its labor tribunals are impartial, independent, and do not have a substantial interest in the outcome of the proceedings before it. The review of this submission as well as of previous submissions, ministerial consultations, and other information, indicates that Mexico's local CABs have not been consistent and have not applied uniform criteria in adjudicating collective disputes between established unions aligned with the ruling political party (the PRI) and independent unions.

The Government of Mexico apparently recognizes that a number of shortcomings exist in its labor tribunal system and has undertaken initiatives to address them. These include a statement of principles entitled The New Labor Culture and a five-year policy and planning document entitled the Program for Employment, Training and the Defense of Labor Rights: 1995-2000.

FINDINGS AND RECOMMENDATION

The NAO finds that Mexico's Constitution and Federal laws protect the freedom of association of workers to organize and join the unions of their choice. However, the placement of obstacles to this right by local CABs is not consistent with Mexico's obligations under Article 3 of the NAALC.

While the proceedings in the instant case were conducted in a transparent and expeditious manner, consistent with the NAALC, provisions of the Federal Labor Law on representation elections are unclear and actions of the local CAB appear inconsistent with Mexico's obligations under Articles 5(1), 5(2)(b), and 5(4) of the NAALC.

The Government of Mexico apparently recognizes a number of shortcomings in its labor tribunal system as demonstrated by the Federal Government's initiatives to improve the performance of the CABs. However, it is apparent that independent unions can experience difficulty in obtaining registration and collective bargaining rights.

The NAO therefore recommends that the Secretary of Labor engage in ministerial level consultations with the Secretary of Labor and Social Welfare of Mexico to discuss strategies being considered by the Government of Mexico to address these issues as well as other measures needed to ensure that workers' freedom of association and right to bargain collectively are protected.