Labor monitor flags 'weaknesses' in Mexico's drive to boost worker rights

© Reuters. FILE PHOTO: Workers leave after finishing their shift at the GM truck assembly plant as the company gradually restart operations at their Mexican facilities, amid the outbreak of the coronavirus disease (COVID-19), in Silao, Mexico May 22, 2020. REUTERS/S

By Daina Beth Solomon

MEXICO CITY (Reuters) - Mexico's effort to stamp out employment contracts signed behind the backs of workers has "significant weaknesses" and should be reformed, said a U.S. advisory board that monitors Mexico's compliance with a new regional trade pact.

The Independent Mexico Labor Expert Board (IMLEB) flagged a disputed ballot at a General Motors (NYSE:GM) plant as an example of shortfalls in a new Mexican labor law requiring "legitimation" votes in a bid to end the widespread practice of unions and companies signing contracts without workers' knowledge.

That is also a priority of the United States-Mexico-Canada Agreement (USMCA), which replaced the North American Free Trade Agreement (NAFTA) a year ago and includes a mechanism to sanction companies that do not comply with labor provisions.

"The legitimation process continues to have very significant weaknesses," the IMLEB said in a report to U.S. labor officials and lawmakers on Wednesday.

Mexico's labor ministry did not immediately respond to a request for comment. It has said it is looking at ways to improve the process of ratifying votes.

The union-led vote at GM's plant in Guanajuato state in April, in which workers were to choose whether to keep their current collective contract, was scrapped after Mexican officials found problems including destroyed ballots.

One of the board's concerns was that the unions tasked with organizing such votes are not neutral.

"The vote at the General Motors factory in Silao, Guanajuato brought into sharp focus the risks involved," the report said.

The board recommended that government representatives instead conduct the votes, with the authority to investigate and fix problems. It also suggested that a contract be canceled if a union commits any "serious violations" during the vote.

Mexico's labor ministry has told GM's union that it must re-do the vote before Aug. 20 or lose the contract, and is working with the United States on a remediation plan after U.S. authorities filed a complaint under USMCA labor provisions.

Only a fraction of the tens of thousands of contracts in Mexico due to be legitimated under the new rules have so far gone to a vote ahead of a May 2023 deadline, and the labor ministry has said some unions may let contracts expire.

The board warned that even getting through the 80,000 to 100,000 contracts expected to go to a vote could require a massive workload of more than 100 votes per day for two years.