Passage of Mexican labor reform legislation was a key commitment included in the U.S.-Mexico-Canada Agreement.
Mexico’s Congress passed historic labor reform legislation Monday in line with Mexico’s commitments under the U.S.-Mexico-Canada Agreement (USMCA), but the House Ways and Means Committee was short on details when asked whether it paves the way for consideration of USMCA implementing legislation.
The Trump administration has completed all the necessary statutory procedures clearing the way for sending USMCA legislation to Capitol Hill for consideration, but letters from Ways and Means to the Office of the U.S. Trade Representative have called for more engagement with the Trump administration regarding the agreement’s labor and environmental provisions, and enforceability of those provisions.
“The passage is a good and necessary step, but our members still have outstanding concerns with the renegotiated agreement,” a Ways and Means aide said in an email and referred to concerns stated in the letters.
Specific labor concerns included that Mexico hadn’t passed labor reform legislation and that the existing state-to-state dispute settlement mechanism that would enforce labor commitments has been frustrated over the course of NAFTA by parties wishing not to be sued.
In 2000, Mexico initiated a proceeding under NAFTA’s state-to-state dispute settlement provisions against the United States’ supply management program for domestic sugar, but the U.S. essentially blocked establishment of a panel, as its roster of potential arbitration panelists had already expired by that time, and the U.S. refused to appoint new members.
USMCA parties can ensure labor enforcement has teeth if they simply submit their lists of panelists at the same time USMCA is ratified, Mexican Ambassador to the U.S. Martha Barcena Coqui said last week.
Throughout the history of NAFTA, congressional Democrats’ labor concerns have mostly centered around Mexican labor law and incentives for companies to shift production from the U.S. to Mexico.
Passed Monday by a vote of 120-0 in Mexico’s Senate, Mexican labor reform legislation takes aim at the country’s existing system of protection unions, long a bone of contention for NAFTA critics, and requires Mexican officials to review 700,000 existing union contracts in four years. The legislation also has passed Mexico’s lower house of Congress.
The Mexican government is working on a road map to implement the labor legislation, and some of the institutions to be created by the legislation should be in place next year, Barcena said. She added that Mexico will ensure that existing union leadership is overhauled.
Barcena said she hopes the U.S. organized labor movement will collaborate with Mexico as it reviews the protection contracts. AFL-CIO has said it will oppose USMCA absent a renegotiation of labor provisions, but AFL-CIO President Richard Trumka last week seemed to move the goal posts even farther, saying he wants to see Mexico’s ability to amend the 700,000 protection contracts in the required four-year time span.
“These reforms will greatly improve Mexico’s system of labor justice and are exactly what labor leaders in the United States and Mexico have sought for decades,” U.S. Trade Representative Robert Lighthizer said in a statement. “As we move forward with the ratification of USMCA, the Trump administration will work closely with members of the United States Congress and the Mexican government to ensure these reforms are implemented and enforced.”
