septiembre 9, 2022

BBB Industries and Manufacturas UV RRLM Cases

What is the RRLM?

In the context of the United States-Mexico-Canada Agreement (USMCA), numerous organizations and unions have pointed out alleged denials of labor rights in Mexico. Their claims relate to problems with union representation and the lack of wage increases after years of stagnation. Since 2020, the U.S. government has filed five rapid response labor mechanism (RRLM) complaints. Thus far, all the complaints have involved the auto sector in Mexico, at companies such as Teksid and Panasonic.

BBB Industries of Mexico

BBB Industries de México is a subsidiary of BBB Industries, LLC, a U.S. company engaged in the manufacture of engines and auto parts. This company has its manufacturing facility in Reynosa, Tamaulipas. In addition, the union that holds its collective bargaining agreement (CBA) is the Confederation of Mexican Workers (Confederación de Trabajadores de México or CTM), which has close ties with political parties.

RRLM's Petition against BBB Industries

A few weeks ago, the National Independent Union of Industrial and Service Workers (Sindicato Nacional Independiente de Trabajadores de Industrias y de Servicios or SNITIS) filed a petition in conjunction with the American Economic Liberties Project’s Rethink Trade program to activate the RRLM. In short, SNITIS alleged that BBB Industries of Mexico failed to guarantee free union votes for its workers.

Among other irregularities, SNITIS told the U.S. government that workers at BBB Industries of Mexico were allegedly intimidated and threatened during their vote on the CTM’s collective bargaining agreement (CBA).

In the petition, SNITIS pointed out numerous procedural flaws in the voting process. In particular, SNITIS mentioned that the vote count exceeded the number of workers, that there were no neutral observers, and that workers did not receive copies of the CBA until the day of the vote.

In addition, SNITIS alleged that BBB Industries representatives pressured workers on the factory and production lines to vote in favor of CTM’s CBA. SNITIS also claimed that the workers were threatened with the loss of their employment benefits, if CTM’s CBA was not approved.

BBB Industries Press Release

In response, BBB Industries issued a press release stating that the company respects the right of workers to vote for a union of their choice. BBB Industries even welcomed any investigation by the U.S. government for greater certainty.

In addition, BBB Industries denied SNITIS’ allegations and said it had followed all the procedures to ensure a fair vote. Simultaneously, a CTM representative stated that BBB Industries follows strict voting protocols, and that CTM was not formally informed of the workers’ complaints.

U.S. Decision on the Petition

In this case, the United States ruled that the SNITIS petition lacked “sufficient and credible evidence of a denial of rights” to trigger the RRLM. This according to a USTR statement.

In response to the denial of the petition, SNITIS mentioned:

"We will continue to demand that the authorities act to redress this denial of labor rights."

VTZ Comments

Notably, the BBB Industries petition represents the first case that the Interagency Labor Committee for Monitoring and Enforcement (ILC) decided not to recomend activating the RRLM because there was insufficient evidence to demonstrate a denial of rights.

Manufacturas VU

On July 21, 2022, the USTR requested Mexico to investigate whether workers at Manufacturas UV’s auto parts plant are suffering labor rights violations. In particular, the USTR wants to verify whether their rights to free association and collective bargaining are being guaranteed at its Piedras Negras, Coahuila, facility.

On June 21, 2022, the Interagency Labor Committee for Monitoring and Enforcement (ILC) received an RRLM petition from the Mexican Workers’ Trade Union League and the Border Committee of Women Workers (Liga Sindical Obrera Mexicana and the Comité Fronterizo de Obreras). The petition alleged that workers at Manufacturas UV are being denied their rights to free association and collective bargaining.

Unlike the petition against BBB Industries, the ILC concluded that there is sufficient and credible evidence of a denial of rights to trigger the RRLM in good faith. As a result, the USTR filed a petition to Mexico requesting to review whether the workers at VU facilities are being denied the right to free association and collective bargaining.

Mexico Agrees to Review Manufacturas UV

On July 26, 2022, the Ministry of Economy formally responded to the USTR and accepted to review the situation of Manufacturas VU. Now, the Ministry of Economy, in coordination with the Ministry of Labor and other institutions, will conduct an investigation of the facts. Mexico has 45 days to provide a report on the case to the United States.

0 days

Mexico's report on the case

Implications

In relation to the petition, the USTR has instructed the Secretary of the Treasury to suspend final clearance of customs accounts related to entries of goods from the Manufacturas UV facility.

“Our continued use of the Rapid Response Labor Mechanism underscores the Biden-Harris Administration’s serious commitment to advancing the rights of workers [...] Workers deserve the right to freely organize for the union of their choice. We look forward to working with the Government of Mexico to promptly address this issue, as we have done in prior instances.”