• ZERO RISK: The inclusion of two bilateral mechanisms in the new regional trade agreement (USMCA) to allow the US and Canada to monitor union elections and collective agreements in Mexico via panels does not represent a risk to investment, said Mexico’s Labor Minister, Luisa María Alcalde.
• NEW: “We can no longer support a model of ‘protection contracts’ (with ghost unions). (Companies) that insist on that will face consequences under our own laws. And if this reaches a (USMCA) panel, the company that doesn’t want to comply will have sanctions at that level too”, said Alcalde.
• REFORM: Earlier in May, Mexico enacted a landmark labor reform that mandates among other things: a review all collective labor agreements in just 4 years, the transferring of labor justice to a set of new independent courts and that creation of a new autonomous body to oversee union elections.
• WARNING: “While the initial proposal to bring inspectors to validate the implementation of the labor reform in Mexico was not approved, I do believe that in some cases or in some industries, such as the automotive and mining, this can be risky”, warned Germán de la Garza, a Mexican labor lawyer.
