Press Release: Mexico Agrees to Investigate USMCA Labor Rights Compliant Against Panasonic Reynosa Factory Filed By Independent Mexican Union SNITIS and Rethink Trade

Washington, D.C.The Mexican government has agreed to investigate alleged violations of workers’ USMCA-protected labor rights at a Panasonic Automotive Systems de Mexico S.A. de C.V. plant in response to a request by the U.S. Trade Representative (USTR) that came in response to a petition filed on April 18 by Sindicato Nacional Independiente de Trabajadores de Industrias y de Servicios Movimiento 20/32 (SNITIS) and Rethink Trade.  Under the USMCA Rapid Response Mechanism (RRM), Mexico has 45 days to report the findings of its review to the USTR. If Mexico agrees with the U.S. allegation that there was a denial of rights at the plant where workers voted for an independent union but Panasonic continues to recognize an old “protection” union and a collective bargaining agreement not approved by workers, the two parties could enter talks on remediation. If not, the U.S. government could request the establishment of a USMCA panel to review the case. This is the third Rapid Response Mechanism case initiated by USTR under the United States-Mexico-Canada Agreement (USMCA) in over a year. Mexican workers denied their fundamental right to organize and bargain for better wages and conditions have won RRM cases against GM and Tridonex. In response to the Mexican government announcement:

Susana Prieto Terrazas, labor leader and member of the Mexican Congress said: “It is a great feat that Mexico admits the USMCA-guaranteed labor rights violations complaint raised by the U.S. government and initiated by SNITIS and Rethink Trade. We hope that now the Mexican government acknowledges the violations and works towards reestablishing workers’ rights to freedom of association and union democracy. This case is so clear that it shouldn’t take 45 days of investigation for Mexico to determine if there has been a denial of rights. The Mexican government must promptly acknowledge the violations.”

Daniel Rangel, an attorney with Rethink Trade who petitioned for a case to be initiated, said: “After a resounding electoral vote, an RRM complaint by the United States and now Mexico’s admission of the complaint, Panasonic still refuses to recognize the will of its workers and insists on imposing a dreaded protection union the workers rejected. Mexico’s decision is welcomed but must be promptly followed by its acknowledgment of labor rights violations at Panasonic and swift negotiations by the U.S. and Mexican governments to redress the situation. The only acceptable outcome is Panasonic recognizing SNITIS as the workers’ legitimate representative and negotiating in good faith with the independent union.”

BACKGROUND: In October 2021, workers rejected an existing labor contract at Panasonic’s Reynosa facilities during the USMCA-required legitimization process. A dire labor conflict erupted as the firm began colluding with an employer-captured “protection” union, affiliated to the Confederación de Trabajadores de México (CTM), and local authorities to try force a new CBA on workers that they have not approved. That contract was negotiated by the CTM union that does not lawfully represent them.

After workers voted down the preexisting CBA last fall, SNITIS filed for a certificate to represent the Panasonic employees and negotiate a new contract. The CTM union, Sindicato Industrial Autónomo de Operarios en General de Maquiladoras de la República Mexicana (SIAMARM), also petitioned to do so. Since two unions were disputing the right to represent the workers, Mexican federal authorities called for a union election to be held on April 21 and 22, 2022.

The USMCA RRM petition that Mexico accepted today was filed on April 18, 2022 by independent union Sindicato Nacional Independiente de Trabajadores de Industrias y de Servicios Movimiento 20/32 (SNITIS) and Rethink Trade. Tensions had escalated at Panasonic’s Reynosa plant leading to the April 21-22 union election. Panasonic fired workers who supported independent union SNITIS and tried to impose an unapproved collective bargaining agreement made with a contested “protection” union linked to the notorious CTM federation that is tied to a conservative political party.

Despite a threatening environment created by the CTM union and its reported attempts to influence the outcome of the election by bribing workers in exchange for votes, Panasonic’s workforce voted overwhelmingly in favor of independent union SNITIS. SNITIS received 1,200 votes while only 390 eligible workers casted their votes for CTM. Find links to video of CTM officials threatening the independent union and more about the recent vote, here.

After the vote, Panasonic announced that “it respected and supported its employees’ right to free association and looked forward to working with SNITIS once it is officially registered as the factory’s new union.” Yet Panasonic continues to interact with the protection union as if it had won the election even after SNITIS was recognized as the legitimate representative of the workers by the government.

In violation of its obligations under Mexico’s 2019-reformed Federal Labor Law, Panasonic still is allowing CTM staff to go into the plant and continues to transfer workers’ union dues to the protection union. Before the vote, the company had circulated a CBA signed with the CTM union, filed it with the local Conciliation and Arbitration Board – which did not have the legal authority to accept it – and colluded with the CTM to demand that workers endorse the bogus contract. Even after the outcome of the vote was certified by Mexican federal authorities, Panasonic has shown no intention of rescinding the illegal contract signed with the CTM union.

On May 18, 2022, United States Trade Representative Katherine Tai today announced that the United States has asked Mexico to review whether workers at the Panasonic Automotive Systems de Mexico facility in Reynosa, State of Tamaulipas, are being denied the rights of free association and collective bargaining.

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