GSP WORKER RIGHTS: EMBASSY SUPPORTS CONSULTATIONS

UNCLAS SECTION 01 OF 02 GUATEMALA 000379

SIPDIS

SENSITIVE

DEPT FOR WHA/CEN AND WHA/PPC
USTR FOR JON ROSENBAUM AND BUD CLATANOFF
USDOL FOR ILAB: JORGE PEREZ-LOPEZ

E.O. 12958: N/A
TAGS: ELAB ETRD PHUM GT
SUBJECT: GSP WORKER RIGHTS: EMBASSY SUPPORTS CONSULTATIONS
OVER REVIEW

REF: STATE 35553


1. (SBU) Summary: Embassy believes that bilateral
consultations would be as productive as a formal GSP review
of Guatemalan worker rights. Although the labor rights
situation is bad, it is not worsening and the GOG has in fact
taken steps to protect labor rights since the last review was
suspended. Furthermore, the political effects of a formal
review are uncertain. The GOG is in an election year and is
reeling from recent USG narcotics de-certification. Adding
the threat of withdrawal of GSP benefits could provoke a
backlash against USG "blacklisting." We suggest the
Department support an alternative strategy of bilateral
consultations to promote labor rights improvements. We have
already begun this process by signaling key GOG interlocutors
privately, and have built it into our Mission Program Plan.
We welcome USTR participation in these consultations in the
broader context of CAFTA negotiations. If decision is made
to conduct a formal review, however, we will of course work
to make it a sucesss. End Summary.

The GOG has "Taken Steps"
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2. (SBU) The AFL-CIO and International Labor Rights Fund
petitions on Guatemala correctly identify major weaknesses in
the protection of labor rights in Guatemala. Labor rights
violations continue to be common and serious here, and must
change for Guatemala to be a full partner under CAFTA. Most
worrisome to us is the situation of impunity for those who
attack labor leaders, the ineffective labor justice system,
and particularly egregious cases of non-reinstatement of
illegally fired workers. The petitions do not, however, take
into account positive steps to protect worker rights taken by
the GOG since the last USTR review ended in May 2001. These
include:

-- creation of a Special Prosecutor's Office to Investigate
Attacks on Union Members in 2001;

-- creation of a consensual National Plan for Occupational
Health and Safety in 2002;

-- cooperation with the ILO's International Program to
Eliminate Child Labor in several sectors of the economy;

-- revitalization of the Labor Ministry under ex-minister
Godoy;

-- increased inspections, with the result that the first year
of implementation of the Ministry's newly authorized fines
totals more than the labor courts have imposed in 50 years;

-- resolution of the high-profile DYMEL dispute.

Movement on Issues Mentioned in Petitions
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3. (SBU) In addition, several problems in the petitions have
been resolved or require clarification. For example:

In the AFL-CIO petition;

-- The Jalapa Coca Cola's local bottler recently agreed to a
collective bargaining agreement with its union;

-- Jalapa municipal workers struck in 2002, but returned to
work after concessions from the mayor;

-- Labor relations at the Choi Shin-Cimatextiles maquila have
normalized since management instituted regular meetings with
its unions, which have failed to organize 25% of the workers;

-- With GOG support, ILO/IPEC has launched a new project to
combat child labor in the Guatemala City municipal dump;

In the ILRF petition;

-- The petition incorrectly asserts that the Labor Ministry
has failed to use its new power to levy fines;

-- The SITRABI case in Morales, Izabal is resolved. Further
attacks have occurred in the area over illegal land
occupations, not labor rights;

-- The existence of "solidarity associations" does not
violate the right to association;

-- Public sector doctors, health workers and banana workers
held unofficial work stoppages in 2002, without GOG
intervention; and

-- discrimination is not grounds for GSP review.

An Alternative Path To Achieve Review Goals
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4. (SBU) We believe that aggressive bilateral consultations
with the Labor Minister, Foreign Minister, Attorney General
and Judicial Branch could achieve the same ends as a USTR
review. These consultations, which we have already
initiated, will focus on achieving progress in labor justice,
investigation of unresolved crimes against union leaders, and
reinstallation of illegally fired workers. New
opportunities, including the new Labor Minister Victor
Moreira's legislative priorities (e.g. to combat gender
discrimination) could also be incorporated in our
consultation efforts. As an Embassy, we are committed to
make this strategy work and will highlight it strategy in our
Mission Program Plan, which is about to be submitted.

Comment
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5. (SBU) In sum, we think we can best advance labor rights
through bilateral consultations. If, however, Washington
agencies conclude otherwise, count on our full support.
Hamilton