LABOR/MANAGEMENT RELATIONS EXCELLENT AT STANDARD

1. (SBU) Summary: Standard Fruit (Dole) and its union
maintain good relations, with both sides saying that the two
have worked closely together since Hurricane Mitch in 1998.
In fact, Dole has announced an expansion of its investment in
Honduras. While the union has declined in numbers and
strength, it remains a key player in Honduran labor, and is
the base of the important FESITRANH federation which in turn
controls the CTH confederation. It is ironic that Standard
Fruit, long criticized for its actions in this former "banana
republic," now is an excellent example of harmonious
labor/management relations and the benefits foreign
investment can bring to Honduras when both sides bring a
constructive attitude to the table. End Summary.

Dole Management: No Problems with Labor Unions


--------------------------

-



2. (U) Ambassador, Econ Counselor, AID Director, and LabAtt
met with Gerald Brunelle, General Manager, and other top
officials Dole's Honduran subsidiary Standard Fruit of
Honduras and toured Dole's pineapple plantations, processing
plants, and laboratories in La Ceiba May 15. Dole officials
said the Maya Division, which includes both Honduras and
Guatemala, employed 5,500 workers who belonged to five
different unions (the main union being SUTRASFCO). Dole had
approximately 769 salaried personnel and also contracted with
independent producers. Dole's Maya Division produces 10
million boxes of bananas per year and independent banana
producers 4-5 million boxes per year for Dole. Dole also
produces four million boxes of pineapples per year.
Pineapple workers were mainly contract labor (in the past
they had been unionized). Dole recently announced an
important expansion of investment in Honduras.



3. (U) Dole officials said the company had excellent
relations with its unions, especially SUTRASFCO, and noted
that Hurricane Mitch had brought management and labor closer
and had led to improved productivity at the company.
Unionized workers receive some of the best pay and benefits
for workers in Honduras (housing, medical care, etc.);
non-unionized pineapple workers made considerably less (some
only approximately USD 1/day).

Labor Union Praises Dole and Calls for More Investment


--------------------------



--------------------------





4. (U) LabAtt met May 15 with the main Standard Fruit Company
Workers' Union (SUTRASFCO), led by President Carlos Lopez.
SUTRASFCO is a key union in the Federation of Workers' Unions
of Honduras (FESITRANH), the base of power for Confederation
of Workers of Honduras (CTH) Secretary General Dinora
Aceituno. (Note: The CTH is one of three Honduran labor
confederations and is affiliated with the International
Confederation of Free Trade Unions (ICFTU). End Note.)
SUTRASFCO leadership confirmed that the union had had good
relations with Dole ever since Hurricane Mitch in 1998, with
the two sides working together to improve the company and
labor/management relations. The union, which has an upcoming
election, is currently negotiating a new three-year
collective bargaining agreement. The contract will cover
1,300 permanent workers, and for the first time will cover
some temporary workers. Like Chiquita's union (ref A),
Dole's union leaders bemoaned the slow but steady decline in
jobs at Dole, which in turn led to the relative decline of
the union. From 18,000 members in 1954 to 5,000 workers in
1975 (when the railroad and the port in La Ceiba were
nationalized), the union continued to decline, and lost 550
jobs after the devastation of Hurricane Mitch.



5. (U) While there are of course minor problems, union
officials said they had no major problems with Dole. The
major problem was a lack of any other job opportunities in
the La Ceiba area besides Dole. With only a couple of
maquilas in the area, union officials gave an impassioned
pitch for increased private investment.

Pesticide Court Case Continues to Block Settlement


--------------------------



--------------------------





6. (U) Over the past two presidential administrations, the
GOH has been coordinating tripartite negotiations for an out
of court settlement of workers and ex-workers affected by
DibromoChoropropane, or Nemagon, a pesticide used on Dole
banana plantations in the 1960s and 1970s (ref B). In a 1997
judgment against Shell Oil Company, Dow Chemical, and
Occidental Chemical Corporation, a U.S. court charged Nemagon
producers USD 41.5 million for damages due to sterility of a
few hundred Honduran workers, and another 25,000 workers in
11 countries worldwide. Most of the Honduran plaintiffs have
already received payments as a result of this settlement.
However, a larger number of Honduran workers suffering a
wider array of claimed side-effects have been clamoring for
some form of workers' compensation from Dole. A class action
suit against Dole remains in the U.S. courts and has impeded
any national resolution. Despite efforts by a
government-sponsored commission of management, labor, and
government officials from the Ministries of Justice, Labor,
and Health, and a desire by Dole to settle the lawsuit, the
class action suit in U.S. courts has yet to be dropped by the
workers. This has impeded Dole from proceeding with an out
of court settlement in Honduras. SUTRASFCO officials said
they understood Dole's position and hoped that a settlement
could be reached.

Standard Fruit a Positive Example


--------------------------





7. (SBU) Comment. It is somewhat ironic that it Standard
Fruit, long criticized for its actions in this former "banana
republic," is now an excellent example of harmonious
labor/management relations and the benefits foreign
investment can bring to Honduras when both sides bring a
constructive attitude to the table. Not unique in their
devastation from Hurricane Mitch, Dole and Chiquita both have
invested to rebuild their Honduran operations in contrast to
several Honduran banana companies that did not. If workers
drop their U.S. lawsuit, an out of court settlement of the
pesticide case would then solve the only outstanding labor
issue. End Comment.
Palmer