Proposal for Strengthening Trade Unions' Effective

UNCLAS TEGUCIGALPA 000430

SIPDIS

SIPDIS

STATE FOR WHA/PPC PUCCETTI AND DRL/IL DEL VECCHIO
STATE FOR WHA/CEN AND WHA/EPSC
STATE PASS USAID FOR LAC/RSD: BARRY MACDONALD
DEPT. OF LABOR FOR ILAB: JANE RICHARDS



E.O. 12958: N/A
TAGS: ELAB ETRD EAID ECON PGOV HO
SUBJECT: Proposal for Strengthening Trade Unions' Effective
Role with CAFTA and Improving the Culture of Labor Law
Compliance in Honduras

Reftel: SECSTATE 26123


1. Summary: As per the referenced cable, Congress
appropriated $40 million ($20 million in ESF and $20 million
in DA) in FY 2006 for trade capacity building in CAFTA-DR
countries to be used in the areas of labor and the
environment. This proposal is the first of three
USAID/Honduras responses to the request for input and ideas
for projects that meet the labor and environment trade
capacity building priorities for Honduras. End Summary.


2. Justification: Trade unions are organizationally weak and
politically influenced. These organizations have not
evolved where they fully represent the interests of their
members and nurture leadership from their local labor units.
Instead, labor unions are often manipulated by political
interests, and they are often unable to sit down at
negotiations and have fruitful discussions. Their strikes
are often non-constructive and frequently ineffective, and
can be counterproductive to economic development and foreign
investment. Many workers remain unaware of their rights and
do not file complaints to labor law infringements.
Consequently, workers are placed at a disadvantage by their
lack of representation and information.


3. Description: This program will address the need to
strengthen democratic processes within the unions and
improve their organizational capacity, particularly at the
local level, to seek out younger potential leaders and to
train them in more representative, democratic practices.
Strengthening trade unions' capacity to organize, negotiate,
and democratically represent their members is an important
element of trade capacity building strategies. This is
required to improve the ability of local labor units to
participate more effectively in the direction of their
unions.


4. Local labor units will improve the awareness of their
local unit members with labor laws and regulations as well
as strengthen their leadership in strategizing and resolving
issues. It will focus on encouraging trade union
participation in economic policy-making and legislating, but
most importantly, on developing strong leadership and
organizational potentials at the local level. Through their
labor unions, workers will be made aware of labor laws and
regulations, but most importantly, of their obligations and
responsibilities. Labor unions also need to provide
mechanisms that give access and safe haven for workers to
file legitimate claims. Having the institutional capacity
to expedite the process of adjudicating claims will be
meaningless if workers lack the knowledge and viable means
to file claims. Best practices by local labor units from
other countries will also be shared to encourage innovation
by Honduran labor participants.

Quick results will be achieved in the first year with
improving the awareness of workers as well as making
negotiations more constructive. Multiyear funding will be
required to achieve sustainable changes with introducing
democratic processes with local labor units that nurture
leadership and create more participatory processes in the
direction and decision-making of trade unions.


5. Advancing U.S. Policy Objectives: CAFTA implementation
will be strengthened by professional, democratic trade
unions that support equitable economic growth by
participating as an effective partner in mature,
constructive industrial relations. Augmenting the capacity
of labor unions to participate more effectively in economic
policy-making and business relations will make them more
constructive partners rather than being manipulated by
political interests seeking to counter CAFTA. Additionally,
labor unions will need to play critical roles in handling
violations and institutional weaknesses that will threaten
Honduras' compliance with labor provisions in their trade
agreements.


6. New or Related to Previous Work: This program will
complement labor activities being implemented through the
Department of Labor's Cumple y Gana project, the Continuous
Improvement in the Central American Workplace (CIMCAW),the
International Labor Organization, the Solidarity Center, and
other regional programs. While other activities have
focused on increasing workers' and managers' understanding
of rights and responsibilities, efforts have not focused



sufficiently on bringing in labor unions as effective
partners, particularly due to the unions' weak capacity and
low internal resources. Social dialogue efforts have had
limited impact since Honduran authorities continue to
demonstrate ineffectiveness in protecting worker rights in
the application of the labor law. Weak leadership skills
and democratic practices further debilitate the labor unions
to play a critical role in strengthening the transparency
and viability of processes, such as filing complaints, so
that workers have knowledge, access, and freedom from
reprisals. Efforts also have not addressed weaknesses in
local labor units which are essential to building more
participatory processes as well as leadership within union
structures; this is necessary to change traditional
organizational practices that promote political patronage
rather than democratic representation, leaving workers
without the instruments that protect their interests when
political will is absent. Additionally, regional activities
have focused primarily on regional training, and in some
cases, the provision of limited information technology.


7. Estimated Cost: $2,250,000 (three-year program period)


8. Local Buy-In: Labor union representatives have been
receptive to assistance and training to their membership,
and representatives of employer's organizations have
expressed the need for more efficient counterparts in labor-
management negotiations. Objectives under this proposal
follow interests established in the White Paper.


9. Public Diplomacy Strategies: Training to local labor
units on national labor laws as well as their rights and
responsibilities will help promote international labor
standards and the national rule of law as it applies to
labor. Improved dissemination and understanding of issues
concerning compliance with labor and other provisions in
trade agreements will also help counter propaganda and
misinformation.

Ford