UNIONS AND JALISCO STATE GOVERNMENT SIGN AGREEMENT

UNCLAS SECTION 01 OF 03 MEXICO 005936

SIPDIS

SIPDIS

DEPT FOR DRL/AWH AND ILSCR AND WHA/MEX, USDOL AND ILAB

E.O. 12958: N/A
TAGS: ELAB ECON PGOV PINR PHUM MX
SUBJECT: UNIONS AND JALISCO STATE GOVERNMENT SIGN AGREEMENT
TO IMPROVE LABOR ENVIRONMENT



1. SUMMARY: In late October the local offices of several
national labor confederations and the government of the
western Mexican state of Jalisco signed an agreement aimed at
improving the state,s overall labor environment. The
agreement called for the unions and the state government to
work together to reduce the number of threatened strikes.
Mexico,s constitution guarantees freedom of association and
the right to strike. However, in order to exercise the right
to strike Federal Labor Law establishes various
administrative requirements, the two most important being (1)
only legally established unions can call for a strike and (2)
before a strike can be considered legal a union must receive
approval of a strike notice from the appropriate labor
authorities. The agreement between the unions and state
authorities is Jalisco is a well-intentioned effort to deal
with a situation in which the threat of a strike is
increasingly used, often by bogus unions, to extort money
from businesses. Still, it is doubtful that this state level
agreement will produce significant concrete results. The
roots of this dilemma stems from abuses of Federal Labor Law
and ultimately it will require changes at the federal level
to address the problem of fake or threatened strikes. END
SUMMARY.


STATE LEVEL GOVERNMENT AND UNIONS TAKE ON NATIONAL PROBLEM
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2. On October 31, the government of the western Mexican
state of Jalisco and the local offices of several national
labor confederations signed an accord aimed at improving the
state,s overall labor climate. The accord, called &The
Agreement for Labor Stability8, is an attempt to reduce the
number of threatened strikes, often called by bogus or
unscrupulous unions for reasons that have nothing to do with
defending worker rights. According to statements by both
state government and union officials, Jalisco is facing a
situation in which the threat of a strike, as opposed to an
actual strike, is harming the business climate and
discouraging foreign investment. Spokesmen for the state,s
private sector claim that the threat of a strike is
increasingly being used by labor unions to extort money from
businesses that often willingly pay up in order to avoid any
labor conflicts or disputes that might disrupt their
operations.


3. The agreement was signed on the state government,s side
by Jalisco,s governor Emilio Gonzalez Marques and its
Secretary of Labor, Ernesto Espinosa Guarro. The union

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representatives who signed the agreement included the state
Secretaries General of three national labor confederations.

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Representing Mexico,s largest national labor federation, the
CTM (Confederation of Mexican Workers),was Rafael Yerena
Zambrano. The next most important labor leader to sign was
Antonio Alvarez Esparza of the CROC (Revolutionary
Confederation of Workers and Peasants),Mexico,s third
largest national labor federation. (Comment: The CROC is a
divided union in Jalisco and Alvarez represents the smaller
and weaker portion of the union.) Finally, there was
Crescensio Farias of the COR (Revolutionary Workers
Confederation),one of Mexico,s smallest national level
labor organizations. Both the Jalisco government and the
union officials pledged to take action to reduce the number
of strikes or threatened strikes in the state but this
phenomenon is very much a national problems that may be
resistant to state level action.


THE ROOTS OF THE PROBLEM
--------------


4. Mexico,s constitution guarantees freedom of association
and the right to strike. The statutes that codify these
rights are contained in Mexico,s &Federal Labor Law.8 In
order to exercise the right to strike, Federal Labor Law
establishes various administrative requirements, the two most
important in this case being: (1) that only officially
recognized unions can call for a strike and (2) before a
strike can be considered legal a union must receive approval
of a strike notice from the appropriate labor authorities.
There are no provisions in Mexican law for state level
authorities to suspend these two administrative requirements
although state labor authorities can adapt their

MEXICO 00005936 002 OF 003


implementation in order to conform to local conditions.


5. In Jalisco, as in most other parts of Mexico, the
unintended consequences of the two above-mentioned
administrative requirements are a shockingly large number of
filings for approvals of strike notices. As of the end of
October, Jalisco,s labor authorities had received 15,495
applications for approvals of strike notices. Of this number
only 4,061 were finally approved and, of those filings
approved, only 162 ultimately resulted in an actual strike.


6. Many to the over 15,000 applications for approvals of
strike notices were attributed to unscrupulous or paper
unions which exist because of abuses of the constitutional
guarantee of freedom of association. Under Federal Labor Law
a union can be formed with as few as 20 employees.
Unfortunately, Mexican labor authorities (at both the federal
and state levels) are often lax when it comes to verifying
whether the employees of a particular workplace actually
exist or, if the workers do exist, whether they are aware
that someone filed for legal status as their union
representative. Once a union has been officially recognized,
whether or not there really are any workers in the union, the
documents establishing the union can be used to file an
application for approval of a strike notice. Approved strike
notices are then presented to business owners who are
extorted to make the problem go away. The business owner
could refuse to pay and risk a strike but the cost of handing
over the pay-off is usually less than the cost of challenging
the legal status of one of these paper unions and/or the
legality of a strike.


THE DETAILS OF THE AGREEMENT
--------------


7. In order to address the growing problem of paper labor
unions using the threat of a strike to extort money from
businesses the Jalisco agreement commits the state government
and the unions to:

Working together jointly to reduce the number of strikes
statewide;

Verify the legal status (at least on paper) of any union
filing an application for approval of a strike notice;

Deny any application for approval of a strike notice that is
not signed by the union,s Secretary General;

Verify the signature of the union Secretary General on any
application for approval of a strike notice.


NOT ALL UNIONS APPROVE OF THE AGREEMENT
--------------


8. The unions which signed the agreement with the government
of Jalisco represent some 60 percent of all unionized workers
in the state. The other 40 percent of Jalisco,s unionized
workers are represented by the FROC (Federation of
Revolutionary Workers and Compassions) and the CROM
(Revolutionary Confederation of Mexican Workers). The FROC
is the larger and stronger portion of the CROC in Jalisco and
the CROM there is affiliated with Mexico,s fourth largest
labor federation.


9. The two labor organizations who pointedly refused to sign
the agreement with the government of Jalisco claimed they did
so in order to protect the worker rights. In their view, the
agreement both attempts to supercede the administrative
provisions of Federal Labor Law and to deny workers their
constitutionally guaranteed right to strike. Moreover,
spokespersons for these two unions opined, the recently
signed agreement was no different from a similar accord
reached several years ago by the previous state government
administration. That accord, the spokespersons averred,
provided excellent photo opportunities but produced little in
the way of concrete results.

COMMENT
--------------



MEXICO 00005936 003 OF 003



10. Despite their obvious good intentions of the union
leaders and state government of Jalisco it is unlikely that
&The Agreement for Labor Stability8 will produce any
significant results. At both the state and federal levels
Mexico,s labor authorities have been reluctant to weed out
bogus paper unions or actively restrain real but unscrupulous
unions. There is a chance that those in Jalisco seeking to
abuse rights of free association and the right to strike
codified in Mexican Federal Labor Law make restrain
themselves now that they will be subject to closer scrutiny.
However, without a change in federal law the moment the
authorities let down their guard there will be no legal
impediment to those bogus paper unions or unscrupulous unions
going back to their old tricks.



11. This message was cleared with AmConsul Guadalajara.






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