AFL-CIO VISITS OUSTED UNION

C O N F I D E N T I A L SECTION 01 OF 03 MEXICO 000006

SIPDIS

DEPT PASS ILAB CRIPSIN RIGBY

E.O. 12958: DECL: 12/18/2019
TAGS: ECON ELAB PGOV MX
SUBJECT: AFL-CIO VISITS OUSTED UNION

REF: A. MEX 3371

B. MEX 3200

C. MEX 3107

D. MEX 2978

E. MEX 2933

Classified By: AMB CARLOS PASCUAL, REASONS 1.4 (B) AND (D)


1. (C) Summary: On December 1-2, high-ranking members of the
American Federation of Labor-Congress of Industrial
Organizations (AFL-CIO) and the Canadian Labour Congress
(CLC) visited Mexico on a joint fact-finding and solidarity
mission to understand first-hand the situation of the
Sindicato Mexicano de Electricistas (SME). The SME was the
union associated with the state-owned power company Luz y
Fuerza del Centro that President Calderon dissolved by decree
on October 11. The SME and its allies continue to vehemently
protest the dissolution, alleging that the Government of
Mexico acted illegally and unconstitutionally. The delegation
met with SME members, leaders, and lawyers on December 1 and
with the U.S. and Canadian embassies, members of the Chamber
of Deputies, and the Under Secretary for Work of the
Secretariat of Labor and Social Prevision on December 2. The
delegation,s activities also included a welcome dinner with
former SME president Martin Esparza and a visit to SME
headquarters in Nexaca. The sympathetic viers of the visiting
delegation for the SME are widely out of line with Mexican
legal experts, corruption specialists, and public opinion.
End summary.

Meeting the Press
--------------


2. (C) After the meetings with SME members, lawyers, and
supporters, the delegation gave a joint press conference
with the SME on the morning of December 2. Stanley Gacek,
Associate Director of International Affairs of the AFL-CIO,
and Hassan Yussuff, Secretary Treasurer of the CLC, stated
that Mexico has violated both human and labor rights under
its own laws and international obligations as well as the
terms of the North American Agreement Labor Corollary (NAALC)
- also a NAFTA violation. Specifically they claimed that
Mexico acted in an anti-union manner in dissolving the
union and violated workers, individual rights to appeal
the government,s decision in terminating their employment.
Yussuff,s comments were significantly sharper than Gacek,s,
but both stressed that the SME is and has always been a union
that favors dialog and not giving in.

Meeting the Embassies
--------------


3. (C) Representatives of the U.S. and Canadian embassies met
the delegation on December 2 to learn what the delegation had
heard from the SME. The main themes of the meeting were
privatization of the energy sector complicated by what the
delegation characterized as a lack of respect for rule of law
and concern over the inefficacy of NAFTA and the NAALC. U.S.
members of the delegation seemed more interested in genuine
discussion than their Canadian counterparts. In a carefully
worded statement, the delegation discussed the violations of
Mexico,s internal laws as well as Mexico,s legal
obligations
under its international treaties, specifically ILO convention
87, the Inter-American Human Rights Charter, and the labor
side agreement to NAFTA (NAALC). They also reminded the
Embassies of the North American Summit in Guadalajara in
August 2009 in which all three leaders agreed that security,
energy, and sustainable employment are priorities for the
region. They questioned President Calderon,s decision to
eliminate more than 44,000 jobs at this time of year
(approaching the holidays),during an economic downturn, and
so quickly after agreeing that decent work is a crucial part
of a regional stabilization strategy.


4. (C) Delegation members from the U.S. mentioned rule of law
as the pricipal issue several times, both in the context of
the SME case and as a concern over fears of privatization.
They accepted, apparently unconditionally, the SME,s claims
that this is the first step towards privatizing Mexico,s
electricity sector. The energy union representative insisted
that privatization in the U.S. and Canada occurred within
relatively strong legal systems with protection for workers
and respect for contracts. He feared that Mexico would
disregard its contractual obligations and that workers would
suffer the consequences. Another representative believed that
what happened with the SME is a classic case of union-busting
by a hostile government. If the SME does not win its legal
and social battles, it will mean that the Mexican legal
system cannot or will not protect workers. Moreover, the GOM

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will be empowered to systematically eliminate every union it
finds inconvenient.


5. (C) Although in some ways the center of the discussion,
the SME was not mentioned by name very often. The delegation
saw the SME's demise as part of a bigger pattern. When
delegation members did mention the SME, they stressed its
long history of militancy, radicalism, and independence.
(Comment: These labels, especially radical and independent,
have meaning within the Mexican labor movement that needs to
be further defined. The SME became independent when it left
the Institutional Revolutionary Party (PRI) to support the
Democratic Revolutionary Party (PRD) and its candidate,
Andres Manuel Lopez Obrador, in the 2006 presidential
elections. The delegation clarified that it did not consider
the unions for PEMEX or the Federal Electricity Commission,
the two other significant unions in the energy sector,
independent, but did not define its rationale. End comment.)
They also insisted that the SME is a union with a history of
negotiating but not giving in, and that Esparza has always
been willing to talk to the government. They were not
impressed that the GOM has also always been willing to talk
to the SME. They consider the SME's intractability, i.e., the
non-negotiable point is rehiring all workers and reversing
the liquidation decree, a reasonable starting point but
reject the GOM,s position that the decree is irreversible and
the workers cannot be rehired legally under a collective
contract. The legal basis for this position is that the GOM
should not have made decisions that cannot be appealed and
that the situation must return to the status quo ante for
there to be a level negotiating field.

Meeting the Under Secretary for Labor of the Secretary of
-------------- --------------
Labor and Social Prevision
--------------


6. (C) Laboff facilitated a meeting with Under-Secretary
for Labor Alvaro Castro at the Secretariat for Labor and
Social Prevision (STPS). The meeting was chaired by Castro;
Jorge Rodriguez and Daniel Ludlow both contributed
significantly. Castro welcomed the delegates and then
expressed his frustration that Yussuff was unable to be
present because he wanted to personally and specifically
respond to Yussuff,s allegations of illegal actions in the
morning press release. Castro thoroughly explained and
supported the GOM,s belief in the legality and
constitutionality of its actions and responded to the
complaints as he understood them, focusing on the following
legal and rehiring issues.

a. The electrical company Luz y Fuerza del Centro (LFC),
being a decentralized, state-run company formed by
presidential decree can and must be dissolved by presidential
decree. Congress has no role to play in the process; what
Calderon did was neither illegal nor unconstitutional.
b. The GOM had tried to work with LFC over several years
and different administrations to improve service and
productivity and to reduce cost to taxpayers, and LFC had
regularly failed to meet agreed upon objectives. This was not
a surprising coup but rather a logical end to a long struggle
with a non-cooperative partner.
c. The GOM is happy to meet former SME members at a
negotiating table and in fact agreed to do so on December 2.
Five prominent and politically varied men will serve as
mediators and sponsors. The GOM, however, will not retract
the decree terminating LFC.
d. Qualified ex-LFC workers can be rehired to work for the
Comision Federal de Electricidad (CFE),the national monopoly
that has taken over the Mexico City market. They can be
hired as individuals but not collectively because the CFE
already has a functional union. There can only be one union
per company, so the request to rehire workers with a
collective contract is legally impossible to honor.
e. The denial of the toma de nota (official GOM recognition
of union election results) was justified by the allegations
of irregularity brought by members of the SME. Furthermore,
the Federal Council for Reconciliation and Arbitration (JFCA)
determined on December 2 that the complaints brought against
Martin Esparza by the other SME presidential candidate,
Alejandro Munoz Resendiz, were valid. Esparza,s victory was
correctly thrown out by the appropriate body.


7. (C) When Castro concluded, Gacek of the AFL-CIO presented
the delegation,s response. He highlighted the delegation,s
concerns for labor and human rights, and stressed his
interest in the ILO,s response to the SME case. The
delegation believed that Mexico,s handling of this matter was
the inverse of what the ILO requires in established
jurisprudence. In his response, Jorge Rodriguez somewhat

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glossed over Mexico,s obligations under the ILO and the toma
de nota process, but responded to specific legal points in
Gacek,s speech, insisting that the GOM believes it has acted
absolutely in accordance with its own laws and its
international obligations. He stressed the constant dialog
that the GOM maintains with Secretary of Labor Hilda Solis
and with their Canadian counterpart on NAALC issues. He also
responded to assertions that the EU had condemned GOM
actions, saying that it is impermissible that the EU should
publicly opine on Mexican laws. Rodriguez stressed repeatedly
that GOM has complied absolutely with Mexican laws and has
been more generous than the legal requirement in the payment
of severances.


8. (C) Ben Davis, Mexico Representative for the AFL-CIO,s
Solidarity Center, summed up for the delegation by reminding
STPS of the importance of &human reality8 and of the
importance of perceptions. Unions around the world perceive
Mexico,s actions in the SME case and the practice of the toma
de nota as union-busting and anti-labor. Davis argued that
regardless of the legal and juridical outcomes, the GOM has a
responsibility to its people and its neighbors. Secure work
helps keep people happy and at home; expanding decent work
opportunities through strong and legitimate unions will help
stem violence and migration. Daniel Ludlow, Director of the
International Affairs Office of the STPS, reminded the
delegation that, regardless of international organized labor
perceptions, the GOM followed its laws, and that furthermore,
the Mexican public perceives this move as positive.

But No Meeting of the Minds
--------------


9. (C) Comment: This delegation came to Mexico primarily to
show solidarity and support for the SME and Esparza; their
calls for &fair and balanced8 reporting from their
embassies
were dramatically weakened by their own meeting schedule that
failed to include any group that doesn,t support the SME. The
Canadian members of the delegation were much angrier about
the SME case than the U.S. members, a situation likely more
tied to internal Canadian politics than to the details of the
SME case. Already anti-NAFTA, the AFL-CIO and the CLC claimed
that Mexico is not an equal partner in the situation. They
repeated several times that the NAALC was ¬ worth the
paper it,s written on8 and a &waste of time8 in
negotiations
and in maintenance and enforcement. The delegation will pass
a report of its findings to Laboff.


10. (C) Nonetheless, many of the issues the delegation
brought to the table are valid in their own right, especially
rule of law and inconsistencies between Mexican labor
traditions and ILO standards. Unfortunately, the delegation
is supporting the SME uncritically, and that will weaken its
ability to get broad labor rights issues into discussions
with decision makers. End comment.
Visit Mexico City's Classified Web Site at
http://www.state.sgov.gov/p/wha/mexicocity and the North American
Partnership Blog at http://www.intelink.gov/communities/state/nap /
PASCUAL