¿Qué podemos hacer?: U.S. Employers with Mexican Operations Want to Know

Vinson & Elkins LLP

Vinson & Elkins LLP

After my previous blog post regarding recent labor enforcement actions taken under the U.S.-Mexico-Canada Agreement (“USMCA”) impacting U.S. companies with facilities or subsidiaries in Mexico, I received questions regarding employer rights under Mexican labor law.

Specifically, what rights a Mexican company has in the midst of all this new enforcement activity. In the void of a union contract at the General Motors (“GM”) Mexican facility, for example, can GM — as it could generally under U.S. labor law — direct non-coercive and non-threatening communications to its employees regarding why a union is unnecessary, or tell employees how they will be unable to deal directly with their employer in a unionized setting?

Unfortunately, the answer is unclear under the relatively new Mexican labor law.

If we judge by the two enforcement actions referenced in my previous post, we see employers being asked to play a support role as the bargaining process is undertaken under government supervision, although, of course, this is after a complaint has been made:

  1. In May 2021, the first U.S. petition under the USMCA’s “Rapid Response Mechanism” asked Mexico to investigate a union vote at General Motors’ Silao, Mexico facility. The vote had been suspended over allegations of vote tampering. Ultimately, in July 2021, the U.S. and Mexico entered into a comprehensive remediation plan to address labor practices, requiring a new legitimization vote at the plant. The remediation plan mandated cooperation from General Motors de México, General Motors Company, and certain of its affiliates.
  1. Next, in August 2021, Tridonex, the Mexico-based subsidiary of Cardone Industries — an American company with operations in Matamoros — entered into an action plan and agreed to pay damages, including backpay, to Mexican workers. The action plan was the result of a petition filed by the AFL-CIO and other unions alleging harassment and retaliation against collective bargaining.
  1. Shortly thereafter, as a result of the remediation plan at the General Motors facility, workers conducted a new vote and voted to cancel their collective bargaining contract. The result of the new vote — which was live-blogged by the Mexican government — was fairly close: 2,623 in favor of the existing collective contract, 3,214 against, and 39 null.

On the other hand, we know relatively little about permitted employer actions in the absence of enforcement activity. The new Mexican Federal Labor Law does not appear to speak to the kinds of communications that an employer can have with its employees prior to a vote for the union. For example, Article 390 Ter., Section (II)(d) provides that employers “no podrá tener intervención alguna durante el procedimiento de consulta,” or, translated, “may not have any intervention during the consultation procedure.” However, the “consultation procedure” is the procedure by which employees vote upon a collective bargaining agreement. Before a union arrives at that point, it will likely have significant interactions with the proposed bargaining unit.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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