Mexico and the US resolve labor dispute via T-MEC over auto parts plant

The governments of the United States and Mexico resolved a dispute under the USMCA trade agreement that alleged labor rights abuses at the auto parts plant Teksid Iron from Mexicoowned by Stellantis.

According to the resolution, Teksid agreed to recognize an independent union and rehire 36 workers who were laid off.

The Office of the United States Trade Representative (USTR) said in a statement that employees at the plant were previously denied their rights to choose their union and bargain collectively.

The facility, which produces auto parts for heavy vehicles, employs about 1,500 workers.

The case reached a resolution without resorting to an arbitration panel or the imposition of trade sanctions, the Mexican Labor and Economy Secretariats said in a statement.

Teksid said he “cooperated diligently” with US and Mexican officials during the process.

The Secretary of the Economy, Tatiana Clouthier and the Trade Representative of the United States, Katherine Tai

The Ministry of Labor and Social Welfare highlighted the following in a statement:

In a responsible manner and committed to the rights of workers, Mexico has once again managed to guarantee, in the short term, compliance with the labor obligations contained in the T-MEC (…) thus ensuring the rights of free association and effective collective bargaining.

The federal government recognized the union and the company that reached an agreement on July 11in accordance with Mexican labor law.

The result achieved allows guaranteeing the protection of the rights of workers to decide which union best represents their interests; Teksid’s recognition of the union holding the only valid collective bargaining agreement before the registration authority -the Federal Center for Conciliation and Labor Registration-.

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The Mexican government has duly addressed all requests for review (…) which has avoided resorting to an arbitration panel and the imposition of trade sanctions.

Mexico facilitated constructive discussions: US

The Office of the United States Trade Representative also announced the successful agreement.

The Joe Biden administration acknowledged that Mexico conducted a review in response to the request and facilitated constructive discussions between the company and the union independently to remedy the situation.

The United States Trade Representative, Katherine Tai, said:

This resolution is yet another example of the Biden-Harris administration’s commitment to defending workers’ rights.

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