Political Context and Labor Relations in Mexico

1. Political Context and Labor Relations in Mexico Input to the Conference „Union Coordination in the Automobile Industry – Building Briges“ Mexico City, September 30 - October 3, 2013 Thomas Manz, FES Mexico September 2013 Friedrich-Ebert-Stiftung – Mexico

2. Historical Origins of the Mexican Labor Relations • The Mexican Revolution from 1910-1920 had a formative impact on the labor relations; • A mayor result of the Revolution was the institutionalization of important labor rights: 8-hour work day, freeedom of strike, minimum wage, etc. • A political result of the Revolution was the establishment of an authoritarian welfare state („estado social autoritario“) with a dominant role of the Institutional Revolutionary Party (PRI – Partido Revolucionario Institucional) that ruled Mexico without interruption from 1929 to 2000 • This authoritarian welfare state could combine up to the 1970 economic progress with social improvements („milagro mexicano“); September 2013 Friedrich-Ebert-Stiftung – Mexico

3. Characteristics of the Mexican Labor Relations (1) Key charactristics of the Mexican Labor Relations were shaped in the beginnings of the 20th century, and are valid until today: • the corporative structure: • tight linkages between trade unions and state resp. the dominatn political party (PRI), • involvment of labor organizations in tripartite structures (arbitration panels, administrative boards of social security system, minimum wages committees ,etc.) • the „corporative pact“: a trade-off between social benefits and industrial peace September 2013 Friedrich-Ebert-Stiftung – Mexico

4. Characteristics of the Mexican Labor Relations (2) • An authoritarian and hierarchical organization: • Executive Committees are often appointed by acclamation, not by free and secret ballots • Little personnel renovation („lifetime leaders“) and gerontocracy: Fidel Velazquez was CTM General Secretary from 1941 up to his death in 1997 in the old age of 97; the present CTM General Secretary Joaquin Gamboa Pascoe is 85 years old; • Nepotism and cliquism • Corruption (case of Esther Elba Gordillo) September 2013 Friedrich-Ebert-Stiftung – Mexico

5. Characteristics of the Mexican Labor Relations (3) • A strong state interventionism: • A compulsive registration of labor organization by the authorities, the so-called „toma de nota“ • Interventions in internal processes (elections, etc.) • Control over registers of trade union members and information about collective agreements It was not before 2007 that the Mexican Labor Ministry accepted the rule of the National Transparency Law that declared collective bargaining agreements as public information. • Instaed of independent labor courts: tripartite arbitration panels („Juntas de Conciliación y Arbitraje“) with a dominant position of state representatives September 2013 Friedrich-Ebert-Stiftung – Mexico

6. Characteristics of the Mexican Labor Relations (4) Other major characteristics of the Mexican labor relations are: • The strong fragmentation of the trade unions: • 39 confederations and national organizations • in the private sector: about 2,500 organizations • Mainly company unions and occupational unions • A low rate of unionization: • 4.6 million members (more than 50% in the public sector) • 10% of the labor force September 2013 Friedrich-Ebert-Stiftung – Mexico

7. The Mexican Trade Union System (1) In the fragmented Trade Union System , at least 4 main organizational models can be differentiated: • The corporative or „official“ trade unions • The independent trade unions • The yellow organizations • The „simulative“ trade unions September 2013 Friedrich-Ebert-Stiftung – Mexico

8. The Mexican Trade Union System (2) • The corporative or „official“ trade unions: • with official registration (toma de nota) • close relationship to the PRI • concentrated in the umbrella organization „Congreso del Trabajo“ • little committment to the bargaining work on the shop floor • major organizations: • Confederación de Trabajadores de México (CTM): 750.000 members • Federación de Sindicatos de Trabajadores al Servicio del Estado (FSTSE): 700.000 members • Confederación Revolucionaria de Obreros y Campesinos (CROC): 80.000 • Confederación Regional Obrera Mexicana (CROM): 30.000 • CTM with important representation in the Automotive Industry: • Ford, GM, Chrysler, Nissan Aguasc/EDOMEX, VW Silao, MAN September 2013 Friedrich-Ebert-Stiftung – Mexico

9. The Mexican Trade Union System (3) • The independent trade unions: • without official registration (toma de nota) • no affiliation to the PRI • real bargaining on the shop floor • major organizations: • Unión Nacional de Trabajadores (UNT): 450.000 members • Frente Sindical Mexicano (FSM) • Miners Organization (SNTMMSRM) • minor representation in the Automotive Industry: • VW Puebla, Nissan Cuernavaca, Audi Puebla September 2013 Friedrich-Ebert-Stiftung – Mexico

10. The Mexican Trade Union System (4) • The yellow trade unions: • with official registration (toma de nota) • mainly in the north of the country (Nuevo León) • no affiliation to the PRI, but support by the conservative PAN • subordinated to corporation interests • major organization: • Alianza Sindical Mexicana (ASM): 1 Mio. memebers • minor representation in the Automotive Industry: • Mercedes Benz in Nuevo León September 2013 Friedrich-Ebert-Stiftung – Mexico

11. The Mexican Trade Union System (5) • The „simulative“ trade unions: • personalities in possession of a „toma de nota“ (official concession) • no real representation on the shop floor • negotiate „Protection Contracts“: • Agreements designed for employer protection without approval by the empolyees • major organization: • Federación Sindical Coordinadora Nacional de Trabajadores (FSCNT) • minor representation in the Automotive Industry: • Peugeot September 2013 Friedrich-Ebert-Stiftung – Mexico

12. The Mexican Bargaining Culture (1) • Collective bargaining mainly take place on the plant level • Very little experience with sector agreements • Underdeveloped coordination and cooperation among trade unions with regard to bargaining processes: • recently: creation of the Conferencia Nacional de Sindicatos de Trabajadores del Sector Automotriz (CONSTA) – an informal coordination committee • Entitled to bargain collective agreements is the labor organization with the strongest representation in the plant September 2013 Friedrich-Ebert-Stiftung – Mexico

13. The Mexican Bargaining Culture (2) • Strong prevalence of „Protection Contracts“: • Estimates talk about 80% of all bargaining agreements in Mexico • negotiated by „simulative“ organizations without real presence on the shop floor • stipulate mainly rules and benefits yet granted by law • agreed without knowledge of the workers • International Campain against „Protection Contracts“ September 2013 Friedrich-Ebert-Stiftung – Mexico

14. The current political situation (1) • Return of the Institutional Revolucionary Party (PRI) into power: • The PRI won the 2012-elections with its presidential candidate Enrique Peña Nieto who came into office in December 2012 • The new government renewed its traditional relations with the corporative trade unions (above all CTM, FSTSE, CROC) • and consolidated its influence and control on the labor movement: see the recapture of the teacher union SNTE . September 2013 Friedrich-Ebert-Stiftung – Mexico

15. The current political situation (2) • Adoption of a Labor Legislation Reform in December 2012: • Flexibilization of some norms regarding individual rights and working conditions • no revision of the registration procedures for trade unions (toma de nota) • no reform of the labor jurisdiction • no enhancing of transparency and democracy obligations for trade unions • no regulation to prevent „Protection Contracts" September 2013 Friedrich-Ebert-Stiftung – Mexico