Complaint

Accuses Mexican Factories of

Labor Abuses, Testing New Trade Pact
The A.F.L.-C.I.O. and other groups are seeking to make use
of a new enforcement mechanism in the updated North
American trade deal.

WASHINGTON — The A.F.L.-C.I.O. and other groups filed a complaint with the Biden
administration on Monday over claims of labor violations at a group of auto parts factories in
Mexico, a move that will pose an early test of the new North American trade deal and its labor
protections.

The complaint focuses on the Tridonex auto parts factories in the city of Matamoros, just across
the border from Brownsville, Texas. The A.F.L.-C.I.O. said workers there have been harassed and
fired over their efforts to organize with an independent union, SNITIS, in place of a company-
controlled union. Susana Prieto Terrazas, a Mexican labor lawyer and SNITIS leader, was arrested
and jailed last year in an episode that received significant attention.

The trade deal, the United States-Mexico-Canada Agreement, was negotiated by the Trump
administration to replace the North American Free Trade Agreement and took effect last summer.
While it was negotiated by a Republican administration, the deal had significant input from
congressional Democrats, who controlled the House and who insisted on tougher labor and
environmental standards in order to vote in favor of the pact, which needed approval from
Congress.

The trade pact required Mexico to make sweeping changes to its labor system, where sham
collective bargaining agreements known as protection contracts, which are imposed without the
involvement of employees and lock in low wages, have been prevalent.

The complaint is being brought under a novel “rapid response” mechanism in the trade deal that
allows for complaints about labor violations to be brought against an individual factory and for
penalties to be applied to that factory. The complaint was filed by the A.F.L.-C.I.O., the Service
Employees International Union, SNITIS and Public Citizen’s Global Trade Watch.

“U.S.M.C.A. requires Mexico to end the reign of protection unions and their corrupt deals with
employers,” Richard L. Trumka, the president of the A.F.L.-C.I.O., said in a statement, using the
abbreviation for the trade deal. “The ongoing harassment of Susana Prieto and SNITIS members
is a textbook violation of the labor laws Mexico has pledged to uphold.”

The trade deal seeks to improve labor conditions and pay for workers in Mexico, which proponents
say would benefit American workers by deterring factory owners from moving their operations to
Mexico from the United States in search of cheaper labor. Enforcement of the pact is one of the
main trade challenges facing the Biden administration.

Tridonex is a subsidiary of Philadelphia-based Cardone Industries, which is controlled by Toronto-

based Brookfield Asset Management, the A.F.L.-C.I.O. said. In 2016, Cardone announced plans
to move its brakes division to Mexico and lay off more than 1,300 workers in Philadelphia,
according to news reports and public records.

The complaint includes several accusations of labor violations, including that workers have not
been able to elect their union leaders or ratify their collective bargaining agreement, and that more
than 600 workers were fired by their employer in acts of retaliation. It also accuses the state of
Tamaulipas of denying the right of workers to choose the union that represents them.

“There couldn’t be a clearer case,” said Mary Kay Henry, the president of the Service Employees
International Union, which represents Cardone workers in Philadelphia.

In a statement, Cardone said it was “committed to leading labor practices, fostering constructive
relationships with employees and fully respecting the universal principle of freedom of association
and the right to collective bargaining.”

“We are committed to fully complying with all applicable labor laws and regulations with respect
to our Tridonex facilities in Matamoros, Mexico,” the statement said. “Should an inquiry be
initiated to further discuss this, we would welcome it and be fully transparent and responsive in
addressing all governmental requests for information.”

The rapid response mechanism in the trade deal allows for the United States to take action against
an individual factory in Mexico if workers there are being denied their rights to free association
and collective bargaining. It was among the provisions that Democrats highlighted as an
improvement in the final agreement compared with the Trump administration’s original version of
the trade deal.

If the United States decides there is sufficient evidence of workers’ rights being denied, it would
then request that Mexico conduct a review of the allegations. After that step, a panel could be
established to investigate the matter. Under the rapid response process, the factory could face
penalties, and repeat offenders could even have their goods blocked from entering the United
States.

Mexico approved an overhaul of its labor laws in 2019, but it is being phased in over several years,
and the implementation of the changes remains a major question mark.

A report released in December by an independent board created by the United States to monitor
the labor changes said that Mexico had made progress but that significant obstacles remained. The
report noted that the protection contract system was still in place, and that most unionized workers
still could not elect their leaders in a democratic manner.
Ben Davis, the director of international affairs for the United Steelworkers and the board’s chair,
said the complaint filed on Monday “has all the elements of the structural problem that we face
with worker rights in Mexico.” The rapid response mechanism, he said, is a way to hold companies
accountable.

“This is the first time that we’ve had anything like this in a trade agreement,” he said, “and so we
think it’s pretty important for it to be used, to be used effectively and hopefully to be something
that we can apply in other places.”

It remains to be seen how the Biden administration will respond to the complaint. An
administration official said the administration would “carefully review” rapid response mechanism
complaints.

The United States trade representative, Katherine Tai, previously served as the chief trade counsel
for the powerful House Ways and Means Committee. In that post, she played a key role in
negotiations between House Democrats and the Trump administration over revisions to the trade
agreement.

Ms. Tai has said that enforcing the agreement is a priority, and the first meeting of the commission
that oversees the pact — consisting of Ms. Tai and her counterparts from Canada and Mexico —
is set to take place next week, according to a spokeswoman for the Mexican Embassy in
Washington.

At a Senate hearing last month, Ms. Tai said there were “a number of concerns that we have with
Mexico’s performance of its commitments under U.S.M.C.A.,” without offering specifics.

“We did our very best to put in the most effective tools for enforcement that we know how,” she
said at another point in the hearing. “And they may not be perfect, but we’re not going to know
how effective they’re going to be if we don’t use them.”