MEXICO CITY (Reuters) – The U.S. government is considering filing a complaint under a regional trade agreement over alleged labor violations against an auto parts plant in northern Mexico owned by Netherlands-based Stylantis, two Mexican officials told Reuters. .
If the US Trade Representative resumes the investigation of Teksid Hierro de México, in the border state of Coahuila, this will be the fourth labor complaint against a foreign company in the Latin American country since the North American Trade Agreement, TMEC, came into force.
The agreement, signed by Canada, the United States and Mexico, seeks to improve conditions in Mexican workplaces, among other goals.
The US Trade Representative’s office (USTR) and the US Department of Labor declined to comment.
When asked about a potential labor investigation at the Coahuila plant, Stellantis said he respects collective bargaining rights and will comply with local laws. The conglomerate became the world’s fourth largest car group through the merger of PSA, maker of Peugeot, and Fiat Chrysler last year.
Under the stricter rules of the new trade agreement, which replaced NAFTA, factories that violate workers’ rights can lose their duty-free status. Companies were watching these early cases closely to see how the new rules would play out.
Tekesed, which employs nearly 1,500 people and makes iron foundries for heavy vehicles, has been embroiled since 2014 in a union dispute that labor activists say has prevented workers from representing a group of their choosing.
Employee advocates also say some were fired after supporting the group, known as the National Union of Miners.
US labor authorities told the Mexican government in early May that they were considering opening a complaint in an exodus after unions denounced the case, according to Alejandro Encinas, head of the labor policy and institutional relations unit at the Mexican Ministry of Labor.
“The United States is reviewing the case,” he said.
Encinas did not mention the unions that raised the issue with representatives from the neighboring country.
The official and director of the Federal Center for Conciliation and Employment Registration, Alfredo Dominguez, explained that US authorities have 30 days from the time they receive the application to assess whether to proceed under the TMEC’s rapid response mechanism. .
Previous complaints have also been directed at the auto sector, with investigations into US automaker General Motors, Japanese conglomerate Panasonic and US-owned plant Tridonex.
Stellantis operates seven other plants in Mexico that include assembly, engines and stamping, and last year produced more than 400,000 vehicles in the country. (Reporting by Dina Beth Solomon; Editing by Stephen Eisenhamer and Alistair Bell; Translated by Raul Curtis Fernandez)
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