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Fact Sheet: Guatemala Agrees to Comprehensive Labor Enforcement Plan

04/11/2013

FACT SHEET: GUATEMALA AGREES TO COMPREHENSIVE LABOR ENFORCEMENT PLAN

The United States and Guatemala have agreed to an ambitious and comprehensive enforcement plan that includes significant, concrete actions that the Guatemalan government will implement within specified time frames to improve enforcement of labor laws. Below are some of the key actions contained in the plan.

STRENGTHENING THE MINISTRY OF LABOR TO ENFORCE LABOR LAWS

Sanctioning Employers and Ordering Remediation: Guatemala will pursue legislation to establish an expedited process for labor courts to adopt fines recommended by the Ministry of Labor and Social Protection for labor law violations, and to order employers to remediate such violations. The legislation, when enacted, will reduce the time allowed for the Labor Ministry to transfer cases to the courts from six months to five days, and will require the courts to adopt and impose the Labor Ministry’s fine recommendation, unless unreasonable.

Additional Resources for Inspections: Guatemala, on an ongoing basis, will provide the resources necessary for the Labor Ministry’s effective enforcement of labor laws. In 2012, the Government of Guatemala provided additional resources to the Labor Ministry, including hiring 100 new inspectors and five additional attorneys, and acquiring 20 new vehicles for labor inspectors to conduct inspections throughout Guatemala.

Ensuring Access to Worksites for Labor Inspectors: Guatemala will issue an agreement between the Ministry of Labor and the Ministry of Interior ensuring police assistance to facilitate labor inspector access to worksites.

ENSURING PAYMENT TO WORKERS WHEN FACTORIES SUDDENLY CLOSE

Early Warning System: Guatemala will provide relevant agencies with direct access to each other’s databases so that they may immediately share new information related to a company’s operating status or indicators of impending company closure.

Rapid Response Team to Prevent Factory Closures: Guatemala has established a Rapid Response Team comprised of the Ministry of Economy, Ministry of Interior, the Tax Authority, the Social Security Institute, and the Judiciary to oversee export companies that receive special tax benefits. The Rapid Response Team will verify the imminent closure of a company and work with the employer to attempt to prevent closure and ensure payments owed to workers if the closure cannot be prevented.

Ensuring Workers Get Paid: Guatemala will issue a Ministerial Accord requiring the Labor Ministry to proactively intervene upon receiving information or indicators of a potential closure and take the necessary steps to obtain the payments owed to workers if that company closes, including by petitioning the relevant labor court to embargo or seize assets. This applies to all sectors.

IMPROVING ENFORCEMENT OF COURT ORDERS

Verifying Employer Compliance: Through the newly created “Verification Unit” within the Judiciary, Guatemala will verify timely compliance by employers with labor court orders. The Verification Unit will place particular emphasis on court orders to reinstate illegally fired workers.

Ensuring Criminal Prosecution for Employers who Fail to Comply: Guatemala will train labor court judges and other court personnel and develop the legal procedures necessary to help ensure effective criminal prosecution of employers who fail to comply with labor court orders related to the protection of workers’ rights of association, right to organize, and right to bargain collectively. 

Monitoring Enforcement of Labor Court Orders: Guatemala will conduct a systematic review of all labor courts and will apply disciplinary procedures to judges who fail to take measures required by law to enforce court orders.

ENSURING EXPORT COMPANIES COMPLY WITH LABOR LAWS

Monitoring Export Companies: The Labor Ministry will conduct annual inspections of all companies that receive tax and tariff benefits under special provisions of Guatemalan law (Decree 29-89) to confirm compliance with labor laws and reject new applications for benefits received from labor law violators.

Revoking Tax Benefits: Guatemala will issue a Government Accord requiring that the Ministry of Economy revoke tax and tariff benefits within five days of receiving notice from a labor court that an employer violated a labor law and failed to comply with the labor court’s resolution.

Ensuring Worker Payments: With the help of an international institution, Guatemala will work to develop a contingency mechanism based on the extent of potential need to ensure payments owed to workers when Decree 29-89 companies close.

TRANSPARENCY AND COORDINATION

Stakeholder Input: Guatemala will publicize the Enforcement Plan and meet with the Tripartite Commission and other parties, as appropriate, to review its implementation.

Publication of Enforcement Statistics: Guatemala will publish data concerning labor complaints, inspections, violations, and court orders.