USMCA Rapid Response Labor Mechanism Panel Releases Determination Regarding Grupo México Mine; Biden-Harris Administration Will Continue Seeking to Enforce USMCA Labor Obligations and Advance Workers’ Rights

May 13, 2024

WASHINGTON ­– United States Trade Representative Katherine Tai today issued the following statement after a Rapid Response Labor Mechanism (RRM) panel established under the United States-Mexico-Canada Agreement (USMCA) found against the United States in a determination regarding a labor dispute between Grupo México and Los Mineros at the San Martin mine in the Mexican state of Zacatecas:

“To date, the Rapid Response Mechanism has directly benefited almost 30,000 workers and provided over $5 million in backpay and benefits,” said Ambassador Katherine Tai. “The RRM was incorporated in the USMCA as part of the renegotiation of the North American Free Trade Agreement in order to stop the type of corporate infringement at issue in this case.  The panel’s decision here, which effectively allows Grupo México to continue to violate the San Martin miners’ rights to collective bargaining and freedom of association, is both surprising and disappointing. Nevertheless, we remain confident in the RRM’s promise to defend workers’ rights. The Biden-Harris Administration remains steadfastly committed to using all the tools available under the USMCA to seek redress for the persistent problems in San Martin, and to continue to deliver real, tangible benefits for workers both at home and abroad.”

“Although the panel decision in San Martin did not deliver justice for the San Martin workers, we remain firm in our commitment to use the Rapid Response Labor Mechanism to protect freedom of association and collective bargaining rights in Mexico,” said U.S. Department of Labor’s Deputy Undersecretary for International Affairs Thea Lee.  “We will continue to engage with the government of Mexico on these matters, and we are committed to ensuring that San Martin workers’ rights are protected under the law.” 
The United States Trade Representative and the Secretary of Labor co-chair the Interagency Labor Committee for Monitoring and Enforcement (ILC).  On May 15, 2023, the ILC received an RRM petition from the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), the United Steel Workers (USW), and the Sindicato Nacional de Trabajadores Mineros, Metalúrgicos, Siderúgicos y Similares de la República Mexicana (Los Mineros), a Mexican union.  The ILC, in response to the petition, determined that there was sufficient, credible evidence of a denial of rights enabling the good faith invocation of enforcement mechanisms.  As a result, the U.S. Trade Representative submitted a request to the Governement of Mexico that Mexico review whether workers at the San Martin mine facility were being denied the right to freedom of association and collective bargaining, because Grupo México resumed operations at the San Martin mine regardless an ongoing strike and engaged in collective bargaining with a coalition of workers despite the fact that Los Mineros holds the right to represent workers for purposes of collective bargaining. 

At the conclusion of its 45-day review period, Mexico disagreed with the United States and found no denial of rights to exist.  The United States disagreed with this determination and, on August 22, 2023, requested the establishment of this RRM panel to verify the facility’s compliance with Mexican labor laws and determine whether workers at the San Martin mine were being denied the rights to freedom of association and collective bargaining.  After receiving written submissions from the disputing parties, the panel conducted a verification on February 26 and 27, 2024, and held a hearing in Mexico City on February 28 and 29, 2024.  The RRM panel issued its written determination, and on May 13, 2024, the Parties made the determination public.

The panel found the mine is a covered facility for the purposes of the RRM.  However, the panel went on to find that the alleged denials of rights were not brought under Mexican labor laws necessary to fulfill Mexico’s labor-related obligations within the meaning of the USMCA, because, as a matter of Mexican law, the events at issue would likely be subject to labor laws that predate Mexico’s labor reform.  Therefore, the panel found that it lacked jurisdiction to determine whether a denial of rights occurred at the facility.  The panel acknowledged that the complex factual and legal history underlying this dispute was “highly unusual and unlikely to repeat itself.” One panelist wrote a non-dissenting “separate view” to articulate additional facts verified by the panel regarding the background of the dispute.  The panelist recounted evidence showing what appeared to be illegal collective bargaining between the employer and a union that was not the legal representative of the San Martin mine workers.  The panelist registered concern regarding the negative implications of this activity for the workers’ freedom of association and collective bargaining rights.  

The determination of the panel is final.  In connection with the initial U.S. request for review, Ambassador Tai directed the U.S. Secretary of the Treasury to suspend the final settlement of customs accounts related to entries of goods from the San Martin facility.  Ambassador Tai’s letter directing the U.S. Secretary of the Treasury to resume liquidation of entries of goods from the San Martin facility is available here.

A copy of the panel determination is available here.