The business sector has started the analysis of the operation of the Rapid Response Labor Mechanism (RRLM) a tool that is part of the trade agreement with the United States and Canada, as they consider that, three years after its implementation, it is important to reach a balance, which can be achieved in 2026, when the USMCA is reviewed.
In an interview, Lorenzo Roel, president of the Labor Commission of the Business Coordinating Council (CCE), said that they are currently hearing opinions, experiences relating to the Labor mechanism, they are even “conducting an analysis of what has happened in the different procedures, in the search, and also what the interest of the Mexican government is on balancing the Mechanism.”
It is worth recalling that the USMCA includes the Rapid Response Labor Mechanism for Specific Facilities between the United States and Mexico. This dispute solving mechanism provides for the accelerated application of the workers’ rights of free association and collective bargaining at the facility level.
The first step of the mechanism is that a country submits a request for review to the other country in order to determine whether there is a denial of rights and to attempt to remedy any problem that it finds. In certain situations, the mechanism also provides for panelists to evaluate complaints about conditions at specific facilities and, in the event of non-compliance of key labor obligations, provides for the suspension of USMCA tariff benefits or the application of other penalizations, such as the denial of the entry of goods from companies that are repeat offenders.
As of this date, 30 cases have been filed, 23 of them have already been closed; 6 are active and there is one labor panel in process. Likewise, 15 of these cases relate to auto parts; and the federal entities with the most cases are Guanajuato and Coahuila.
Therefore, Roel explained, we are reviewing the extent that intervention at the start of the process can reach and in which cases said intervention in the preparation of the cases should not take place.
“We have sufficient time to prepare this analysis and to see how we can build a better process, in which the companies that are ultimately affected by this process themselves have information and knowing whether it is possible for them to participate directly, as companies are strictly involved and are brought to be part of the agreement.”
Jorge Sales Boyoli, a lawyer specializing on the subject, explained that it is important that the USMCA agreements be reviewed, particularly because just a review of the documents signed by the three countries is talked about. “In the sixth anniversary of the entry into force of the Treaty, the Commission will meet to review its operation, as well as the recommendations from each one of the parties.”
The foregoing because it may also happen that there is a confirmation, in writing, by each one of the parties, for the term of the USMCA to be extended for another 16 years.
Meanwhile, the D&M Abogados Firm presented an analysis that points out that given that “the United States has promulgated a law for the application of Annex 31-A and for filing their complaints, Mexico should also establish, for its part, regulations of the process for application in our territory, so that investigations are conducted in accordance and compliance with the labor legislation.”
Route for the application of the Rapid Response Labor Mechanism:
– The complainant party will request the respondent to conduct its own investigation on alleged violations of union freedom.
– The respondent will have 10 days for deciding whether it will conduct the investigation.
– If the respondent decides not to conduct the investigation, the complainant party may request an arbitration panel.
– If the respondent determines that there is a denial of rights, it will try to remedy it within a term of 45 days.
– If the respondent does not agree to conduct the investigation, or if the complainant was not in agreement with the remedy of the rights that were denied, the complainant may impose penalties, and the respondent may request the formation of an arbitration panel.
– The panel will have 30 days to determine whether there was a violation after conducting a verification, or 30 days after it is formed if there was no verification.
– Once it is determined that a violation took place, the complainant party may impose penalties that are proportional to the damage that was caused.
