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Mexican President Outlines Efforts to Implement Labor Reforms

Monday, October 21, 2019
Sandler, Travis & Rosenberg Trade Report

House Ways and Means Committee Chairman Richard Neal (D-MA) received a letter Oct. 17 from Mexican President Andrés Manuel López Obrador that lays out the steps Mexico is taking to implement a number of labor reforms as part of efforts to pave the way for the implementation of the United States-Mexico-Canada Agreement.

According to the letter, López Obrador has instructed Secretary of Finance and Public Credit Arturo Herrera to ask the Chamber of Deputies and the local legislatures to increase the initial amount budgeted to implement the labor reforms approved last May to ensure it is sufficient. The Mexican government will also pursue a three-stage timetable for transitioning to a new labor justice system, with the first stage beginning Oct. 1, 2020 with respect to 10 states, the second stage beginning Oct. 1, 2021 with respect to 11 more states, and the last stage beginning May 1, 2022 with respect to the remaining 11 states.

López Obrador has also instructed the relevant authorities to “engage in a frontal attack on impunity in labor issues, especially those related to the freedoms of labor unions”, and highlighted recent increases in the minimum wage as well as plans to continue increasing wages by at least two percentage points above the inflation rate each year.

Lastly, López Obrador indicated that he shares the concerns expressed by Democratic lawmakers regarding USMCA ratification and stressed that Mexico has “no reservations regarding the implementation of mechanisms that will ensure compliance with the provisions” outlined in his letter.

Chairman Neal welcomed López Obrador’s assurances as well as the details provided regarding Mexico’s plans and strategy for implementation of its labor reforms, and added that he is “eager to receive further details from USTR regarding the Trump Administration’s preparation to meet our priorities.”

For more information on the USMCA, please contact trade consultant Nicole Bivens Collinson at (202) 730-4956.

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