The Office of the U.S. Trade Representative announced Feb. 5 the successful resolution of the eighth facility-specific petition under the United States-Mexico-Canada Agreement Rapid Response Labor Mechanism, which involved a tire manufacturing facility in the city and state of San Luis Potosí.

USTR notes that in July 2023 the U.S. and Mexico agreed on a robust plan to address labor violations at the facility related to the manufacturer’s failure to apply the sector-wide agreement for the rubber manufacturing industry (known as the contrato ley). That plan has now been implemented and the denial of rights concerns raised in the U.S. request for review have been remedied. As a result, USTR has directed the Treasury Department to resume liquidation of unliquidated entries of goods from the facility.

Actions taken by the facility and the Mexican government to address the matter included:

- a free and fair vote at the facility that resulted in an independent union representing workers for purposes of bargaining and facilitation of the contrato ley;

- 1,186 workers were paid $4.2 million in back wages and benefits owed under the contrato ley;

- the contrato ley is now being applied at the facility, while retaining any prior wages or benefits that exceeded the terms of the contrato ley;

- management and labor agreed to several individual agreements on working hours and vacation periods, licenses for union representatives, productivity bonuses, salary ranges, and a payment system;

- the parties committed to continuing negotiations for salary increases for the coming year;

- the manufacturer adopted and posted a neutrality statement and company guidelines on freedom of association and collective bargaining, including a zero-tolerance policy for violations, and trained all company personnel on the guidelines and neutrality commitments;

- the manufacturer established a complaint mechanism for workers to anonymously report any violations of their rights and breaches of company guidelines on freedom of association and collective bargaining;

- the Mexican government informed workers about its findings and the course of remediation and delivered in-person trainings for company personnel on freedom of association and collective bargaining;

- the Mexican government monitored the facility, including by conducting periodic inspections, and engaged with the workers and employer throughout the implementation of the course of remediation;

- the Mexican government published and disseminated materials explaining key issues related to the rights of workers to freedom of association and collective bargaining, including the law related to and the existence of contrato ley; and

- Mexican authorities agreed to review other companies in the rubber industry and their respective agreements to guarantee that workers receive any applicable benefits under the federal labor law and the contrato ley.

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