Dive Brief:
- A U.S. auto parts manufacturer with operations in Mexico is again under scrutiny by the Department of Labor for allegations the company is violating workers' rights at its Piedras Negras facility.
- The department requested the government of Mexico conduct a review of VU Manufacturing’s facility to investigate claims the company is denying workers the right to collectively bargain, according to a Jan. 30 press release.
- This is the second complaint made in months to the Interagency Labor Committee for Monitoring and Enforcement about labor practices at the Michigan-based manufacturer’s site. The enforcement committee was formed in 2020 between the Department of Labor and U.S. Trade Representative to monitor labor practices in Canada and Mexico as part of a regional trade agreement.
Dive Insight:
The Mexican government first investigated labor practices at VU Manufacturing in September 2022, supervising a union election at the facility after complaints that workers were being denied collective bargaining rights. The issue was considered resolved at the time, according to a Sept. 14 press release.
A second complaint was filed on Dec. 29, however, alleging that the maker of interior car parts such as armrests and seat covers has continued to discriminate against the independent union.
The claims are investigated as part of the labor department’s Rapid Response Labor Mechanism, which allows the U.S. to enforce collective bargaining rights at individual factories in Mexico and resolve disputes in which a U.S. company fails to meet domestic labor laws.
“A core tenet of the Biden administration’s worker-centered trade policy is ensuring workers’ right to organize and collectively bargain without fear of retribution or intimidation,” U.S. Trade Representative Katherine Tai said in a statement. “Despite this facility taking positive actions in 2022, some of the failures we identified previously appear to be recurring.”
Tai previously took action against the manufacturer in July, ordering the Treasury Department to suspend the final settlement of customs accounts related to entries of goods from the VU facility. The incidents illustrate the U.S.’s attempts to enforce compliance at U.S. manufacturers operating in Mexico, particularly as more companies set up shop in the country.
The government of Mexico has until Feb. 9 to respond whether or not to accept the case for review, said Labor Department Public Affairs Christine Feroli in an email. If Mexico's government does accept the case, they must report the findings to U.S. Trade Representative.
VU Manufacturing is not the only auto sector manufacturer to be investigated by the Interagency Labor Committee. In May 2022, the U.S. requested Mexico review labor practices at a Panasonic facility, and in May it requested a review of practices at a GM facility.
Editor’s note: This story has been updated to include additional information from the Department of Labor.
