U.S., Mexican Auto-Parts Maker Reach Deal After Labor Complaint

(Bloomberg) -- The U.S. government and a Mexican auto-parts maker reached an agreement to improve working conditions at its plant following a complaint that spurred the first test of enforcement provisions in a new trade agreement.

Tridonex, a factory near the border with Texas in Matamoros, Tamaulipas, will provide severance and back pay to at least 154 workers who were dismissed and will support employees’ rights to determine union representation without coercion, the U.S. Trade Representative’s office said in a statement Tuesday.

The accord comes three months after the AFL-CIO, the U.S.’s largest union, and three other groups filed a complaint against the company, a unit of closely held Cardone Industries Inc. of Philadelphia. It was the first complaint filed under the rapid-response mechanism of the U.S.-Mexico-Canada Agreement, which went into force a year ago and replaced the North American Free Trade Agreement.

The agreement with Tridonex “shows our determination to leverage the USMCA’s innovative enforcement tools to address long-standing labor issues and support Mexico’s implementation of its recent labor reforms,” U.S. Trade Representative Katherine Tai said in the statement.

Read more: U.S., Mexico Fail to Resolve Dispute on Trade Rules for Cars

The Mexican government has also “agreed to help facilitate workers’ rights training for Tridonex employees, monitor any union representation election at the facility, and investigate any claims of workers’ rights violations reported by employees at the plant,” the USTR said.

U.S. labor unions have long complained that Mexican factories under Nafta denied workers’ rights in an effort to keep down salaries and unfairly undercut the U.S. on cost.

In the Tridonex case, independent trade-union lawyer Susana Prieto Terrazas was jailed last year for a month after working to organize employees at the plant. Prieto was only released after agreeing to internal exile in another Mexican state and a ban on appearing in labor court, the unions said in May.

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