BNA Daily Labor Report: AFL-CIO, Guatemalan Unions Say Trade Deal Violated

April 24, 2008: In the first complaint of its kind, the AFL-CIO and six Guatemalan labor unions April 23 alleged violations of the U.S.-Dominican Republic-Central America Free Trade Agreement's (CAFTA-DR) labor chapter.

The complaint, filed with the Department of Labor's Office of Trade & Labor Affairs, charged that Guatemala failed to effectively enforce its own labor laws in five separate cases and failed to respect international workers' rights.

"The Department of Labor will thoroughly review and investigate these allegations within the parameters set by the [CAFTA-DR] agreement," Charlotte Ponticelli, deputy undersecretary of labor for international affairs, said in a statement. "Free trade agreements like [CAFTA-DR], provide a mechanism so that the United States government can address allegations of this nature."

The CAFTA-DR, which was effected between the United States and Guatemala on July 1, 2006, contains an "enforce your own laws standard" with respect to labor laws.

Four union leaders and/or their family members have been murdered in Guatemala in 2008 alone, the AFL-CIO charged in a statement. Others have been victims of attempted murder and/or have been subjected to death threats. Firings occur routinely when workers attempt to join or form a union, bargain collectively, or conduct a strike, the AFL-CIO said.

Workers' claims are not accorded serious investigation by Guatemala's Ministry of Labor and punishment for employers who break the law is infrequent, the complaint alleged. No arrests have been made in two murders and numerous threats outlined in the petition, the AFL-CIO said.

Freedom of Association

The complaint calls on the Bush administration to formally initiate dispute settlement proceedings to "require the government of Guatemala to take all measures necessary to assure that trade unionists in Guatemala can exercise their rights to freedom of association without intimidation, threats of violence, illegal dismissals by employers, or targeted assassination," the AFL-CIO said in the statement.

Under Article 16.6, a CAFTA-DR party may request consultations with another party on any matter arising under the labor chapter. If cooperative labor consultations fail to resolve the dispute, the United States should seek further consultations under CAFTA-DR Chapter 20, the complaint said. Chapter 20 is the dispute settlement chapter of the CAFTA-DR.

An AFL-CIO official told BNA that, assuming that the complaint made it through the process and Guatemala was found in violation, it could be assessed a maximum fine of $15 million, which it would pay to itself for the cost of addressing the underlying problems. If it failed to pay the fine, the United States could resort to other measures, including trade sanctions, the official said.

"This is really to send a strong message to Guatemala that they need to clean things up," the official said.

Labor fines are paid into a special escrow account and used for labor initiatives, including enhanced labor law enforcement in the defending country, according to a fact sheet issued by the Office of the U.S. Trade Representative.

The AFL-CIO asked the U.S. government to monitor closely the implementation of all remedies.

Before the CAFTA-DR was ratified in the United States, the Guatemalan government pledged to enhance the administration of labor justice, the AFL-CIO's complaint said. However, such changes were never realized and the United States "has applied little visible pressure" on Guatemala to comply with the CAFTA-DR's labor provisions, the AFL-CIO said.

In the summer of 2005, CAFTA-DR was passed by the House by a two votes, with only 15 Democrats voting in favor of it. Most Democrats objected to the agreement on the grounds that its labor standards were inadequate. The Senate subsequently approved the pact.

The AFL-CIO was one of the staunchest critics of the pact as it was making its way through the U.S. legislative process.

"This petition will demonstrate that ... labor conditions in [Guatemala] have remained unchanged or have worsened since the trade agreement was ratified," the complaint charged. "The level of physical violence against trade unionists increased markedly since the agreement entered into force in July 2006. Violations of freedom of association and collective bargaining continue apace, and access to fair and efficient administrative or judicial tribunals remains elusive."

"Guatemalan workers are being targeted for their union activity," AFL-CIO President John Sweeney said. "Without the freedom from fear to join unions and bargain collectively, how can we expect any workers to benefit from a trade agreement?"

By Rossella Brevetti


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