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Cablegate: Northern Mexico: Labor Unions Compete Among

VZCZCXRO9868
PP RUEHCD RUEHGD RUEHHM RUEHHO RUEHJO RUEHMC RUEHNG RUEHNL RUEHPOD
RUEHRD RUEHRS RUEHTM
DE RUEHME #2285/01 1291150
ZNR UUUUU ZZH
P 091150Z MAY 07
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 6792
RUEHC/DEPT OF LABOR WASHDC
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE
RUEHXI/LABOR COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAHLA/DEPT OF HOMELAND SECURITY
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS SECTION 01 OF 03 MEXICO 002285

SIPDIS

SIPDIS

DEPT FOR DRL/AWH AND ILCRS, WHA/MEX AND PPC, USDOL FOR ILAB

E.O. 12958: N/A
TAGS: ELAB ECON PGOV SOCI PINR MX
SUBJECT: NORTHERN MEXICO: LABOR UNIONS COMPETE AMONG
THEMSELVES


1. SUMMARY: If the northern Mexican states of Nuevo Leon
(which includeS the major industrial city of Monterrey) and
Coahuila are any indication, labor relations in that part of
Mexico are marked by a general sense of cooperation between
the unions and the region,s larger private and public
employers. In recent meetings with the regional leadership of
several national unions, Embassy Mexico City,s Labor
Counselor was repeatedly told of how closely unions work with
employers to amicably resolve labor related issues. The
general peace that prevails in relations between unions and
employers does not appear to exist to the same degree between
the unions themselves. The national unions represented in
northern Mexico compete among themselves to provide their
members with social services. This competition is in part a
move to fill the gap between the level of services provided
by all levels of the Mexican government and what the workers
say they need to improve their quality of life. On another
level, the competition between unions has all the aspects of
a low intensity struggle for political power. At present this
struggle is well, contained but at some point it could impact
general relations between management and labor should the
unions feel the need to obtain increased resources to show
their members which of them is the better provider. END
SUMMARY.


MEETINGS WITH PRIVATE AND PUBLIC SECTOR LABOR UNIONS
--------------------------------------------- -------

2. Embassy Mexico City,s Labor Counselor recently visited
the northern Mexican states of Nuevo Leon and Coahuila to,
among other things, observe the state of labor relations in
that part of Mexico. These two states account for a
substantial portion of Mexico,s industrial production and
are the recipients of large amounts of foreign investment, a
significant majority of which originates in the US. Over the
course of a three-day visit Labor Counselor met with the
regional leadership of several national unions in both the
public and private sectors.

4. During this visit Embassy Labor Counselor met with heads
of two of the country,s larger private sector labor
federations; the Confederation of Mexican workers (CTM) and
the Revolutionary Confederation of Workers and Peasants
(CROC). The CTM is the largest organized labor association
in Mexico, roughly comparable to the AFL-CIO. The CROC is
perhaps Mexico,s third largest labor association and is
particularly strong in the hotel and food service industries.
Labor Counselor also met with representatives of two of the
larger public sector labor unions; the Sole Union of
Electrical Workers of Mexico (SUTERM) and the Railroad
Workers Union of Mexico (STFRM). Technically speaking the
SUTERM is not the sole electrical workers union but it is, by
far, the larger of two such unions in Mexico. Moreover, as
the railroads in Mexico are no longer public, the STFRM is
not really a public sector labor union but it began as one
and still functions as if it had a single national employer.

ALL QUIET ON THE LABOR FRONT
----------------------------

5. All of the above mentioned labor organizations are
officially tied to Mexico,s former ruling political party,
the Institutional Revolutionary Party (PRI). In the past,
these ties to the PRI, previously the official government
party, helped insure that affiliated labor unions received
favorable hearings with the Mexican government which in turn
would intercede on their behalf with both public and private
employers. Perhaps because of the size and vitality of the
private sector in northern Mexico (particularly in the states
of Nuevo Leon and Coahuila) government and party support for
the unions there was not as significant a factor as in other
parts of Mexico. Broadly speaking, it can be said that the
business of northern Mexico is business and this prevailing
attitude among both labor unions and employers has long been
an underlying factor in the general labor peace that exists
in this part of Mexico.

6. Without exception, all of the union leaders with whom
post,s Labor Counselor met unequivocally stated that they
had good and cooperative relations with the region,s

MEXICO 00002285 002 OF 003


employers. The labor leaders often underscored an awareness,
both by them and their union members, on the need to help
employers reach company productivity goals. Moreover, most of
the union leaders praised the regions, employers for their
cooperative attitude with respect to investing in worker
training. There is no question that the union leaders who
met with Embassy Labor Counselor understood that Mexican
businesses had to be prepared to compete globally if they
hoped to survive and grow. Given the broad sense of shared
interests described by these union leaders, it is difficult
to envision a situation in that part of northern Mexico that
might lead to protracted labor unrest.


THE REAL COMPETITON IS BETWEEN THE UNIONS THEMSELVES
--------------------------------------------- -------

7. The quiet labor situation that exists between the unions
and the regions, employers notwithstanding, all is not
sweetness and light on the labor front. Since the regions,
labor unions have effectively ruled out for now any actions
that might create difficulties for employers, they appear to
have turned their competitive energies against each other.
This seems to be particularly true in the case of the CTM and
the CROC where both regional and national trends may be
factors in the competition that exists between these unions.

8. As noted above, in the past, all of the unions with whom
Labor Counselor met were closely tied to the PRI, Mexico,s
former ruling part. When the PRI lost power in 2000, its
ability to provide for its supporters (in terms of money,
political protection and patronage) declined sharply.
Consequently, labor unions (both regionally and nationally)
that previously counted on the party/government for
preferential treatment and support now had to fend for
themselves in a broad range of areas. This prompted some
unions to reassess their relationship with the PRI.
Officially the CTM, CROC, SUTERM and STFRM are all still part
of the PRI however their degree of party commitment varies.

9. The CTM and the Railroad Workers Union (STFRM) are still
committed to the PRI 100 percent. The SUTERM (at least in
northern Mexico) appears much more interested in avoiding
privatization by helping Mexico,s largest electric utility
company increase productivity than in any type of politics.
The real question mark among these unions is the CROC. In
Mexico,s 2006 presidential elections the CROC,s national
union leader openly campaigned not for the PRI,s candidate
but rather for the candidate of the Party of the Democratic
Revolution (PRD). The PRD candidate lost the election but
only by a hair and the PRD emerged from the contest as
Mexico,s main opposition party. Since then the CROC at the
national level has taken a position of greater independence
from the PRI and that sentiment seems to have filtered down
to the unions, offices in northern Mexico.


WHAT THE UNIONS HAVE TO OFFER
-----------------------------

10. For the most part, the unions in Nuevo Leon and Coahuila
are satisfied with the wages and benefits they have gained
for their members and seem generally unwilling to press
employers for more in these areas. Instead they have taken
it upon themselves to improve the quality of life of their
members by offering them more and better social services than
they currently receive from almost any level of the Mexican
government. All of the unions, to varying degrees, now offer
their member and the members, families a range of health;
education, recreational and retirement benefit services.
With the exception of retirement services, most of these
benefits are generally supported by the unions, own funds.

11. All of the union representatives with whom post,s Labor
Counselor met described student scholarship programs that
were almost identical. In other areas, however, the unions
are focusing their effort on differing areas. The CROC is
focusing on youth sports and education; it even claims it is
well on the way to forming its own university. The CTM is
concentrating on sports in general and on a variety of health
care services; it claims to operate the only union-run
substance abuse treatment center in Mexico. SUTERM is
working in the area of family recreation and better
retirement services. The STFRM has devoted all of its

MEXICO 00002285 003 OF 003


resources (not counting its scholarship program) to providing
retirement services benefits to its former members and their
families.


COMMENT: WHAT DOES IT ALL MEAN
------------------------------

12. In talking to labor leaders in northern Mexico, the
competition between the unions has many of the aspects of a
low intensity struggle for political power. The unions claim
that modern labor movements have to be as concerned about
what happens to the workers off the job as about what happens
to them on the job. None of the leaders seemed to feel that
any level of the Mexican government would be able to provide
the type of social services the workers needed to improve
their quality of life so all of them had taken it upon their
organizations to fill the gap. That said, one did not have
to look very deep or listen for very long to see that the
unions all hoped to do well (politically) by doing good. At
present, their competition to provide workers with better
social services and thereby increase their political standing
seems very well contained. However, it is not hard to
foresee a situation where competition among unions will shift
the dynamic away from providing members with expanded social
services and back to the getting increased wages and benefits
from employers.

13. This message was cleared with AmConsul Monterrey.

Visit Mexico City's Classified Web Site at
http://www.state.sgov.gov/p/wha/mexicocity and the North American
Partnership Blog at http://www.intelink.gov/communities/state/nap /
GARZA

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