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Mexico: Wages in auto sector have stagnated because of contracts that give workers no input on pay, says Bloomberg

Author: David Welch & Nacha Cattan, Bloomberg, Published on: 8 May 2017

 “How Mexico’s unions sell out autoworkers”, 5 May 17

…So-called protection contracts— agreements negotiated between a company and a union that doesn’t legitimately represent workers—are illegal in the U.S. and Germany. But…a senior lecturer at Cornell’s School…says they’re standard operating procedure in Mexico…Mexican assembly-line workers earn about one-tenth of what their U.S. counterparts make…That established a pattern that continues in which a company signs a contract with a union of its choosing as soon as it announces a new project…[A]n IG Metall board member, says…“Unions in Mexico and the CTM, too, often have mafia-like structures and many are directly linked to the Mexican ruling party. In those unions, workers don’t get a say in their wage deals and don’t get asked to participate either.” …BMW spokesman Jochen Frey says…the automaker “strives to pay wages that are in the top third level of what’s typical for an area,” and that Mexico is no exception…The International Labour Organization, a United Nations agency that monitors labor rights worldwide, called on the Mexican government in 2012 to address the issue of protection contracts…The bottom line: Wages in Mexico’s auto sector have stagnated because of contracts that give workers no input on pay. [Refers to BMW, Hirschmann Automotive GmbH, Ford]…

Read the full post here

Related companies: BMW Ford