The United States-Mexico-Canada Agreement (USMCA), which is slated to enter into force in July, establishes a robust monitoring program.
Until now, the United States has not effectively monitored labor provisions in trade agreements.
The USMCA creates an intersecretary committee with dedicated funds that will be responsible for actively monitoring Mexico’s compliance with the labor chapter, including the following activities:
Independent review body
The USMCA establishes an independent review body that will determine whether Mexico is successfully implementing its labor reform and general labor laws based on objective benchmarks.
Negative determinations will lead to dispute resolution actions.
USMCA and resources
The intersecretary committee will receive funds for United States Trade Representative (USTR) and Department of Labor (DOL) staff dedicated to monitoring and enforcement, including multiple labor attachés based in Mexico.
The intersecretary committee should regularly consult with key stakeholders, including the Labor Advisory Committee.
The committee will also coordinate with other key stakeholders, including the International Labor Organization (ILO), the Inter-American Development Bank (IDB), Mexico and Canada.
The monitoring work of the intersecretary committee will be directly related to the compliance actions taken by the USTR, including the establishment of priority sectors and facilities.
In addition, the committee will review requests submitted by external actors.
In December 2019, USTR chief Robert Lighthizer stated that inspections of compliance with USMCA labor regulations will be conducted by panelists, not by labor attachés.
The Administration included in the implementation legislation of the USMCA the establishment of up to five attachés of the Department of Labor to work with its Mexican counterparts, workers and civil society groups in the implementation of the Mexican labor reform, including providing technical assistance and disbursing funds for capacity development and providing assistance to the new Inter-institutional Labor Committee (between agencies of the United States government).
“These personnel will not be ‘labor inspectors’ and will comply with all relevant Mexican laws,” Lighthizer said in a letter to Jesús Seade, Mexican undersecretary for North America.
“As you know, the USMCA’s rapid response mechanism, the first of its kind, specific to an installation, allows an independent panel made up of three Parties, chosen by both Parties, to request on-site verifications in any of our three countries when there are good questions about whether workers at a particular facility are denied key labor rights. But those verifications will be carried out by independent panelists, not by labor attachés,” argued Lighthizer.