A new World Bank report on Mexico, entitled "An Integral Agenda
of Development for the New Era," was formally presented in Mexico
on May 21. The report includes specific recommendations on labor policy
for the government of President Vicente Fox, most notably proposals
for increasing the "flexibility" of Mexican labor.
Concretely, the report recommends the elimination of current regulations
mandating severance pay, collective bargaining, exclusion contracts,
obligatory benefits, restrictions on contracts for temporary employment
and apprenticeships, antiquity-based promotion schemes, company-sponsored
training programs, and company payments to social security and housing
plans. The report suggested that North American investors attracted
to Mexico under NAFTA are put off by domestic labor regulations, and
that without making salaries more flexible, reducing company obligations
toward workers and essentially repealing the federal labor law, investors
will continue to have doubts about Mexico's economic future, while the
poor will continue to be "impeded" by pro-labor laws from
"obtaining the greatest benefit from their human capital."
While the World Bank recommendations created a good deal of controversy
in the press and among labor groups, they were solidly backed by the
PAN party and the Fox administration. President Fox said that all the
suggestions and recommendations made by the World Bank "are very
much in line with what we have contemplated," and that indeed they
are essential for Mexico to "really enter into a process of sustainable
development." Managerial Coordinating Council (CCE) president Claudio
X. González, however, took a different view. The leader of Mexico's
most influential business organization affirmed that the World Bank
recommendations went "over the top," and that business leaders
in Mexico have no intention of eliminating elements such as severance
pay, collective bargaining contracts, or payment of benefits to workers.
"We are in the process of modernizing our [labor] law," said
González, "but some of these proposals of the World Bank
are not made even to the most developed nations. Why are they then being
recommended for the emerging countries?"
For more information, visit www.mexicosolidarity.org