United States Announces Successful Resolution of Rapid Response Labor Mechanism Matter at Tecnología Modificada S.A. de C.V. Caterpillar Facility

December 22, 2023

WASHINGTON – The United States today announced the successful resolution of another USMCA Rapid Response Labor Mechanism (RRM) matter regarding the situation at Tecnología Modificada, a Caterpillar, Inc. subsidiary in Nuevo Laredo, that produces remanufactured auto parts.  After the United States requested Mexico’s review of the matter, Mexico and the company took several actions to address the denials of rights the United States found, including actions to reinstate dismissed workers and correct other employer interference in union activities.

“Workers’ ability to exercise their unimpeachable rights to unionize is a key indicator of the success of our trading relationships, and the RRM is an important tool in making trade successful for workers in both of our countries,” said Ambassador Katherine Tai. “Through the RRM, we have worked with the Government of Mexico to advance workers’ rights at the Tecnología Modificada facility.  We will continue to monitor the facility, including employer practices related to the ongoing labor strike and collective bargaining process, to ensure that those rights are fully respected.”

“While we recognize that the workers at Tecnología Modificada remain on strike, we are hopeful that the concrete remediation measures the Government of Mexico facilitated with the employer have laid the foundation for the resumption and successful resolution of a good faith bargaining process,” said Deputy Undersecretary for International Affairs Thea Lee. “We are pleased to have seen the development of company policies on union rights, management training, and offers of reinstatement and full backpay. We look forward to continued partnership with the Government of Mexico.”

Actions taken by the facility and the Government of Mexico to address the matter include:

  • The company offered reinstatement to two unlawfully dismissed workers under the same terms, conditions, and circumstances from before their termination, including full backpay and benefits from the date of termination until the start of the strike;
  • The company issued and distributed a written neutrality statement in which it commits to respect freedom of association and collective bargaining rights;
  • The company issued guidelines that govern conduct of personnel, in which it commits to comply with the neutrality statement and the rights granted to workers, union representatives, and union advisors within the facility;
  • The company implemented a zero-tolerance policy for violations of the neutrality statement and guidelines, including a commitment to sanction any action or omission by its personnel that violates their principle;
  • The Government of Mexico and the company trained all employees who are currently working on freedom of association and collective bargaining rights and responsibilities.  Because the facility is currently on strike, and most workers are not currently working, the company and Mexico committed to provide additional training for striking workers when they return to work.

The United States Trade Representative and the Secretary of Labor co-chair the Interagency Labor Committee for Monitoring and Enforcement (ILC).  On September 25, 2023, the ILC received an RRM petition from Sindicato Nacional Independiente de Trabajadores de Industrias y Servicios “Movimiento 20/32” (SNITIS), a Mexican union.  The petition alleged that the Caterpillar facility engaged in interference in union activity including dismissing a worker in retaliation for undertaking union organizing activity.  The ILC reviews RRM petitions that it receives, and the accompanying information, within 30 days.

In response to the petition, the ILC determined that there was sufficient, credible evidence of a denial of rights enabling the good faith invocation of enforcement mechanisms.  As a result, on October 26, 2023, the United States Trade Representative submitted a request to Mexico to review the matter.  Mexico agreed, and on December 8, 2023, concluded that the denials of rights had been remediated, based on the actions described above.

A copy of the request for review can be found here.

A copy of the letter to the Secretary of the Treasury can be found here.

Information about previous requests can be found here.