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Remarks by Ambassador Michael Froman on Labor Enforcement Case Against Guatemala

Remarks by Ambassador Michael Froman on Labor Enforcement Case Against Guatemala

September 18, 2014
Washington, D.C.

*As Prepared for Delivery*

“Today, I’m joined by President Trumka of the AFL-CIO, Ranking Member Levin, Representatives Becerra and Price, and Deputy Secretary of Labor Chris Lu to announce that this Administration is once again taking action on behalf of workers, both here and around the world, by proceeding with our labor enforcement case against Guatemala under the Central America Free Trade Agreement.

“As President Obama has made clear, our trade agreements must advance both our interests and our values, they must be monitored closely, and the obligations of our trading partners must be enforced.  Central to that commitment are strong, enforceable labor standards.

“These standards level the playing field for American workers and help ensure that global competition is driven by entrepreneurship and innovation, not by exploitation or injustice. 

“These standards protect the fundamental rights of workers around the world and promote trade and investment that lifts the futures of all, not the fortunes of a few.

“These standards stem from our conviction that sustainable development requires much more than promoting economic growth; it requires protecting human dignity.

“And when these standards are threatened, we don’t simply remind our trading partners of their enforcement obligations and point to the bar they are in danger of missing. We work with them to develop a plan for fixing the problem, for creating a ladder they can climb. We extend a hand during our monitoring efforts, and when justified, we provide additional support if progress is significant but slower than promised.

“But we do not lower the bar. And when all our supporting efforts have been exhausted, we do not hesitate to take action.

“This case is the first-ever labor dispute under any free trade agreement, and we have been working with Guatemala even before we formally established this panel in 2011 to afford Guatemalan workers the rights to which they are entitled under Guatemalan law.

“In April of last year, we finished working together on the ladder that was needed: an 18-point Enforcement Plan with concrete steps to strengthen labor law enforcement. And having agreed on that plan, we suspended this arbitration, as we have on a number of occasions, so that Guatemala would have every opportunity to follow through on their commitments and demonstrate that changes were being made on the ground.  Ultimately, though, the ladder we built together remains Guatemala’s to climb.

“To drive home the importance of following through on these commitments, I met face to face with Guatemalan President Perez Molina here in Washington, D.C. last July.

“And, with his encouragement, I traveled to Guatemala the next week and met with their ministers of labor, economy and foreign affairs. 

“I met with Guatemalan Congressional leaders from across the political spectrum to personally urge them to pass needed labor protections.

“And I met with Guatemalan business groups, labor union representatives, the International Labour Organization, and the United Nations to enlist their help in getting Guatemala to enact the needed changes.

“Many of these conversations were productive, and Guatemala has made some important progress over time. That includes, for example, hiring over one hundred new inspectors and creating a unit to verify employer compliance with court orders.

“But, unfortunately, key commitments under the Enforcement Plan remain outstanding, such as passing legislation that enhances the authority of the Ministry of Labor to impose sanctions when it finds a violation of Guatemala’s labor laws and reduces the time it takes to bring labor law violators to justice. 

“Even despite our close collaboration with Guatemala’s Labor Ministry, the record that Guatemala has presented is insufficient to demonstrate that the changes made have had the desired impact on the ground.  

“But let me make clear that our goal in taking action today remains the same as it has always been: to ensure that Guatemala enforces the labor protections to which its workers are entitled. Litigation is a means toward that goal, not an end in itself.  And it is our hope that today’s action will help encourage those in Guatemala who wish to address these issues to strengthen their efforts.  In fact, we understand that even today, there are some in the Guatemalan government trying to push forward on key outstanding elements, like the sanctions legislation.  We will be supporting those important efforts.

“Both the rewards and the urgency of achieving the goal have never been greater than they are today.

“One reason is that our countries are bound together by a number of economic ties—whether it is textiles, apparel, or agricultural products—and making the most of our shared economic potential depends on ensuring that trade-driven growth is inclusive and broad-based.

“But these are not the only ties that our countries share.

“As President Obama made clear when he met with President Perez Molina in July, our countries also share strong connections of culture, family, and promise.

“And as the President said then, we have a shared responsibility to address the challenge of unaccompanied children risking their lives to travel across borders.

“As part of meeting that challenge, we must address the underlying factors that have stunted economic growth and placed opportunity out of reach for too many Guatemalans.

“We have a collective interest in encouraging Guatemala to create an economic environment that offers that opportunity, that reassures families that their children have a future at home and that they can make a living by staying rather than risk their lives by leaving.  Enforcing labor laws is an essential element for spurring economic growth and fostering communities where citizens can thrive. Adherence to the rule of law, transparent and fair procedures, and publication of data on governmental actions all create a better climate for investment and business.

“We remain hopeful that Guatemala can achieve a resolution that results in concrete improvements for workers on the ground and sends a positive signal to the world that would help attract investment, expand economic activity, and promote inclusive growth.

“And we remain committed to helping Guatemala achieve that outcome and earn the benefits that come with enforcing the law to uphold internationally recognized labor rights. 

“There is too much at stake—the rights of workers, the safety of children, the opportunities of future generations—to do otherwise.

“I’m now going to turn it to my friend and colleague Rich Trumka of the AFL-CIO.

“Before I do, I would like to commend the AFL-CIO for everything they do to stand up for workers here in the United States and across the world.

“In 2008, the AFL-CIO worked with Guatemalan labor groups to file the original petition, which ultimately led to the United States initiating this case.

“Undaunted by the challenges, the AFL-CIO has shown a commitment to improving the labor situation on the ground in Guatemala, and they have collaborated closely with USTR and the Department of Labor to gather facts and build this case.

“Rich, thank you and your team. With that, I’ll turn it over to you.

“Thank you, Chris. Before we finish, I’d again like to commend Rich Trumka and the AFL-CIO for their tireless work on this case. 

“And I want to thank Ranking Member Levin and Representatives Becerra and Price for being here with us today.  I appreciate your dedication and commitment to standing up for American workers, and value the close partnership we have on our broader trade agenda.

“The labor enforcement case announced today underscores one of the core principles of our trade policy: that we can – and must – shape the terms of trade so that its benefits are broadly shared.

“I look forward to continuing to work closely with Congress, stakeholders and the public in pursuit of a trade policy that creates economic opportunities, supports jobs, and upholds our fundamental values.”