US embassy cable - 03GUATEMALA2753

UNCLAS SECTION 01 OF 03 GUATEMALA 002753 
 
SIPDIS 
 
SENSITIVE 
 
DEPARTMENT FOR WHA/CEN, WHA/PPC, DRL/IL AND G/TIP 
USTR FOR BUD CLATANOFF 
USDOL FOR ILAB (R. WHOLEY AND J. PEREZ-LOPEZ) AND OFR (G. 
RUSSELL) 
 
E.O. 12958: N/A 
TAGS: ELAB, PGOV, SMIG, KCRM, PHUM, GT 
SUBJECT: GUATEMALA LABOR/TIP UPDATE #7-2003 
 
 
1.  (SBU) Summary:  Following is an update of significant 
recent developments in the labor sector and trafficking in 
persons.  Topics include: 
 
-- Political Parties Respect Labor Rights (para #2) 
 
-- Fired Maquila Workers Reinstated (3) 
 
-- GOG GSP Submission Incomplete (4) 
 
-- Changes Likely to Labor Reforms in Congress (5) 
 
-- CA Labor Ministers Support CAFTA; GOG Rejects OSH 
Foundation (6-7) 
 
-- MOL Initiatives:  Indigenous and Women Workers (8) 
 
-- Minimum Wage Hike Likely (9) 
 
-- Miscellaneous Labor Conflicts (10) 
 
-- TIP - Migration Dir. Pledges Increased TIP Enforcement (11) 
 
-- TIP - UNICEF PR Campaign Against Unaccompanied Minors (12) 
 
End Summary. 
 
Political Parties Pledge Respect for Labor Rights 
--------------------------------------------- ---- 
 
2.  (U) On October 13, twenty-one political parties, 
including the ruling FRG and all the main opposition parties, 
agreed upon and signed a "Shared National Agenda" to promote 
national development, subsequently published in the press. 
The agenda includes the following points under the theme of 
employment: 
 
-- participate in the creation of a labor policy with the 
objective of generating new labor relations and addressing 
the deficit in the quality and quantity of employment 
opportunities, violation of labor rights, inadequate social 
protections and social dialogue; 
 
-- enact and enforce national labor legislation and ILO 
commitments ratified by the GOG; and, 
 
-- progressively eliminate child labor, preventing children 
from dangerous situations or slavery, perpetuating a vicious 
circle of poverty. 
 
Fired Maquila Workers Reinstated 
-------------------------------- 
 
3.  (SBU) The Korean-owned textile maquila NB (Nobland) Inc. 
agreed on October 27 to reinstate three workers fired on 
October 16 for attempting to form a union.  The company 
agreed to do so at the request of labor inspectors and U.S. 
customers (the GAP, JC Penney).  Management lawyers also 
invited beverage and maquila federation lawyers to begin a 
dialogue about the labor conflict.  The nascent union is 
likely to be registered by the Labor Ministry shortly, 
according to the Labor Minister, which would raise to three 
the number of factory-based unions in the 200-firm maquila 
sector.  The Solidarity Center claims the workers have the 
25% support to compel collective bargaining. 
 
GOG GSP Submission 
------------------ 
 
4. (SBU) The MFA sent the Embassy what appears to be an 
advance copy of the GOG's 40-page GSP hearing submission due 
to USTR by October 31.  The report contains useful 
information about various fines, MOL budget increases, and 
the status of labor conflicts raised in the GSP petitions, 
including a report of substantive progress in the Finca Maria 
Lourdes plantation.  An annexed report from the Public 
Ministry about the progress of investigations of cases of 
criminal violence against union members is missing from our 
copy. 
 
Changes Likely to Labor Reforms in Congress 
------------------------------------------- 
 
5.  (SBU) Minister of Labor Victor Moreira told LabAtt on 
October 23 that he believes Congress will modify pending 
labor code reforms to eliminate the option of reinstatement 
for unjustifiably fired workers.  Employers would still owe 
an amount equivalent to severance pay (one month per year 
worked) to these workers.  Moreira said that many of the FRG 
Congressional deputies are themselves employers, and agree 
with objections from CACIF that allowing workers to decide 
whether to accept severance or keep their jobs would impinge 
on employer rights to fire unneeded workers.  Support in 
Congress for universal severance is boosted by the 
expectation of some Congressional deputies that they 
themselves will soon be out of office and would benefit from 
the severance pay, he said.  (Note:  unions have also 
objected to the reforms, claiming that they were not 
consulted and on the grounds that universal severance would 
undermine the permanence of employment and give employers an 
incentive to hire temporary workers, to reduce severance 
accrual.  End Note.)  On October 27 Moreira predicted that 
the modified reforms would be voted on by Congress on October 
28.  He said he had recommended to President of Congress Rios 
Montt that gender discrimination be more explicitly addressed 
in the Labor Code, to bring it in line with the Constitution. 
 (Note:  based on the ILO analysis of legal labor protections 
in Central America, we had encouraged the MOL and the 
employer association (CACIF) to consider such a change. 
CACIF made the same recommendation to Congress.  End Note.) 
 
Council of Labor Ministers:  CAFTA, OSH Foundation 
--------------------------------------------- ----- 
 
6.  (U) The Council of Ministers of Labor of Central America 
and the Dominican Republic issued a Declaration, signed by 
the ministers in Guatemala City on October 17, which includes 
a preambular clause stating: 
 
"Considering: that the inclusion of a labor clause is 
fundamental to integrate labor issues into the process, but 
should not become an obstacle in any way to international 
commerce; every country must guarantee the enforcement of its 
own laws and respect for fundamental labor rights;" 
 
And concludes: 
 
"We Agree: To request the USG, in its negotiation with 
Central American nations, to allow a treaty which plainly 
benefits both sides, based on free, fair and just trade, and 
the construction of a future hemispheric market.  In this 
sense we express our total support for the negotiation of a 
CAFTA." 
 
7.  (SBU) Moreira told LabAtt on October 23 that he had 
informed the Central American Labor Ministers' Conference and 
USDOL/OFR that the GOG disputes the approval of a 
newly-established regional occupational health and safety 
foundation (FUNDAPROSO) at the previous ministers' meeting in 
Managua.  Furthermore, the Guatemalan Constitution prohibits 
any GOG financial support for private entities;  FUNDAPROSO, 
if constituted as a private entity in El Salvador, as 
proposed, would be ineligible for GOG support under 
Guatemalan law. 
 
Recent MOL Initiatives 
---------------------- 
 
8.  (U) The Labor Ministry has launched initiatives to 
promote and defend the rights of women and indigenous 
workers.  On August 20 the Labor Ministry issued a 
ministerial accord (#364-2003) creating a Department of 
Indigenous Peoples to investigate cases of discrimination and 
promote implementation of ILO Convention 169 on the rights of 
indigenous workers.  The initiative includes the designation 
of ministry representatives located in heavily-indigenous 
provinces, investigation of discriminatory hiring practices 
and coordination with the labor inspectorate and Human Rights 
Ombudsman's office to protect indigenous worker rights.  In a 
letter to the Embassy dated September 9, Minister of Labor 
Moreira described his Ministry's efforts to promote the 
rights of women workers through a series of workshops 
involving workers (515), managers (339), inspectors (281), 
and local collaborators (45) which took place from March to 
September, 2003.  The minister also cited and sent us copies 
of 10 video spots to be broadcast on television, informing 
Guatemalans of their labor rights.  Finally, the Minister 
cited his ministry's efforts to address pending labor 
complaints in the maquila sector, in concert with the Economy 
Ministry and other interested institutions and NGOs. 
 
Minimum Wage Hike Likely, Unemployment Rising 
--------------------------------------------- 
9.  (U) A government-labor-management panel failed to agree 
on a minimum wage hike.  Union leaders demanded 25-40%; 
employers offered 0%.  Worker representatives demanded a 
25-40% raise, saying that the current monthly minimum wages 
for agricultural workers (approx. $150) and non-agricultural 
workers ($159) is well below the government's estimate of 
basic monthly living expenses ($299).  Employers offered 0%, 
citing the downturn in the coffee and other sectors.  As a 
result of the deadlock, President Portillo will likely again 
exercise his authority to approve a wage hike of 7-10% 
sometime before the end of the year.  (Comment:  This will 
probably be announced before the November 9 national 
election.  End Comment.)  According to press reports, the 
National Statistical Institute counted 170,000 unemployed 
between January-March 2003, double the number the previous 
year.  It classified another 812,460 Guatemalans as 
under-employed. 
 
Miscellaneous Labor Disputes 
---------------------------- 
 
10.  (U) Norwegian labor unions, in support of appeals from 
UNSITRAGUA, an independent labor federation which represents 
banana workers in Izabal province, have protested to Chiquita 
Brands the firing of 600 workers on four plantations.  The 
unions allege that the firings are part of an anti-union 
policy on the part of Chiquita to shift production to 
non-unionized plantations on the Pacific Coast.  UNSITRAGUA 
has also protested the lack of labor court action on a 
petition to reinstall 18 workers of 64 allegedly fired 
illegally at Goodyear Tire's local affiliate, GINSA, which 
has been pending in the labor courts for eight months. 
Finally, a Mexican gas distributor (Tomza Inc.) is gaining 
notoriety for alleged threats against workers organizing a 
union, unlawful firings, and flouting labor court rulings. 
After a labor court judge ruled that 27 illegally-fired 
workers be reinstated, the company refused to do so.  The 
judge imposed a fine on the company of $3125 per worker. 
After a second refusal, the judge imposed an additional fine 
of $3750 per worker, but the workers remain outside. 
 
TIP - Migration Director Pledges Increased TIP Enforcement 
--------------------------------------------- ------------- 
 
11.  (SBU) On October 7 DCM, DHSOff and PolOff met with Oscar 
Contreras, Director of Immigration to thank him for recent 
efforts to discover TIP victims in Guatemala City brothels 
and urge further anti-TIP enforcement efforts.  Contreras 
said he was recently returned from a migration conference in 
Geneva where TIP was a principal topic.  The DCM emphasized 
the need to develop cases against traffickers while 
protecting the rights of victims.  Contreras claimed that an 
ongoing prosecution of a corrupt Migration official (and 
union leader) in the Peten involves allegations of complicity 
in trafficking rings.  PolOff and DHSOff urged further 
efforts to find victims who can testify against trafficking 
ringleaders.  Contreras pledged to do so beginning later in 
the month.  (Comment:  Contreras, who entered office after 
Embassy complaints about corruption under his predecessor, 
was eager to curry favor with the Embassy;  his position will 
be put at risk by the change of government in January, 2004. 
End Comment.) 
 
TIP - UNICEF Regional Anti-TIP PR Launched in Guatemala 
--------------------------------------------- ---------- 
 
12.  (U) Press reported October 23 that UNICEF has launched a 
public relations campaign entitled "The Route North" to 
convince Central American parents about the danger faced by 
unaccompanied minors attempting to migrate illegally to the 
U.S., especially the risk of becoming a victim of sexual 
exploitation.  This effort will be supported by 633 radio 
stations throughout the region.  According to the report, 
UNICEF cited 1,200 child rescued from traffickers trying to 
enter the U.S. 
HAMILTON