US embassy cable - 03GUATEMALA137

UNCLAS SECTION 01 OF 02 GUATEMALA 000137 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR DRL/IL:GEORGE WHITE AND WHA/PPC:CHARLOTTE ROE 
USTR FOR ANDREA DURKIN AND BUD CLATANOFF 
DEPT OF LABOR FOR ILAB: ROBERT WHOLEY 
 
E.O. 12958: N/A 
TAGS: ETRD, PHUM, PGOV, ELAB, PREL, GT 
SUBJECT: USING THREAT OF GSP REVIEW TO PREPARE FOR CAFTA 
 
 
1.  (SBU) Summary:  Pending further steps from the GOG to 
protect labor rights, Embassy recommends that USTR inform the 
Guatemalan Embassy in Washington (and the Department instruct 
us to inform the GOG here) that the GSP petition is under 
informal USG review pending an assessment of current GOG 
efforts in three areas.  We believe that doing so could lead 
to progress in:  bringing overdue criminal prosecutions to 
court; streamlining the labor justice system; and reinstating 
illegally fired workers.  End Summary. 
 
Background 
---------- 
 
2.  (SBU) On December 2, the AFL-CIO filed a petition with 
USTR to withdraw GSP benefits from Guatemala due to lack of 
compliance with labor rights conditions.  The International 
Labor Rights Fund also submitted petitions against Guatemala 
and El Salvador.  We have reviewed the AFL-CIO petition, but 
not that of the ILRF. 
 
3.  (SBU) Guatemala has been reviewed many times over past 
decades, but has never lost GSP benefits.  This review would 
be the first since USTR announced in May 2001 suspension of 
review of Guatemala in the wake of passage of major Labor 
Code reforms and sentencing of labor violators in the SITRABI 
trial.  At that time and since, the USG has repeatedly 
expressed concern that the revised labor code be effectively 
enforced. 
 
4.  (SBU) The standard for labor rights compliance with GSP 
is broad and low (i.e. for the GOG to be "taking steps" to 
afford its workers their internationally recognized labor 
rights).  Thus Guatemala's immediate problem is less the 
massive labor violations that occur every day than the 
impunity that labor rights violators generally enjoy, despite 
adequate protections in law.  That impunity stems from a weak 
labor justice system, a weak criminal justice system, and 
weak labor code enforcement measures by the Executive.  The 
DYMEL case was a good example of this, until US interests 
spurred us to take corrective action.  The end result was a 
happy exception to the rule that even if workers win in 
court, labor violators can avoid justice. 
 
The Petition 
------------ 
 
5.  (SBU) The AFL-CIO petition is generally accurate 
describing specific failures of the GOG to guarantee labor 
rights.  It describes many notable cases in which fundamental 
labor rights, including the right to organize a union, have 
been flagrantly violated by employers, who often dismiss 
labor organizers in violation of labor code protections. 
Labor courts often rule against employers (as in the DYMEL 
case), but sentences are not enforced if employers refuse to 
reinstate illegally fired workers. 
 
6.  (SBU) Even more serious are a series of unsolved murders 
of labor leaders (the GSP petition mentions six since January 
1999; MINUGUA cites four in the period 1/1/2000-9/15/02; 
another murder occurred in late November, 2002).  In response 
to international criticism (from the ILO and under the GSP 
process) the Public Ministry formed a new Special Prosecutor 
for Crimes Against Unionists and Journalists in July 2001, to 
centralize investigation of these cases.  However, the 
Special Prosecutor's Office suffers from the usual resource 
constraints and is regarded as hostile to labor concerns by 
unions.  As of September 2002, the MP had issued only two 
arrest warrants for 51 open cases. 
 
7.  (SBU) The petition also describes some cases which have 
since been resolved to a certain extent or been addressed by 
non-government actors: 
 
-- Coca Cola's local bottler recently agreed to a collective 
bargaining agreement with its union; 
 
-- Jalapa municipal workers struck in 2002, but returned to 
work after concessions from the mayor; 
 
-- Choi Shin-Cimatextiles maquila has instituted regular 
meetings with its unions, though nobody has been charged for 
earlier violence there; 
 
-- ILO/IPEC has announced a new project to combat child labor 
in the Guatemala City municipal dump. 
 
8.  (SBU) Finally, the petition ignores positive GOG actions 
(or "steps") on some fronts.  In 2002, these positive actions 
included the creation of a consensual National Plan for 
Occupational Health and Safety in 2002, cooperation with the 
ILO's International Program to Eliminate Child Labor in 
several sectors of the economy, and the revitalization of the 
Labor Ministry under a new labor minister, Victor Hugo Godoy. 
 Godoy took office in February 2002, has had some success 
reforming his ministry internally, while maintaining good 
relations with AID and the Embassy, and has moderated the 
antagonism between his predecessor and the private sector. 
Labor Ministry fines are up, (the total is more than 10 times 
the total imposed by labor courts in the past 50 years, 
according to Labor Minister Godoy) though they are lower than 
permitted under the new labor code. 
 
9.  (SBU) In 2001, we used the pressure of formal GSP review 
to support legislative changes to bring the Guatemalan labor 
code in compliance with its ILO commitments.  Though the 
outcome was what the USG sought, it came at some political 
cost.  The resulting reforms gave the Labor Minister new 
enforcement powers, which have not been forcefully exercised 
since employers have recourse to the courts, but which 
represent a real advance in the law.  However, despite the 
increase in fines cited by the minister, the situation facing 
most Guatemalan workers who try to form unions is little 
changed. 
 
Recommendation 
-------------- 
 
10.  (SBU) Given this situation, Embassy wishes to encourage 
further GOG remedial actions to protect labor rights.  We 
therefore recommend that USTR inform the Guatemalan Embassy 
in Washington (and the Department instruct us to inform the 
GOG here) that the GSP petition is under informal review 
(i.e. that a formal USTR decision will be made after the 
Embassy assesses GOG progress accomplishing the elements 
outlined below). 
 
A.  Bring overdue criminal prosecutions to court and replace 
Special Prosecutor: 
 
We will suggest that the Attorney General replace the current 
Special Prosecutor for Crimes Against Unionists, given the 
latter's poor performance.  As in other areas of law 
enforcement interest, we will press for results on 
outstanding criminal cases, particularly unsolved murders. 
The AG will want resource support to accomplish this, and we 
should consider that request when it comes.  NAS is already 
planning to donate used excess computer equipment from other 
Public Ministry programs. 
 
B.  Streamline the labor justice system: 
 
While the former minister introduced draft legislation to 
speed labor enforcement, it has not been acted on by Congress 
and is not supported by labor or employer groups.  Instead, a 
labor justice committee was formed by the GOG with UNDP 
support and participation by judicial system and Executive 
branch members, and civil society (labor and employer 
groups).  We should support this effort, and press for 
concrete results (consensual administrative and legislative 
changes to improve the labor justice system, including more 
vigorous police enforcement of judicial sentences). 
 
C.  Reinstate illegally fired workers: 
 
The AFL-CIO GSP petition cites the Finca Maria Lourdes case 
as emblematic of the problems of reinstating workers fired 
for attempting to organize a union on a traditional coffee 
plantation.  It also involves an affiliate of the labor 
federation directly supported by the AFL-CIO.  We will urge 
that the GOG effect a resolution (through reinstatement or a 
financial settlement of workers claims) of this case. 
Hamilton