Proposed USMCA Labor Rules Called Vague on Procedures, Evidentiary Standards

1, giving Mexican workers collective bargaining rights for the first time, plus protecting them against retaliation for joining unions or refusing to join. The committee, co-chaired by Labor Secretary Eugene Scalia and U.S. Trade Representative Robert Lighthizer, has the authority under USMCA’s “rapid response labor mechanism” to rescind a product's duty-free status or bar its import if it finds the goods were manufactured in a facility with serious labor violations. It’s charged with deciding if “sufficient, credible evidence” exists of a “denial of rights” at a facility that would trigger the “good-faith invocation of enforcement mechanisms,” said interim “procedural guidelines” in a June 30 notice. But there’s concern with the “lack of clarity” in the guidelines about what constitutes “sufficient, credible evidence” because it’s not a “well-understood evidentiary standard in the U.S.,” commented the National Retail Federation. “This ambiguity may invite the filing of frivolous, fraudulent, or malicious claims to injure the reputation of an employer or burden the employer for anti-competitive purposes.” NRF also urged the committee to require in the guidelines that petitions and associated reviews “not stray beyond what is mandated” in USMCA. The committee should explicitly say it won’t accept petitions that include claims other than denial of rights allegations for joining unions or participating in collective bargaining talks, it said. Adding such clarifications “will keep the guidelines consistent” with USMCA, ensuring the committee’s “review processes and resources are used as intended,” said NRF. Amend the guidelines to require that a targeted facility “be notified within 14 days” that a petition of wrongdoing has been filed, said the National Association of Manufacturers. “This would ensure that manufacturers are aware of potential enforcement actions against their business partners.” NAM, like NRF, also wants the committee to define the standard of “sufficient, credible evidence” of a violation, and to “delineate clearly how the committee will review petitions and make final determinations.” Additionally, create “a detailed process” enabling a factory accused of denying workers' rights to file an appeal within 30 days, especially “for cases in which the complainant party does not act in good faith,” NAM said. It defined lack of good faith as including petitions submitted frivolously. The committee’s “determinations” process “requires greater elaboration” lacking in the June 30 guidelines, said the U.S. Council for International Business. The guidelines are silent about how the committee “makes a finding, whether by a vote or some other method, and if there is a right to dissent,” it said. There's also nothing spelled out about the rights of a company facing allegations of wrongdoing in its factories, “including the ability for the company to present its own evidence as well as challenge allegations made by a petitioner,” it said. “Under no circumstance should a company be left out of the process for determinations.”