Biden White House Suffers Embarrassing Defeat Defending Powerful Mexican Labor Union

Biden's trade representative says she was surprised by court case's outcome

U.S. Trade Representative Katherine Tai (Win McNamee/Getty Images)
June 11, 2024

The White House took the unprecedented step of intervening in an international labor dispute last year after a push from powerful U.S. labor unions. Then, months later, a multi-nation tribunal threw the case out, handing a defeat to the administration and its labor allies.

Last year, the AFL-CIO and United Steelworkers—which collectively represent more than 13 million American workers and regularly funnel millions of dollars to Democratic campaigns, according to Federal Election Commission data—made their formal appeal to the White House's Office of the U.S. Trade Representative (USTR), according to legal filings reviewed by the Washington Free Beacon.

In the appeal, the unions called on the administration to invoke a little-known clause in the 2020 North American trade agreement in support of Los Mineros, a Mexican miners' union locked in a years-long labor dispute with the massive San Martin mine in Zacatecas, Mexico. The White House, which regularly claims to be the most pro-union White House in U.S. history, soon obliged and assembled a panel to review the case.

"This announcement upholds the Biden-Harris administration’s commitment to creating a more level playing field for workers to feel empowered and using every enforcement tool at our disposal to safeguard workers’ rights," Trade Representative Katherine Tai said at the time.

The U.S. intervention in the case sparked criticism from the Mexican government, the mine's operator Grupo Mexico, the U.S. Chamber of Commerce, and lawmakers who raised concern over the potential ramifications of USTR's actions. The actions, if successful, could have led to the forceable closure of a facility that employs hundreds of workers and provides key industries with more than a million tons of lead, zinc, copper, and silver, financial filings show.

Critics further argued the actions also could have led to potentially greater U.S. involvement in international labor disputes.

In the case, the White House invoked the so-called Rapid Response Labor Mechanism (RRM), which, under the United States-Mexico-Canada Agreement of 2020 (USMCA), allows enforcement against North American employers proven to violate labor laws. It represented the first time an RRM panel has been assembled since the trade agreement was entered into force.

The panel, comprised of a representative from the United States, Canada, and Mexico, ultimately rejected the case last month in a sprawling 119-page report firmly rejecting the USTR's arguments that Grupo Mexico had violated workers' collective bargaining rights at the San Martin mine. Panel members ruled in part that the U.S. government couldn't invoke the USMCA in a case that preceded the trade agreement.

"I have ongoing concerns that the Rapid Response Labor Mechanism under USMCA is not being used as it was intended," Rep. Carol Miller (R., W.Va.) told the Free Beacon. "The USTR continues to prove they are beholden to big labor interests at the detriment of American workers."

"Unfortunately, the American people will continue to bear the brunt of the Biden administration's weak leadership and misguided priorities," Miller continued. "I encourage Representative Tai to focus [and] take active steps to use RRM as Congress intended when we passed President Trump's USMCA and put Americans first."

Miller wrote to Tai earlier this year in a letter obtained by the Free Beacon, probing her office's use of the RRM in the case.

Tai, however, characterized the panel's final determination as "both surprising and disappointing." And Deputy Undersecretary for International Labor Affairs Thea Lee said that while the ruling failed to deliver justice to Mexican workers, the administration would continue to "protect freedom of association and collective bargaining rights in Mexico."

The United Steelworkers said the ruling was "simply unacceptable."

"The failure to find a denial of rights at the company sends a message that the rights of corporations outweigh those of workers," the union said in a statement.

The case stems from a strike organized in 2007 by Los Mineros at the mine over work safety conditions and pay. The mine reopened more than a decade later after Grupo Mexico entered into an agreement with Los Trabajadores Coaligados, a new coalition of miners that sought a return to work.

Despite subsequent government rulings confirming that the strike had officially ended with that agreement, Los Mineros argued the agreement was a violation of labor law.

"The tribunal's findings demonstrate that the United States should never have started Rapid Response Labor Mechanism proceedings against Grupo Mexico in the first place," Jonathan Stoel, a partner at Hogan Lovells, a law firm that represented Grupo Mexico in the case, told the Free Beacon in a statement.

Los Mineros and its general secretary, Napoleón Gómez Urrutia, have faced scandal in the past. Years ago, a Mexican court ordered Los Mineros and Urrutia to pay $54 million in an alleged embezzlement scheme.

That led Urrutia and his family to flee Mexico for Canada in 2006, where they remained until 2018. His return was aided by Mexican president Andrés Manuel López Obrador, who appointed Urrutia to the nation's Senate chamber. Most members of the Mexican Senate are elected while a small minority are selected by political parties.

The Los Angeles Times reported that the embezzlement charges against Urrutia were dropped in 2014.

The AFL-CIO and United Steelworkers are longtime allies of Urrutia. In 2011, the AFL-CIO nominated the Mexican labor leader for a top human rights award, and the United Steelworkers issued a congratulatory statement when Urrutia returned to Mexico from exile.

Los Mineros and the AFL-CIO did not respond to requests for comment.