Washington to act over Guatemala labour violations

US Trade Representative Ron Kirk has announced that that the United States will file a case against Guatemala under the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR), for apparent violations of obligations on labour rights. This is the first labour case the United States has ever brought against a trade-agreement partner.At risk, according to figures issued by OTEXA, the US Office of Textiles and Apparel, are more than $5 million of textile exports to the US market.“We want to see the Government of Guatemala take specific and effective action – including, if appropriate, legislative reforms – to improve the systemic failures in enforcement of Guatemalan labour law,” Ambassador Kirk said. “In addition, the issue of labour-related violence is a matter of serious concern to the United States. Our request for consultations also expresses our grave concerns about this problem and indicates that we intend to take this issue up with the Government of Guatemala in the near future.”In April 2008 the AFL-CIO and six Guatemalan unions filed a public submission under the CAFTA-DR, alleging that the Guatemalan government is failing to effectively enforce its labour law. Since then the US government has conducted an extensive examination of Guatemala’s compliance with its obligations under the Labor Chapter of the CAFTA-DR. The US has engaged in informal discussions with the government of Guatemala since the US Department of Labor issued a report in January 2009, where it found systemic weaknesses in the country’s enforcement of its labour laws and raised concerns about labour-related violence.Now the consultations will be formalised and the CAFTA-DR provides that, if the parties have failed to resolve the matter within 60 days, the complaining party may request a meeting of the agreement’s Free Trade Commission. The US government says it will assess what it learns in consultations and determine whether to seek to resolve outstanding issues through a Chapter 20 dispute settlement process.A dispute panel has the power to impose an annual $15 million penalty.