Law360 Publishes Akin Gump Article on USMCA Approach to Labor Dispute Settlement

Law360 has published the article “USMCA’s Labor Dispute Tool Raises Hurdles For Mexican Cos.,” written by Akin Gump labor and employment partners Brian Patterson and Bob Lian and international trade partner Stephen Kho and associate Sarah Kirwin, as well as attorneys and staff from Dorantes Advisors. The article examines a new approach to labor dispute settlement that is included in the U.S.-Mexico-Canada Agreement (USMCA).

Known as the facility-specific rapid response labor mechanism (RRLM), the authors write that an ad hoc international dispute settlement panel will be authorized “to make a determination as to whether a specific facility is in compliance with Mexico’s new labor reforms.” The RRLM, the article notes, “was developed late in the USMCA negotiations after Democrats in the U.S. Congress and prominent U.S. labor groups expressed concern that Mexico would fail to adequately implement its labor law reforms.”

The article discusses how the RRLM works, noting that it “streamlines the dispute process by allowing U.S. Customs and Border Protection to impose remedies on a noncompliant facility within 125 days of the initiation of a complaint.” The article then answers the following questions:

  • Who can trigger a request under the RRLM?
  • What remedies might be imposed under the RRLM?
  • What sectors are affected?
  • What are the effects of the implementation of the RRLM in Mexico?

The authors conclude with a look at how Mexican covered facilities should prepare for implementation of the USMCA.

To read the entire article, which originated as an Akin Gump client alert, please click here.