Collective bargaining agreements could be revised down; in 2021, they will be under examination

Note published in El Economista, Empresas [Companies] Section by María del Pilar Martínez.
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In trade unions, what is known as “shaving collective bargaining agreements” is reducing benefits, in said agreements, that are higher than the ones required by law.

As never before, companies have had to present proper strategies that allow them to maintain operations and their workforce; therefore, at the beginning of 2021, there is the possibility that Collective Bargaining Agreements (CCTs) will be revised once again, but this time, they could be revised down.

In trade unions this is known as “shaving collective bargaining agreements”, that is, it is legally valid to reduce those benefits that go beyond those required by law in these agreements, meaning that “our Federal Labor Law is a law of minimums. Therefore, workers’ victories that have already been won, such as increasing the year-end bonus from 15 to 40 days could change in the new revision of the agreement”, said Jorge Sales Boyoli, labor specialist at the Sales Boyoli Firm and coordinator of the Labor Committee of the National Association of Business Lawyers (ANADE).

He added that, according to the jurisprudence criteria of the Supreme Court of Justice of the Nation, “it is valid to revise Collective Bargaining Agreements down; therefore, 2021 will be a year full of many challenges and it should probably not be surprising that some agreements are revised down, that is, that their labor costs are adjusted in order to reduce them.”

Given that the labor outlook at the beginning of this year is uncertain, not only due to the behavior of the economy in the different sectors, but also because decisions and measures that have a direct impact on labor relationships in the labor arena have been taken in parallel, this could become a constant in contractual revisions.

“The labor agenda in 2021 is very complex, first because there are reform bills that are still pending, as in the case of outsourcing, which will be readdressed in the month of February; it is possible that the bill on Teleworking will be published in the Official Gazette of the Federation, to enter into force, and it brings numerous changes and important obligations, and there is also the topic of the new labor justice system”, explained Sales Boyoli.

Growth of alternative agreements

He explained that airlines and banks have historically resorted to strategies such as creating parallel collective bargaining agreements; then, they have Agreement A and Agreement B and they keep all the old benefits in the first one and they create another agreement for new arrivals, with benefits that are less costly for the employers,

“We might see that type of union volatility in CCTs; but if what we want is to preserve the source of work, we need to see how to avoid a drop in the number of jobs, hopefully the government reconsiders providing support to employers to face all of the challenges that are coming, with the objective of not further jeopardizing employment”, added Sales Boyoli.

On the other hand, it should be noted that companies will start promoting the possibility that in the voting process to choose a union – headcount – a part will be included in which the worker implicitly has the option of not belonging to any union; “that is true freedom of association, that is, giving workers the choice of not belonging to a union without this affecting their labor relationships”, said labor lawyer Óscar de la Vega, of the D&M Firm.