More than 30,000 workers at approximately 45 companies in Matamoros, Tamaulipas, recently went on strike demanding a 20% salary increase, plus a one-time annual bonus of MXN $32,000 (approximately USD $1,700), to reach an agreement and resume their work activities.  Matamoros, located near the Mexico-US border, is home to a conglomeration of manufacturing factories known as “maquiladoras.”  To date, the strikes reportedly have caused the maquiladoras industry a loss of USD $50 million a day .¹

The strikes were called by the members of the Union of Laborers and Industrial Workers of the Maquiladora Industry (known as “SJOIIM”).²  Their demands disregard the government’s recent increase in the minimum wage.  As we recently reported, on December 26, 2018, the CONASAMI (Mexico’s National Commission of Minimum Wage)³ increased the daily minimum wage for the border area, from $88.76 pesos to $176.72, representing a 100% increase.  However, in its official decree, the government declared that the increase in the minimum wage was actually only 5%, designating the remaining amount as an “independent recuperation amount,”⁴ designed to restore and strengthen employees’ purchasing power.

Further, SJOIIM demands the 20% increase, plus the one-time bonus, based on a clause of the current collective bargaining agreement (CBA) that establishes that employee salaries shall be increased based on the amount resulting from the application of the minimum wage percentage increase and on common practice between the companies and SJOIIM. SJOIIM argues that to comply with such clause, the increase amount must be multiplied by 365 (instead of applying the increase directly to the daily salary), resulting in the MXN $32,000 bonus they demand.

To date, most of the companies have agreed to the workers’ demands. Other companies in Matamoros that are not subject to a CBA or similar contractual obligations with SJOIIM are dealing with illegal work stoppages and have been threatened with a strike if they fail to agree to the 20% salary increase and the bonus payment.  Without a resolution, this situation may reach the entire Mexico-US border area and beyond, impacting employers’ bargaining power throughout the entire country, especially if employees begin demanding a wage increase higher than the typical four or six percent.