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Industrial Relations in the Oil Industry in Mexico

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Industrial Relations in the Oil Industry in Mexico WP.239 SECTORAL ACTIVITIES PROGRAMME Working Paper Industrial relations in the oil industry in Mexico Carlos Reynoso Castillo Working papers are preliminary documents circulated to stimulate discussion and obtain comments International Labour Office Geneva 2005 Copyright © International Labour Organization 2006 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to the Publications Bureau (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland. The International Labour Office welcomes such applications. Libraries, institutions and other users registered in the United Kingdom with the Copyright Licensing Agency, 90 Tottenham Court Road, London W1T 4LP [Fax: (+44) (0)20 7631 5500; email: [email protected]], in the United States with the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923 [Fax: (+1) (978) 750 4470; email: [email protected]] or in other countries with associated Reproduction Rights Organizations, may make photocopies in accordance with the licences issued to them for this purpose. ISBN: 92-2-118853-1 & 978-92-2-118853-7 (print) ISBN: 92-2-118854-X & 978-92-2-118854-4 (web pdf) The designations employed in ILO publications, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the International Labour Office concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the International Labour Office of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the International Labour Office, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. ILO publications can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publications, International Labour Office, CH-1211 Geneva 22, Switzerland. Catalogues or lists of new publications are available free of charge from the above address, or by email: [email protected] Visit our web site: www.ilo.org/publns Printed by the International Labour Office, Geneva, Switzerland Preface Oil and gas are essential components of modern, industrialized civilization, and as societies and economies grow, so does their oil and gas industry. The oil and gas industry has revolutionized human lives, improving our standard of living. Its products constitute building blocks at every level of production and consumption in key sectors of economic life. A stable supply of oil and gas is therefore needed to sustain continued development of our economies. The oil and gas industry is a highly capitalized industry. Much of the manual work has been replaced by automation, but significant parts of the operation still rely on human input. Sound employer-employee relations are therefore crucial to the stable production and supply of oil and gas. In 2005, the Sectoral Activities Programme of the ILO commissioned four national studies on the subject of industrial relations in the oil industry. The aim of this paper, the fourth in the series, is to explore some practices in industrial relations and social dialogue in the oil sector in Mexico. The paper was prepared by Prof. Carlos Reynoso Castillo, jurist and professor of law in Mexico. He has made an important contribution to the improvement of industrial relations in the oil and gas industry in Mexico. The ILO hopes that this study will provide an opportunity to consider how industrial relations can be improved in the interests of both decent work and greater prosperity of the industry. Elizabeth Tinoco, Chief, Sectoral Activities Branch (SECTOR), Social Dialogue, Labour Law, Labour Administration and Sectoral Activities Department, Social Dialogue Sector, International Labour Office (ILO). WP-External-2006-06-0210-1-En.doc iii Contents Page Preface............................................................................................................................................... iii List of abbreviations and acronyms................................................................................................... vii 1. Overview of the oil industry in Mexico .................................................................................... 1 1.1. Overview of Petróleos Mexicanos (PEMEX)............................................................... 1 1.2. Economic and social contribution of the oil industry in Mexico.................................. 2 1.3. Natural gas.................................................................................................................... 3 1.4. Structural problems at PEMEX .................................................................................... 4 1.4.1. Punitive tax structure........................................................................................ 5 1.4.2. External debt..................................................................................................... 5 1.4.3. Technology gap ................................................................................................ 5 1.5. Energy policy................................................................................................................ 6 1.6. Privatization of PEMEX petrochemicals...................................................................... 7 1.7. Towards building the new business model ................................................................... 8 1.8. Fair social governance .................................................................................................. 9 1.9. Workforce..................................................................................................................... 10 1.10. Female workforce at PEMEX....................................................................................... 11 2. Conditions of work.................................................................................................................... 12 2.1. Wages and fringe benefits............................................................................................. 12 2.2. Wage increases ............................................................................................................. 14 2.3. Working time ................................................................................................................ 15 2.4. Overtime premium........................................................................................................ 16 2.5. Paid leave...................................................................................................................... 16 2.6. Collective bargaining.................................................................................................... 18 2.7. Relocation of workers................................................................................................... 19 2.8. Education ...................................................................................................................... 20 2.9. Vocational training ....................................................................................................... 20 2.10. Occupational safety and health and environmental protection ..................................... 21 2.10.1. Legal framework .............................................................................................. 21 2.10.2. Accidents at work and the environment ........................................................... 22 3. Employer-employee relations ................................................................................................... 25 3.1. Dialogue at PEMEX ..................................................................................................... 25 3.2. Bipartite decision-making............................................................................................. 26 3.3. Tripartism in deciding wage increases.......................................................................... 27 3.4. Issues concerning industrial relations ........................................................................... 27 WP-External-2006-06-0210-1-En.doc v 3.5. New labour culture........................................................................................................ 28 3.6. Unionization.................................................................................................................. 28 3.7. Union of Oil Workers of the Mexican Republic (STPRM) ......................................... 29 3.8. Contract work ............................................................................................................... 29 3.9. Freedom of association and the right to strike .............................................................. 30 3.10. Female representation in negotiation ............................................................................ 31 3.11. Protecting workers in time of change ..........................................................................
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