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The Battle for Control of Mexico's Unions : At Odds Are the Traditionalists and the Progressives


MEXICO CITY — Francisco Hernandez Juarez turned telephone company workers into telephone company shareholders. He turned an eclectic group of small unions into a strong voice for skilled workers demanding reform in organized labor.

Along the way, the bearded, bespectacled 43-year-old secretary general of the 50,000-member telephone workers union has become the personification of a new labor movement in Mexico. He is a labor leader who proposes change instead of opposes it, who bluntly tells his members that their jobs may depend on their efforts to improve the nation's inadequate telephone system, and who is willing to stake pay raises on higher productivity.

That makes him essential to President Carlos Salinas de Gortari's government, which is determined to move Mexico forward from developing-nation status to compete successfully among the world's industrialized economies. Thus, Hernandez Juarez, who represents workers at Telefonos de Mexico--a company with a high profile on foreign stock markets--is Exhibit A for a government trying to sell Mexico to international investors.

But Hernandez Juarez's message--that the restructured economy requires fundamental changes in organized labor--also makes him a threat to Mexico's traditional labor movement, which is doing all it can to undercut his influence.

Fidel Velazquez, the venerable, 93-year-old leader of Mexico's largest labor federation, has personally attacked Hernandez Juarez and publicly given his support to a dissident movement within the telephone union.

"Don Fidel, who was practically my godfather, has declared war on me," Hernandez Juarez acknowledges, still using the title of respect commonly applied to the aging leader.

The war is for control of Mexican labor, once a well-oiled, vote-gathering machine that has grown creaky in the last decade. Velazquez's Federation of Mexican Workers, known as the CTM, represents a system of old-style labor bosses who derive their clout from control of large numbers of rank-and-file workers. Hernandez Juarez's influence comes from a relatively small number of strategically placed skilled workers.

Which force ultimately prevails is of keen interest to U.S. firms looking for opportunities south of the border under the proposed North American Free Trade Agreement. Hernandez Juarez's movement offers the promise of a labor leadership that understands international competition and is willing to cooperate in meeting quality and productivity goals.

Ten years ago, the CTM had real economic and political power. Labor leaders headed congressional committees and governed states. The federation could demand and get contracts that kept members' wages and benefits ahead of inflation. In return, union rank and file loyally turned out at political rallies and voted for the ruling Institutional Revolutionary Party, known as the PRI.

But as wages eroded, so did party loyalty. In the highly disputed 1988 presidential election, it became painfully obvious that the CTM could no longer get out the vote.

The federation has been just as incapable of responding to an economic policy that has relied heavily on wage controls to lower inflation. It has also failed to stem massive layoffs from the government's selloff of state-controlled industries.

"The traditional labor movement is finished," said labor consultant Agustin Arrangoiz. "The modern world economy will not let unions stay the same." Hernandez Juarez, he adds, "has turned himself into the grand alternative."

Hernandez Juarez's office, on the second floor of a modest building only a couple of blocks from bustling Paseo de la Reforma, is filled with paintings and statues of Don Quixote, in papier-mache, wood, onyx and just about any other material imaginable.

Most are gifts from admirers, he says, and most came with notes alluding to Hernandez Juarez's quixotic quest to reform the Mexican labor movement. But those who have watched the labor leader over the years say the comparison is not quite accurate. He took over the telephone union at age 26, and is not a man given to tilting at windmills.

"He does not like for people to say this, but he is a very pragmatic guy," said Raul Trejo Delarbre, an investigator who has studied the labor movement.

Unlike traditional unions, which have continued--unsuccessfully--to demand wage hikes in the face of clear evidence that companies buffeted by international competition could not afford them, Hernandez Juarez has considered management problems in his negotiations.

"He realizes that if there is no company, there is no union," said Pilar Vazquez, a researcher who has studied the telephone workers union. At a recent two-hour meeting with telephone operators, Hernandez Juarez warned them that their company will ultimately face competition.

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