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Sprint embroiled in NAFTA labor dispute
Telephony / January 22, 1996

By Larry Luxner

WASHINGTON -- A Mexican labor union is accusing the United States of failing to enforce its own labor laws in a case involving Sprint Corp.'s now-defunct long-distance subsidiary, La Conexión Familiar.

The case first came to light in July 1994, when the Communications Workers of America complained to the National Labor Relations Board that Sprint had unlawfully closed the San Francisco long-distance facility because its predominantly Hispanic employees were trying to organize. After conducting an investigation, the NLRB sued Sprint in September 1994; five months later, Mexico's Sindicato de Telefonistas de la Republica Mexicana filed its own petition under a NAFTA side agreement on labor.

Sprint insists that it folded the subsidiary for economic reasons only -- a claim backed by administrative law judge Gerald Wacknov, who ruled last August that the shutdown was lawfully motivated and therefore did not violate Section 8(a)(3) of the National Labor Relations Act.

"La Conexión Familiar was closed down more than a year ago," said Bill White, Sprint's assistant vice-president for corporate communications. "It was losing on average $4 million a year, and saw its customer base drop from over 200,000 to 75,000 because new competing services were being introduced by MCI and AT&T. La Conexión, with its single product line, was unable to compete."

Yet Wacknov found that Sprint had in fact violated Section 8(a)(1) of the Labor Act by "threatening employees with plant closure, by interrogating employees regarding their union activities, and by other similar conduct."

White, who says the subsidiary's 235 workers were being paid an average of $8 an hour, concedes "there were some supervisors who broke NLRB rules in the way they spoke to employees and what was said to employees. They did this contrary to any training they received from Sprint. This is not the way we do business."

Under terms of NAFTA's North American Agreement on Labor Cooperation, the U.S., Canada and Mexico each have National Administrative Offices (NAOs) to study labor laws and investigate charges of unequal competition and violations of workers' rights. If sustained by investigatory panels, the Dallas-based NAALC Secretariat can order trade sanctions against the offending nation.

Following ministerial-level consultations over the La Conexión Familiar case, U.S. Labor Secretary Robert B. Reich and his Mexican counterpart, Javier Bonilla, on Dec. 17 agreed to hold a public hearing on the issue in San Francisco within 120 days.

Yet Jerome Levinson, a labor attorney and visiting professor at the American University Law School in Washington, D.C., says NAFTA won't offer the Sprint workers much legal protection -- even if the hearings prove them right.

"Under the side agreement, the potential remedy of trade sanctions doesn't apply to industrial relations," Levinson told Telephony. "You can only invoke sanctions for violations of child labor laws, minimum wage laws, and health and safety provisions. So even if the Mexicans found that the U.S. had failed to enforce its own laws in the Sprint case, there is no effective remedy. This reveals how hollow the side agreements really are."

He adds, however, that under the National Labor Relations Act, "They can order that an election be held and the workers reinstated if they find that the shutting of the company was a dodge to avoid organization. The problem is making the finding that the claim of bankruptcy was bogus, and I think that's going to be very difficult."

For its part, Sprint claims it's not worried.

"The only thing we can do is focus on the debate," says White. "It's our belief that labor laws have been followed and enforced by the U.S. Department of Labor." He adds that of the 235 workers laid off when La Conexión Familiar closed down, 150 took part in Sprint-sponsored outplacement services -- and 135 have since found other jobs.

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