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Wage theft in Mexico: The cost of an unpaid lunch break

June 3, 2014

“Three years ago, we had hopes that Levi’s would help win justice for these workers, but now those hopes are gone.”  -Sara Montes, Colectivo Raiz

The cost of an unpaid lunch break may not seem like much, but when you add up the lost income over a number of years, it represents a significant amount of money, particularly for a low-paid Mexican maquila worker.

Workers at the Jobar jean factory in Aguascalientes, Mexico are well aware of how much income they have lost because of their employer's failure to comply with Mexican labour law.

The average amount owing each worker per year is US$207. Many of the workers have been employed by Jobar for 10 years, which means they are entitled to over US$2,000 in back pay. For 2013 alone, Jobar owes its 893 workers a total of approximately US$185,000.

This story of wage theft becomes even more disturbing given that the major buyer from the factory is Levi's Strauss, a company that prides itself as being socially responsible, and that Levi's has known about the situation since 2009.

In that year, Colectivo Raiz (CR), a Mexican labour rights organization based in Aguascalientes, wrote to Levi's Vice-President of Sustainability, Michael Kobori, detailing a number of worker rights violations at Jobar, including failure to pay workers for their lunch breaks.

After a lengthy negotiation process, involving Levi's, Colectivo Raiz, and MSN, Levi's agreed to contract the monitoring organization Verité to undertake a third-party investigation.

Among the worker rights violations identified by Verité were:
• Jobar signing a collective agreement, as well as other agreements that diminished workers' entitlements, with a "protection union" without the workers' knowledge or consent;
• Failing to provide clearly understandable pay slips, making it impossible for workers to verify whether they were being paid properly; and
• Failing to pay workers for their lunch breaks, which resulted in them losing 2.5 hours overtime pay a week.

Following the release of the Verité report, Levi's required Jobar to distribute copies of the collective bargaining agreement (CBA) to the workers, which was done in March 2011. However, it appears that workers have not received copies of their updated CBAs, or copies of other agreements signed between the company and its protection union.

While not disputing Verité's finding that Jobar's protection union is not an authentic representative of the workers, Levi's did dispute its finding that workers were being denied their lawful right to be paid for their half hour lunch break. It did however agree to ensure that workers' pay slips clearly indicate how their weekly pay was calculated - something that still has not been done.

To resolve the lunch-break issue, Levi's, MSN and Colectivo Raiz agreed to contract a Mexican labour rights expert to provide an independent legal opinion of whether workers in Mexico were legally entitled to be paid for their lunch breaks. The expert's October 2011 report confirmed that they were, noting that because Jobar workers were required to work a 50.5 hour workweek, they should have been paid for 2.5 hours overtime a week.

In January 2012, Levi's informed MSN that the company would accept the legal opinion and on May 17 reported that Jobar had agreed to pay workers for their lunch breaks beginning immediately. Levi's was unwilling to require Jobar to provide back pay for overtime hours previously worked.

However, when the workers received their next pay slips, Colectivo Raiz was able to verify that workers' total pay remained unchanged.

Two and a half years later, after much correspondence and many staff changes at Levi's, in May 2014 Levi's informed MSN and Colectivo Raiz that rather than paying the workers what they are owed, Jobar would be extending the lunch break by another 31 minutes, thereby creating a break in employment and, in Levi's opinion, complying with Mexican legal requirements.

In other words, the workers would not only continue to be denied their lawful right to be paid for their lunch break, but would have to stay at the factory 31 minutes longer each day for no extra pay.

In fact, any change in the terms of employment requires workers' consent. MSN and Colectivo Raiz can only assume that the protection union "representing" Jobar workers has signed off on this wage-theft agreement without the workers' knowledge or consent.

Colectivo Raiz and MSN will continue to demand that Levi's require its supplier to provide back pay owing to workers and follow through on its stated commitment to ensure that Jobar pays workers for their lunch break and provides them with clearly understandable pay slips.

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