Mexico president moves against outsourcing, blasts Starbucks operator over layoffs

MEXICO CITY (Reuters) - Mexico's president said he would send Congress a proposal on Thursday to make it harder for companies to outsource employees, rebuked local Starbucks operator Alsea for firing workers, and stirred new tensions with business leaders.

Reuters November 13, 2020 01:10:41 IST
Mexico president moves against outsourcing, blasts Starbucks operator over layoffs

Mexico president moves against outsourcing blasts Starbucks operator over layoffs

MEXICO CITY (Reuters) - Mexico's president said he would send Congress a proposal on Thursday to make it harder for companies to outsource employees, rebuked local Starbucks operator Alsea for firing workers, and stirred new tensions with business leaders.

Speaking alongside President Andres Manuel Lopez Obrador at a news conference, Labor Minister Luisa Maria Alcalde said the outsourcing reforms aimed to protect workers' rights, including their earnings and pensions.

Lopez Obrador, a leftist, has vowed to improve the rights of workers, and has pressed his officials to go after companies that are not compliant with their tax obligations.

Mexico is also under pressure to strengthen its labor laws under the terms of the United States-Mexico-Canada Agreement (USMCA), a new trade accord that replaced the 1994 North American Free Trade Agreement (NAFTA) beginning in July.

The outsourcing announcement quickly sparked pushback from some of Mexico's top business leaders.

"The initiative... betrays the commitment to build legal change based on consensus with the private sector," Gustavo de Hoyos, president of Coparmex, one of Mexico's top business associations, said on Twitter.

Lopez Obrador also reproached large companies for laying off workers during the coronavirus pandemic, singling out restaurant operator Alsea, which operates Starbucks cafes across Mexico and other markets.

"Starbucks workers started to complain that they were laying off everyone, without giving them a single benefit," he said, without providing details on the workers' claims.

Alsea said it was preparing a statement in response to the president's comments.

(Reporting by Ana Isabel Martinez, Daina Beth Solomon and Raul Cortes, writing by Laura Gottesdiener; Editing by Bernadette Baum)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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