VW Mexico union to hold new contract vote after workers reject pay deal

MEXICO CITY -- Workers at Volkswagen Group's main Mexico factory will be asked to vote again on whether to approve their union's deal with management for a 9 percent pay increase after initially rejecting the agreement, the union said.

The Puebla plant builds the Jetta, Taos and Tiguan models.

The factory's Independent Union of Automotive Workers reached a deal with the company for what would have been the biggest automaker raise in Mexico in recent years, covering about 7,000 people in the central state of Puebla, but the plan failed to pass a worker's vote needed for approval.

The Independent Union initially sought a raise above 15 percent, citing inflation.

Last year, it negotiated a 5.5 percent increase with VW and in July settled on a 9 percent hike for the next year-long pay cycle.

Union salaries at the Puebla plant range from about $15 to $48 a day.

Mexico's Federal Center for Labor Conciliation and Registration said it instructed the union to redo the vote to ensure higher turnout.

In the initial vote on Aug. 5, about 70 percent of eligible workers cast ballots, the Federal Center said. The "no" votes pulled ahead by 338 ballots.

The union said in a statement it has yet to set a date for the new vote but will repeat the entire process, including distributing the recently negotiated contract for the Puebla plant.

VW said it hoped the new vote would represent all unionized workers. The company last week said it was committed to "constructive dialogue" with the union after the rejection.