A BIT OF HISTORY.  In the 1920s, the Gaseosas Sin Rival bottle factory was opened in Tuxtla Gutierrez founded by Mr. Camilo Espinosa, giving rise to the Sin Rival soda pop.  The dividing up of the soda pops was done in bags.  There were no real routes rather the territory was divided in directions and distributors.  Those who came in the morning to take the empty bottles from the market and return in the afternoon with a new product were called, “Rumberos (from the Spanish “rumbos” meaning directions).  This gave rise to informal advance sales.  In the year, 1948, the Zavaleta Torres brothers bought the business and they modified its social function.  In 1952, the Sin Rival bottle company began to produce Coca-Cola in 6 ½ ounce servings, only.  Herein began the bottling of Coca-Cola in Chiapas.  In 1966 the Zavaleta brothers sold the company to the Dalton and Campbell Group.  Later, in 1980, the bottle company was acquired by Visa Group, which later converted it into Coca-Cola FEMSA.  That’s what it was until 1984 when the Coca-Cola company substituted Sin Rival for Fanta.

In 1994 the plant in the state capital, Tuxtla Gutierrez, closed due to lack of water and its increasing hardness (its lime content).  Finally, only the plant in San Cristobal de las Casas remained and it existed until 1994, the year in which it was remodelled and adapted to cover the demands of the locality’s market.  It’s the same year of the Zapatista uprising and it was the only transportation that could enter the region during the armed conflict.  The Sin Rival bottling name was on the label until April 1^st, 2000 when it changed its name to Inmuebles del Golfo S.A. de C.V..  In 2000, FEMSA bought the Tacana bottling plant in the city of Tapachula and closed it in the same year leaving all of the manufacturer’s employees without work and consolidating its state monopoly.  The plant was small and it was necessary to invest a lot of money to increase production volume (for example, it was necessary to build a plant for residual water at a cost of $ 1 000 000) making it cheaper to ship the product to the brother plants in San Cristobal, Villahermosa, Juchitan and Oaxaca. 

It appears that what most matters to FEMSA was the sales territory.  Up to the year 2002, it had only one production line for the Coca-Cola bottler and flavours were available in glass or returnable plastic.  In May 2002, a second production line started up specializing in non-returnable plastic containers and increasing its consumption of water.  In 2004 it was announced that investors from Oaxaca were  to install the Refrescos Gugar bottling company with an investment of sixty-five million pesos in the coastal municipality of Arriaga.  It would provide 150 direct jobs and 450 indirect jobs.  With the access to water, the highways and the ease of business investment that Governor Pablo Salazar authorized, it was also announced that an Omnilife plant – a company that makes baby food supplements – would set up in the same municipality. 

In Chiapas, 60% of the soda pop market is controlled by Coca-Cola, 30% by Pepsi and around 5% by Big Cola (though in the state of Puebla its closer to 20%) and 5% other sodas.  Presently, Pepsi Cola has a bottling plant in Tuxtla Gutierrez called the Central Chiapaneca bottling company.

UNFAIR COMPETITION

Many stores were obliged to sell Coca-Cola exclusively.  In indigenous communities it is no less worse.  In one indigenous community in the highlands of Chiapas, a family decided to start a boycott against Coca-Cola.  They asked the Big Cola company to supply their drink to the store.  When the Coca-Cola delivery truck arrived the driver offered two Coca-Colas in exchange for one Big Cola.  In another store the Coca-Cola delivery driver told the owner that Big Cola was owned by Coca-Cola and that it was what came out as low quality and that he’d take it back in exchange for more bottles of Coca-Cola.  Business and profit don’t respect any principles even when written.  For example, the Ethics Code of Coca-Cola FEMSA (CEF) states that:  “False comparisons and deceit with products or equivalent services offered by the competition should be avoided.”  Another articles stipulates that: “FEMSA will not participate in any deal that attempts to limit the free movements of the market forces in which it operates and it will not use inappropriate measures to improve its competitive position in said markets.”  It states that, “The advisors, directives and employees of FEMSA should avoid whenever possible making comments or declarations regarding the competition and, when necessary, these statements should be fair, objective and complete.”

THE PUBLIC OFFENSIVE.

The transnational has used huge public advertisements of smiling indigenous girls with a Coca-Cola.  In early 2004, Coca-Cola FEMSA launched some new catch phrases in its publicity.  One saying goes like this: “You’re not ugly, you have personality.  Drink Coca-Cola”.  This advertisement, in addition to being insulting has nothing to do with the CEF which states that, “Communication through publicity and merchandising of FEMSA goods should be: a) legal, decent, honest, truthful and it should conform to the principles of fair competition and good business practice; b) prepared with a fitting sense of social responsibility and based on the principles of honour and good faith; c) verifiable and free of elements that could induce an erroneous interpretation of the products and services that FEMSA offers; d) respectful of moral values, avoiding unethical circumstances that make human integrity and dignity vulnerable and the use of culturally offensive symbols with respect to sex, race, religion, social class or political preference.”

COCA-COLA AND THE MUNICIPALITY.

But the transnational’s businesses are not carried out alone.  They require working with local authorities.  In San Cristobal de las Casas, it is common to hear people say that the company “donated” a new Jeep model to the past municipal mayor.  True or not, the testimony of one worker was that, “On one occasion we invited the municipal president of San Cristobal de las Casas, Mariano Diaz, and his family to visit the plant where they gave them many souvenirs and guided tours in order to get his support for expanding the plant.”  A little bit later, the company was allowed to  build a second well in order to increase production and water use.  With respect to the CEF,  it says: “Supervisors, managers and employees that deal with authorities should treat them nicely and respectfully, recognizing their quality as such and creating an atmosphere of openness and trust to facilitate discussion of issues and establishing agreements.”  Immediately following it also says: “All dealings, documents and relations between the company and government officials should be carried out in accordance with applicable laws and with ordinary business practices by the companies within the industry in the country and the respective region.”

WORKER SECURITY.

One testimony confirmed that, “There was an ammonia leak in the mixer equipment (where the final drink is mixed with carbon dioxide and water at low temperatures) in line 2 while there was production in line 1.  The boss for line 2 ordered that the alarm be activated and personnel was evacuated to a safe location until the leak was controlled 30 minutes later.    Later, the line boss told us that he had been scolded for holding up line 1 since one hour of production was lost.  What’s interesting is that the employees are always told that Coca-Cola FEMSA has four fundamental directives in strict order:  SECURITY, QUALITY, VOLUME AND COST.  But the truth is that the priority is exactly the opposite.  Moreover, the CEF decrees that “FEMSA recognizes as part of its social responsibility, the protection of the environment” and it will carry out the actions necessary to assure that, “Significant changes in the factories and the processes will be evaluated in advance to prevent adverse changes to the environment; effective procedures have been implemented to respond to possible emergencies in order to minimize the impact of unforeseeable incidents; air emissions, drainage discharges and the management and confinement of solid wastes do not cause unacceptable environmental impacts: and that, “Environmental accidents are prevented”.

Ammonia is an industrial cooler used to cool the drink and obtain better carbonation.  It is stored in its liquid state in a closed system and it circulates in the equipment used to mix the drink in order to lower the drink’s temperature.  Another ammonia leak happened in 2002 at the San Cristobal bottling plant when expansion work was underway.  It was necessary to expand the ammonia to the new production line and at the time of doing the new connections, the wrong valve opened causing the ammonia to leave the container.  The leak was in the area of the ammonia compressors and there were at least three maintenance people at the site that managed to get out on time with only slight poisoning.  Fire fighters arrived to the site to control the leak and finally the valve was turned off by a supplier who was visiting the plant at the time closed using improvised equipment because the automatic respirators made for the job didn’t work.  Testimonies from neighbouring areas state that they couldn’t escape the smell of ammonia that permeated their homes.  It’s true that 10 years ago there was a serious ammonia leak at the bottling company in the border city of Tapachula owing to a break in the pipes carrying the ammonia to the room in the factory.  As bad luck would have it, the ammonia spilled onto some workers killing two people.

Regarding this the CEF states: “Those in charge of the distinct business places should take measures to ensure that the following health and safety objectives are met:  a) Provide and maintain safe and healthy working places; b) Make available and maintain an adequate working environment; c) Develop safety awareness among the personnel.

Another witness affirmed that, “The brother of the plant manager always came to give us courses on internal audits and corrective actions, though there were other providers with more experience”.  In this regard the CEF states that, “The supervisors and employees cannot have interests in the businesses that buy, sell or provide services to FEMSA companies.  Whatever transaction with linked companies should be communicated to the Board’s Auditing Committee on Internal Audits.”

INTERNAL BUSINESSES

Article 9 of CEF maintains that, “No advisor, supervisor or employee can use the FEMSA name or that of its companies or any of its other resources for his/her personal benefit”  Nonetheless, one witness states that, “When I went to purchase food for courses or meetings, the plant manager ordered me to take some of the food to his house.”  Another said that, “On one occasion the plant manager brought me his son’s video game control to be fixed during working hours.”  In the following article, CEF concludes that: “Contact with dishonest people who try to or may prejudice the FEMSA company should be avoided.” 

Coca-Cola FEMSA demands that their worker have nothing more to do than attend to the company.  In its CEF, it is affirmed that, “Supervisors and employees should avoid having activities outside the company that demand a large part of their time and energy as this can affect their ability and availability with regards to the obligations that they have to the company.”  With another CEF article, the Colombian unionists and the families of those who have been assassinated in the Coca-Cola FEMSA bottling factories would die either laughing or with rage as it states that: “It is prohibited to fire, degrade, suspend, threaten, accuse, interfere with the right of the worker (…)”.

The CEF finds that, “Supervisors and employees that negotiate the acquisition of goods and services that the FEMSA company needs should offer and demand of the providers a fair and honest deal in each transaction, always looking out for the bests interests of the company.  Regardless, one worker states that, “I had found a provider that gave us some  washing machine parts at a low price as it was my job to look after the monthly budget assigned to me for the maintenance of equipment under my charge but the maintenance boss forced me to use  another provided who charge a lot more.”  In another CEF article it is determined that, “The acquisition of goods and services will be done through homogeneous and transparent processes that assure the equal participation  of the providers and impartial selection of the same based on the criteria of quality, cost and service.”  But again the reality is something else.  The testimony of one worker was, “I had to raise the price on the quotes for jobs that they asked of me because I had to pay a bribe to the person who takes the maintenance work orders, to the maintenance planning, to the maintenance boss and to the plant director, so that they’d prefer me for the job.”  Another said that: “The plant manager pressured me to invite him to some night club in exchange for facilitating the testing of other cleaning products”.

LABOUR RIGHTS.

The Coca-Cola FEMSA plant in San Cristobal has two managers, one for sales and the other for manufacturing.  There are also six heads:  Production, Quality Assurance, Maintenance and Engineering, Operations (distribution), Administration and Human Resources.  The workers are affiliated with CROM to which helpers, workers, salespeople and machine operators belong.  There are only about 10 women working at the bottling plant of who they require proof that they are not pregnant before employing them.  They are not exempt from sexual harassment.  Coca-Cola FEMSA’s Code of Ethics states that, “Advisors, managers and employees of FEMSA should follow loyal, respectful, diligent and honest conduct.”  Later on its states that, “sexual harassment is prohibited, condemned and it should be denounced due to the moral damage that it causes.”  Regarding this, one female ex-employee of the plant said that, “I worked as a secretary and since I didn’t accept the plant manager’s invitations to go out he had me working late into the night”.  Another said, “Sure there’s sexual harassment at the plant!”  In conjunction with the Monterrey Institute of Technology, the Chiapas Coca-Cola FEMSA plant, similar to the Cuahtemoc Brewery, implemented the High Performance System (HPS) at the end of 2003 which is defined as that which can: Respond to the demands of the market in reasonable time; provide a product that is superior to that of the competition; obtain customer and employee satisfaction and get reasonable profits.  At the San Cristobal bottling plant, the idea was put to the employees that HPS consisted of working in interdisciplinary teams to solve the problems of the plant.  This implied the commitment of each worker to integrate into the new activities set out by the HPS, from training to taking on new work loads to having carried out 100% of the new activities according to the following HPS objectives: “Accomplish the active participation of personnel in working teams, modulating basic structure and development of their team through the effective application of the formats of diverse types of working teams (supervisory and managing, inter-functional, quality teams, project working teams, etc.).”

Therefore, the demanded that their workers commit to carrying out all of the new responsibilities in the time and manner that the company dictated.  The leaders referred to the HPS project as a fast-moving truck that you had to either get on or be run over by leaving you outside the company.  Using this system, they asked their available workers to participate in training in the new work roles and to practice the newly assigned activities.  For example, a machine operator had to have training in mechanical maintenance, electricity and basic electronics as well as quality analysis of machinery products and administrative work such as lost time, efficiency, failures, etc..  Obviously, the company demanded their free time, that they be efficient in the new activities and, if they were reliable, in addition to the previous works, they had to train the workers in the daily activities.

The company convinced the workers that the implementation of the HPS would benefit all through the company’s continued existence; the acquisition of new knowledge for all personnel; that everyone was going to make their own decisions in relation to their daily activities, and; that there would be bonuses for productivity and 5% salary increases exclusively for unionized workers.  What they didn’t tell the workers is that the training for the new activities would be almost daily for approximately 4 months and outside the workers’ normal shift.  That is to say, that the night workers were scheduled for courses for four hours in the mornings or afternoons.  They didn’t pay for even one extra hour for training or practicing the new activities that were done during hours outside their normal work term.  Hence, the workload of each worker tripled or quadrupled but their salary didn’t.  And then they began to lay off middle management and unionized people.  The work that the right-hand workers did is now done by unionized workers.

The right-hand workers worked an average of 10 hours a day.  Added to this, they had to return to the plant outside working hours to look after problems with the equipment, for meetings or for training though these hours were not paid for.  When one such worker covered for the vacation of a peer, the worker was only paid for half the extra hours worked or s/he wasn’t paid at all.  Obviously in the TOPS System Manual of Coca-Cola FEMSA, it says that, “Some of the causes of workplace conflict (are):  Not fulfilling the established rules” and “Lack of Cooperation”.  So, taking it to the level of the personnel, the long-time workers that remained had their workloads increased.  Workers who worked overtime to cover another person’s vacation were no longer paid for the extra hours.  The managers said that it was to help the company generate more savings, respond to FEMSA’s excessive debt for having bought the Panamco company that made FEMSA into Coca-Cola’s larger bottling company in Latin America and the Caribbean.  Thus, since the HPS began, it has fired at least 25 people, most of them long-time workers with more than 23 years of service or who had high salaries or due to having their job eliminated adding the tasks to the workloads of other workers or because the worker complained.  

All workers have signed a privacy contract.  This contract signed by all workers has many clauses that mention that with working for Coca-Cola FEMSA and even after having left the company, the employee is prohibited from revealing information about the processes, technology, procedures, recipes, productions, etc..  It also mentions that any research, advance or improvement made by a worker while the contract applies is the property of Coca-Cola FEMSA.  Regarding this, FEMSA’s Ethics Code says that: “Advisors, managers and employees should abstain from making comments even in family or social environments regarding the activities carried out at the company that would be to its detriment or about the other advisors, managers or employees.”  Another articles states: “(…) one should abstain from divulging confidential information relating to the processes, methods, strategies, plans, projects, technical data, marketing or any other kind of information.”

The testimony of one worker is that, “One guy that worked at Quimiproductos in San Cristobal was fired because he had an epileptic attack at the Coca-Cola plant.”  Regarding this the CEF states that, “Nobody will be discriminated against for reasons relating to sex, civil status, age, religion, race, physical capacity, political leanings or social class”.  There are even sanctions for, “Discriminating, intimidating or harassing another person about their race, colour, sex, age, origin, beliefs, sexual preference or physical ability.”  At another point in the CEF it says that, “Those who have in their charge persons who report to them have a moral obligation to respect and protect them as relevant”, however another testimony affirms that, “My immediate boss and the department boss didn’t help me when the plant manager demanded my resignation in an indignant, authoritative and aggressive manner”.

THE CASE OF TABASCO.

A few years ago, a group of “golpeadores” (people who would beat up others) were contracted by the union managers of CROC to attack a group of workers pushing for the employees to affiliate themselves with the Benito Juarez National Unino that had gathered in front of the Coca-Cola FEMSA plant in the Mexican state of Tabasco.  The leaders were in front of the transnational’s building to talk at the end of the workday with other workers that disapproved of the corruption of the state CROC leader.  Being in favour of this aggression, Coca-Cola’s Human Resources Manager, Hector Mendoza, took advantage of the moment to, as soon as the quarrel began, order that locks be put on the entrance to the building and so no workers were allowed to leave until very late in the afternoon.  Days later, the intimidation continued inside and outside the plant.  On the day of the union vote, the first attack against it began.  The custodians impeded the access of the workers into the plant and the golpeadores attacked them in the street resulting in more than 40 wounded.  They even attacked the homes of some workers.  Inside the plant there were also golpeadores in cahoots  with Coca-Cola’s officials.  A few days later, hundreds of people blocked the highway leading to the plant for a few hours.  They demanded that the governor call on Coca-Cola to compensate them for damages to their homes and, moreover, that the fired workers be returned to work and in this way, restoring the right of state and the respect for human rights.

In the security policies of Coca-Cola FEMSA, it is stated that, “we are committed to continually improving working conditions, maintaining a healthy and safe work environment, providing and ensuring the physical integrity of the workers, installations and equipment through training in the prevention of workplace risks.  To this same end, we are committed to establishing and applying programs of industrial hygiene and the prevention of illnesses and the fulfilling of legal requirements for safety and environmental protection”. (Coca-Cola FEMSA, “El Huitepec”, monthly bulletin, San Cristobal Plant, Year 1. Number 5, May 2003). Could it be true?

Sources and for more information: Coca-Cola FEMSA www.cocacola-FEMSA.com.mx; the magazine, “Juntos, Talento y Compromiso” Nos. 2 and 6, July 2000 and June 2001 respectively, Coca-Cola FEMSA; Coca-Cola Femsa, “El Huitepec”, monthly bulletin, San Cristóbal plant, Year 1.Number 5, May 2003; Equipo Nizkor nizkor@teleline.es

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