Panama Canal Expansion Stalls After Labor Walkout

Construction of the third set of locks at the Panama Canal ground to a halt Monday when thousands of workers stopped work to demand payment of back wages and better working conditions, according to a published report.

“Work is completely paralyzed, on the Pacific and the Atlantic side," Saul Mendez, head of the National Union of Workers in Construction and Allied Industries, the largest in the country, told Agence France Press.

The largest element of the expansion project is the $3.2 billion construction of the locks by the United Group, a consortium of Spain's Sacyr, Italy's Impregilo, Belgium's Jan de Nul and Panama's Constructora Urbana. The union is demanding that the consortium pay back wages as well as raise the minimum wage of thousands of workers on the site, according to Mendez, who also accused foreign foremen of abusing Panamanian workers, according to AFP.

Workers staged protests throughout the day that included burning tires. The United Group denied the allegations, saying in a statement that it "fully complies with the pay and working conditions" agreed upon with the workers and that it is "very respectful of Panamanian regulations."

It added, however, that there had been "errors in the incorporation of data" on the part of a local contractor that distributes wages and said the consortium is working on fixing the problems.
The consortium said it pays the minimum legal wage of $2.90 per hour for canal workers, which is higher than in the rest of the country.

The expansion work to double the canal's capacity by late 2014 has been slowed by labor disputes in the past, including in November 2010, when work was paralyzed for several days.

-- Contact Peter T. Leach at pleach@joc.com. Follow him on Twitter @petertleach.