Innovate in Mexico towards fair access to justice for low-income workers

In Mexico, the judicial system suffers from a lack of transparency and fairness that is detrimental to the poorest, who do not have the economic or social capital necessary to assert their rights. Two-thirds of dismissed workers in Mexico do not receive the severance pay owed to them by their employers, and less than 10% of them seek justice through the courts (Castellanos and al, 2020). Low-income informal workers are the most impacted by the problem, and the most affected by low quality legal representation.

Led by the Instituto Tecnológico Autónomo de México (ITAM), in partnership with Mexico City Labor Court for the implementation, and based on studies of thousands of casefiles in the Mexico City Labor Court in the last 5 years, the proposed solution aims at making access to justice cheaper, more transparent, and less prone to corruption. The goal is to address issues of adverse selection and moral hazard in the market for legal services through digital solutions.

The innovation relies on four components:

• An online suing solution, communicating with the Court system, to allow better-quality matches between workers seeking justice and lawyers;
• A two-sided lawyer information bureau that makes past performance and client ratings available to potential clients, giving incentives to lawyers to build a good reputation;
• An online case-tracking system that will be integrated with the Court’s records system, providing real-time information about the progress of a case;
• **An app **and a system to assign cases bureaucrats of the Labor Court on a rotating basis, relying on an agreement with labor tribunal in Mexico City, in order to reduce their opportunities to engage in corruption.

FID’s funding will allow developing an improved version of the existing app and the system with the stakeholders. ITAM will also conduct a randomized controlled evaluation (RCT) in order to measure causal effects and generate evidence of impact.

The proposed innovation aims to achieve specific impact on the four components:

• help workers find better lawyers,
• monitor lawyers’ present performance,
• create a platform that incentivizes lawyers to perform better,
• provide bureaucrats with technology that makes their job easier while also reducing their opportunities to engage in corruption.

The app is expected to affect over 100,000 current cases on the Mexico City Labor Court.

The impact evaluation will allow to measure causal effects between the solution and the outcomes expected. This generated evidence will be used in order to persuade the Mexico City Labor Court to adopt and scale the solution. If successful, this project may have positive spillovers to other states that could adopt it.