Mexico Employment Laws

Legal labor unions emerged from the political turmoil of the Mexican Revolution of 1910. These new organizations were instrumental in enacting the first labor laws guaranteeing basic rights to Mexican workers. The Federal Labor Law in its current form, as of 1970, established additional rights to vacation pay, health care and an eight-hour work day. As an employer in Mexico, you must be aware of the law and comply with all its requirements.
  1. Work Hours

    • The normal work week in Mexico consists of six days of work, eight hours a day, totaling 48 hours actually worked during the week. The seventh day of the week, usually Sunday, is a paid day of rest. Generally, employees are paid by week, but hours actually worked are still calculated to determine if overtime is due. The maximum hours employees can work in a single day depends on whether they're on day shift (eight hours), night shift (seven hours) or mixed shift (7 ½ hours). Employees working longer shifts, must be paid overtime.

    Overtime and Holidays

    • Overtime, or anything greater than a seven- to eight-hour day or a 48-hour week, is limited to nine hours a week or three hours a day, paid at double time. Employees who work over this limit must be paid triple time. Mexico also has seven mandatory paid holidays: Jan.1 (New Year's Day), Feb. 5 (Constitutional Day), Mar. 21 (Juarez's Birthday), May 1 (Labor Day), Sept.16 (Independence Day) , Nov.20 (Revolution Day), Dec. 25 (Christmas Day). Employee contracts include two additional paid holidays. Every six years, Dec. 1, or Inauguration Day, is a paid federal holiday.

    Salary Requirements

    • Mexican minimum wage is dictated by region. This places Zone A, or Mexico city and outlying areas, at 57.46 pesos a day, and Zone B, which includes Monterrey and Guadalajara, at 55.84 pesos. The wage for Zone C, which is paid in the smaller cities, rose to 54.47 pesos from 51.95 pesos. Most wages are determined at multiples of the minimum wage, so the yearly increases affects all salaries.

    Vacation and Maternity Leave

    • Employees are entitled to no less than six days of vacation a year. After the first year of employment, vacation time increases by two days every year until it reaches 12 days. At this point, employees get two additional days for every five years of employment and a 25 percent minimum vacation bonus. This is on top of the Christmas bonus, equal to at least 15 days wages, to be paid by Dec. 20. Female employees are entitled to 12 weeks of paid maternity leave, six weeks prior to delivery and six weeks after. On returning to work, they're entitled to their former position and any missed holiday pay.

    Termination

    • An employer has the right to fire any employee for the following reasons: theft, violence, using inappropriate language, use of drugs or alcohol or excessive absenteeism. If an employer chooses to fire an employee for reasons other than those listed above, the law is on the side of the employee, not employer. If the Board of Conciliation finds in favor of the employee, the employer is responsible for paying the employee three months salary, besides 20 days for each year the employee worked for the employer.

      An employer and employee can mutually dissolve a contract. When employees quit a job voluntarily, their employers must pay the remainder of their vacation and bonus on a pro-rated basis. If employees have been employed for longer than 15 years, the employer must pay a leaving bonus equivalent to 12 days salary.

    IMSS, Retirement and Income Taxes

    • Employers must register their employees with the Mexican Institute of Social Security (IMSS). Employers who fail to do this are liable for their employees' care and back Social Security. Employers withhold 5.25 percent of employees' salary, then submit that with their contribution to the IMSS. If employees earn the minimum wage, employers must pay the full 17.7 percent Social Security contribution. Besides Social Security, employers must deposit two percent of their employees' salary in a bank account for retirement and pay three percent of their salaries to the Federal Workers Housing Fund. Employers withhold income taxes from all employees making over the minimum wage and pay them to the government every month.

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