MEXICAN Labour Laws

7/29/2019 MEXICAN Labour Laws

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LABOUR

LAWSIN

MEXICO


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Labor matters in the entire Mexican Republic are regulated by the Federal Labor

Law( FLL) which has been in effect since 1970.

For all legal effects, a labor relation exists when a physical person renders a personal

service under the authority of another person or entity, in return for a salary.

Mexico, officially the United Mexican States is a federal constitutional republic

in North America.

Labor Contracts

There are two types of employment contracts:

One is collective (the same for several people) in which the clauses are

determined between the employer and the labor union.

The other is an individual contract, where the individual negotiates his/her

own employment contract.

INTRODUCTION


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PRESUMPTION OF PERMANENT EMPLOYMENT

An employee who works at least for a month for an employer ispresumed to be a permanent employee.

For the first month of employment, if a contract is prepared

describing the temporary nature of an employees work, the employer

may terminate the contract within the month without cause.

After that month, an employee may only be separated for justified

cause without the employer owing severance.

FLL does not allow at-will employment under which employers may

discharge employees at any time and for any reason, or no reason, aslong as there is no breach of contract or violation of statute or public

policy.


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DISCHARGE AND SEVERANCE

There is ample protection provided to labor in Mexico.

Employers are not permitted to dismiss employees without just cause. If they do so, theemployee has a right to file suit for re-instatement or indemnification in the labor courts.

The burden of proof is on the employer to show that the discharge was legal.

The labor relationship may terminate by: Mutual agreement (employer/employee) (employees can not be obligated to work at

a specific job for more than one year, however they may continue if they wish).

By death of the employee.

By completion of the job performed or by expiration of the time for which theemployee was hired.

By mental or physical incapacitation of the employee or illness or injury that is not

considered a work-related risk


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JUSTIFIED CAUSES FOR DISCHRAGE OF EMPLOYEES

Deceit or fraud by the employee with his fellow workers.

Misconduct, threats or injuries by the employee.

Bad conduct by the employee with his follow workers, which causes a brake in thediscipline.

Bad conduct by the employee outside the work place which effects the employer, the

administrative personnel or their families.

Intentional damages or prejudice to the employer or his assets while working.

Grave damage or prejudice to the employer caused by the employee due to his

unintentional negligence.

Immoral acts at the place of business by the employee.

Revealing trade secrets of the employer.

Having more than 3 absences from work within 30 days, without justification or the

employer's permission.

Refusal by the employee to adopt preventive measures to avoid accidents or illness.

Drunkenness or drinking of intoxicants at the place of work, save by medical

prescription and notification thereof to the employer.

Imprisonment of the employee.

Employee does not have work-related licenses or certificates.


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But if the case is resolved in favor of the employee, i.e. it is proved that the dismissal

was done without a justified cause he/she has the right to reinstatement plus to receive

all back wages that were incurred while the court process was going on.

If the employee decides not to seek reinstatement, then he may receive three monthssalary, all back wages, plus other items that were owed him/her prior to the dismissal

(such as unpaid vacations, year end bonuses, profit sharing, seniority pay, maturity

leave, and others).

The employer may chose not to reinstate the employee for unjustified dismissal when:

The employee has been working for an employer for less than a year.

The employee and employer are constantly in direct contact and the board of conciliation

and arbitration deems that the two cannot work together.

When the employee was an "of confidence" employee (entrusted with confidential

administrative or management type activities), when the employee was arrested.

The employee was working as an occasional worker.


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The new 2012 labor reform states $7 MXN an hour. Daily minimum wages that are

set annually by law are determined by zone:

62.33 Mexican pesos ($4.60) in Zone A (Baja California, Federal District, State of

Mexico and large cities)

60.57 pesos in Zone B (Sonora, Nuevo Len, Tamaulipas, Veracruz, and Jalisco)

59.08 pesos in Zone C (all other states)

The minimum wage increase in 2011 was 4.1%

Mexico's minimum wage commission set the increase for 2012 at 4.2% for all three of

the country's geographic zones and it is above the expected rate of inflation for 2012 ,

which the Bank of Mexico estimated to be between 3% and 4%.

An employee is entitled to receive at least, the minimum salary, which officially is fixed on ayearly basis.

MINIMUM WAGES


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WORKING CONDITIONS AND FRINGE BENEFITS

WORKING HOURS: The maximum duration of the working hours is eight hours for

the day shift, seven hours for the night and seven and a half hours for the mixed shift.

DAYS OF REST: For every six days of work, an employee has the right to enjoy

one paid day of rest. In case employee renders services on Sundays, he is entitled toan extra bonus equivalent to 25% of that dayspay.

THE WORK WEEK: The FLL of Mexico sets forth a maximum of 48 hours per week

as the amount of hours a laborer can work without going overtime. Even so, most

companies only run the work week at 40 to 45 hours.

Nevertheless, it is possible that the working hours be distributed, within a working

week, in order to allow the worker to enjoy more than one day of rest.

For example, in day shifts the weekly working hours, that is 48, may be scheduled

within five days in order to allow the employee to enjoy one extra day of rest.

OVERTIME: In this case the hourly wage can be double or even triple the normal

hourly wage, depending on how many hours overtime the employee is working.

In the event that the overtime is on a holiday, the hours are paid at triple the normal

hourly wage.


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CHRISTMAS BONUS: Employees have the right to receive an amount equivalent to 15days pay as a Christmas bonus before the 20th of December of each year.

REQUIRED PAID VACATION: Employees are entitled to the following paid

vacation, in addition to a 25% vacation premium:

Six days of paid vacation after one year of work.

An additional two days annually every added year of service until the end of the

employees fourth year .

Two days of paid vacation every additional five years of work.

HOLIDAYS: The official holidays in Mexico are: January 1 ( New Year's Day ), February 5

( Constitutional Day ) , March 21 ( Juarez's Birthday ) , May 1 ( Labor Day ) , September 16

( Independence Day ) , November 20 ( Revolution Day ) , December 25 ( Christmas Day )

plus the first of December of every six years, when a new President of Mexico takes office.

SPECIAL BONUSES: Employees who work in areas that have high employment rates

are entitled to bonuses based on factors such as work habits (punctuality) and company

productivity.


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COMPANY PROFITS: After their first year of operations, Mexican employers are

required to pay approximately 10% of their net annual income among all employees.

SOCIAL SECURITY:

The Mexican Federal Social Security system is funded by a mandatory charge paid by

the employer, calculated on the salary paid to the employees. This money is to create

hospitals and staff them , in order to provide full medical coverage to the employees.

The employers also pay for the Living Quarters Fund (INFONAVIT) ,an amountequivalent to 5% of the employees salaries

The Retirement Savings System (SAR):The employer is to periodically deposit in a

banking account, for the employee, a sum equivalent to 2% of his/her salary, as a

savings account for the employees' retirement .

In addition there are payments for vacations, vacation premiums, and year end

bonuses. \


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CHILD LABOR LAWS

The FLL sets special standards for children who work in Mexico. The purpose of these

standards is to ensure childrens safety, welfare and access to education.

The Mexican Constitution allows boys and girls aged 14 to work but in such cases theymust:

Have finished secondary school. If not, then they need permission from the labor

inspector.

Obtain a medical certificate stating that they can work. Without a medical certificate,

no employer can hire them.

Have written permission from their parents or guardian.

Among these various provisions, minors are prevented from work that is

dangerous or unhealthy, underground or underwater, itinerant, or which may

affect their morals or good behavior.

In addition, they may not work after 10:00 p.m. in an industrial plant, work for

more than six hours per day, or work for more than three hours without a one

hour break.


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MATERNITY LEAVE LAW

Mothers are not covered by a state maternity leave law. Instead, both mothers andfathers are provided with leave under the Family Medical Leave Act of 1993(FMLA).

According to FMLA, they have a right to 12 weeks of unpaid leave yearly. They mustqualify by working a certain number of hours in the past 52 weeks at a certain wagelevel. They must also be working for a business with 50 or more workers.

Circumstances under which employees are eligible to take FMLA leave:

For birth of the employees child, and to care for the newborn child

To look after a adopted child or for foster care

To care for the employee's spouse, son, daughter, or parent with a serious healthcondition

For a qualifying need arising out of the fact that the employees spouse, son, daughter,or parent is a covered military member on active duty.

To care for a covered service member who became ill or was injured as a result ofactive duty service.


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COLLECTIVE WORKING RELATIONS:

UNIONS: Unions may be organized both for employers and for employees, but the most

common situation is that of an employee union.

It is not compulsory to have a union within a company, but that situation may be forced

upon a company whenever the majority of employees so request.

When this happens a union contract is entered whereby the working conditions and

workers fringebenefits are regulated for a given company or establishment.

STRIKES: A labor union whose members are employed by a company, may file a

petition to strike, and consequently, any and all activities of the company may be

suspended until the conflict is resolved.

A petition to strike is filed before the Labor Board, and shall be notified to the employerat least 6 days prior to the suspension of activities.

A strike needs to have any of the objectives stated in article 450 of the FLL.


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THANK YOU!!!

MEXICAN Labour Laws

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