Labor law in Mexico: An Overview

Last Updated on February 7, 2023

Labor law in Mexico consists of a set of legal rules that establish the relationship between employee and employer. This is reaffirmed with an employment contract. In this agreement, the contract will specify the terms of employment set by the company. Details such as the length of the workday, rest days, salary, and vacations, among others, must be taken into account.

According to a study conducted by Mexico’s National Council for the Evaluation of Social Development Policy (CONEVAL), ninety-five out of a hundred Mexican citizens are unaware of their right to decent work under Mexican labor law. These figures are surprising and demonstrate workers’ and employers’ lack of knowledge of the country’s Labor Law. Therefore, this article will provide an overview of the subject.

In addition, the worker is obliged to provide a service, which can be intellectual, material, or both, to a person who will be called the employer. When we talk about labor law in Mexico, however, there are many implications that some employers may be unaware of.

For this reason, this article will explain what labor law is in Mexico and the details of the law that employers must consider when running their businesses.

What is labor law in Mexico?

Article 123 of the Mexican constitution states, “Every person has the right to decent and socially useful work; To this end, the creation of jobs and the social organization of work will be promoted, in accordance with the law.”

In other words, all Mexicans have the right by law to access a job in conditions that favor their growth and development. In addition, working conditions must be healthy and safe. Not maintaining such an environment signifies that the employer is breaking the law.

In the following sections, we will see what labor rights are that, as an employer, companies must ensure to their employees, provided that the former group complies with its obligations.

What are the fundamental labor rights in Mexico?

Next, we will examine the most relevant aspects of  Mexican labor law that the employment contract must reflect in an employment contract.

• Salary: This is the remuneration that employers must pay their employees for the activities carried out during the workday. The general minimum wages must be sufficient to satisfy the typical needs of a head of a family, materially, socially, and culturally, and to provide for the children’s compulsory education.
• Rest day: A mandatory rest day is one of the provisions of Mexican labor law.

When a company’s employees are obliged to work on rest days, they must pay double. For example, if a worker earns 141 pesos on a typical day when working on a rest day, the employee will be paid 282 pesos.

• Mandatory Bonus: The law has as a labor right in Mexico to pay bonuses to workers. It is a sum paid by the employer annually, corresponding to 15 days of salary.
• Vacations: All workers who complete a year working in a company will have the right to enjoy six days of paid leave. This period will be increased by two days by two days in subsequent years.
• Social Security: A company is legally responsible for taking care of a large part of the social security payments for its employees, in addition to providing them with safe working conditions. This is a human right contemplated by the Political Constitution of the United Mexican States and by the Universal Declaration of Human Rights.

What other labor rights must companies comply with regarding their employees?

• Duration of the working day: The duration of the complete working day will be eight hours. The night shift will be seven hours, and the mixed shift will be seven and a half hours. During the continuous working day, the company will grant a break of at least half an hour.
• Extra work hours. Overtime (according to the LFT) must be:

1. Must be accepted voluntarily.
2. Must be paid at double the regular rate.
3. Should not exceed three extra hours a day.
4. Employees must not work overtime more than three times a week.
5. If nine overtime hours are performed in a single week, the extra hours are paid triple.

• Profit sharing: All company workers have the right to participate in the company’s profits.
• Non-discrimination: The Federal Labor Law prohibits any type of discrimination. Regardless of race, nationality, sexual orientation, religion, marital status, age, gender, and disability. Employers must assert these conditions of respect from the beginning of the hiring process.
• Training: Companies will be obliged to provide their employees with basic training for their assigned tasks or training for work, allowing them to raise their standard of living.
• Pregnancy Leave: A woman’s pregnancy will not affect her salary, benefits, or any other workplace rights. Mexican Social Security (IMSS) will pay a mother to be one hundred percent of her salary as a contribution to her social security. In addition, expectant mothers will enjoy a break of six weeks before and six after the delivery of an infant. In the case of adoption, mothers will also enjoy a six-week break with pay.

Mexican labor laws

A set of regulations and statutes protect labor law in Mexico. The most important that govern working conditions and the relationship between worker and employer are:

• Political Constitution of the United Mexican States
• Federal Labor Law
• Social Security Law

Each of them presents vital aspects to understanding the labor rights of workers in Mexico. In addition to establishing the obligations of employers, they also point out the responsibilities with which workers must comply with the company or institution by which they will be hired.

Conclusion

As an employer, company leadership must be familiar with labor law in Mexico to avoid fines or lawsuits. In this article, we have provided information about the labor law that companies must follow and implement on behalf of their employees.

Once each element of labor law in Mexico has been identified, it is essential to include all of them in an employment contract that each hire has to sign. If a company fails to comply with the law, the consequences can be very severe, and fines may be imposed.