Employment conditions in Mexico

Employment conditions in Mexico

Mexico sets out specific employment regulations to protect both employees and employers. These rules cover contracts, working conditions, and workplace rights.

Taxes and social contributions

Employers in Mexico contribute to several social security and welfare programs on behalf of their employees.

• Social security (Instituto Mexicano del Seguro Social - IMSS) contributions
• Housing fund contributions (INFONAVIT)
• Retirement savings fund (AFORE) contributions
• Payroll tax, determined at the state level
• Mandatory employee income tax withholding

Both the employer and employee share contribution responsibilities, with rates set by law.

Working hours

The Federal Labor Law regulates standard working hours in Mexico.

• Standard workday is up to 8 hours
• Standard workweek is 48 hours (6 days)
• At least one full day of rest per week, usually Sunday
• Night shifts and mixed shifts have lower maximum hour limits

Work over these limits is considered overtime and must be paid accordingly.

Overtime rules

Overtime is strictly regulated to protect employee welfare.

• First 9 hours of overtime each week paid at 200 percent of regular pay
• Any additional hours paid at 300 percent
• Frequent use of overtime is discouraged by authorities

Leave entitlements

Employees in Mexico are entitled to several types of statutory leave.

• Annual paid vacation: Minimum 12 days after one year, increasing with seniority
• Vacation premium: At least 25 percent of vacation pay
• Maternity leave: Minimum 12 weeks, with job protection
• Paternity leave: Minimum 5 working days
• Official public holidays as defined by law
• Sick leave provided by social security, subject to medical certification

Employee rights and protections

Employees in Mexico benefit from comprehensive legal protections.

• Right to a written employment contract
• Freedom of association and collective bargaining
• Protection from discrimination based on gender, age, ethnicity, or other protected grounds
• Access to a safe and healthy workplace
• Data privacy and protection of personal information
• Whistleblower protections in certain circumstances

Probation and termination procedures

Probation periods are permitted if stipulated in writing and must not exceed 30 days, or up to 180 days for management roles.

Termination of employment must follow legal procedures. Dismissals generally require just cause and can involve severance payments depending on the grounds for separation.

• Notice and severance requirements as per the Federal Labor Law
• Collective dismissals may trigger additional obligations
• Unlawful termination entitles employees to reinstatement or statutory compensation

Telework regulations

From 2024, Mexico introduced detailed provisions for teleworking arrangements.

• Employers must keep updated records of teleworkers
• Workplaces must meet safety, health, and connectivity standards
• Employers must provide ergonomic equipment
• Annual safety and health training is required
• Employees have the right to return to onsite work for justified reasons
• Employers must document telework policies and ensure worker participation in safety commissions

Teleworkers also have duties, such as maintaining workplace conditions, safeguarding employer-provided equipment, and complying with data protection guidelines.

Intellectual property and confidentiality