Mexican labor law has a long history that dates back to the 1910–1920 Mexican Revolution. The 1917 Constitution, which recognized employees’ rights to form labor unions and engage in collective bargaining, was established as a result of the workers’ fight for improved pay and working conditions during this time. The fundamental tenets of labor law, such as the right to a fair pay, secure working conditions, and social security, were also outlined in the Constitution.
Labor Costs in Mexico
Workers have a variety of labor rights under the Labor Law. Employees have some rights, such as the right to profit sharing, and they can only be fired under certain circumstances.
Foreign investors view Mexican labor law as “overprotective” and expensive if a person is fired without good reason. However, if a worker is fired without good reason, they have the right to seek job reinstatement or severance pay.
According to the Labor Law, there is a general minimum daily wage. This is the least amount of money that an employee must be paid for services done throughout a working day.
Mexico’s minimum wage is determined by the National Commission on Minimum Wages. Which is comprised of members from the government, labor unions, and employers.
The general daily minimum wage in Mexico (Salario Minimo) increased to $207.44 pesos on January 1, 2023, a 20% increase from the 2022 level of $172.87. The tariff in the “Northern Border Zone” was raised for 2023 to $312.41 pesos per workday, a 20% increase from the cost of $260.34 for 2022.
Read more about the minimum wage in Mexico here
The Federal Labor Law, which was most recently updated in 2019, primarily governs the labor laws in Mexico. The legislation outlines the duties and responsibilities of both employers and employees. Moreover, it rules regarding working conditions, pay, social security, and health and safety.
The right of workers to organize and form unions is one of the fundamental aspects of Mexican labor law. In establishing collective labor agreements, engaging in collective bargaining with employers, and defending employees’ rights, unions play a vital role. Futhermore, the law specifies how unions must be registered with the labor authorities and conduct elections.
The defense of workers’ rights against harassment and discrimination is a crucial component of Mexican labor law. The legislation forbids discrimination on the basis of gender, ethnicity, age, or any other factor. It creates mechanisms for reporting and looking into claims of harassment or discrimination at work.
Key Regulations on Working Hours and Contracts in Mexican Labor Law
Temporary contracts are only allowed. However, temporary contracts are only allowed when there is a good reason. For exmaple, during probationary periods or initial training, among other particular circumstances. The work shift determines the weekly working hours.
All shifts include a half-hour break while the day, night, and mixed shifts have eight, seven, and seven and a half hours of work, respectively. Overworking is legal in Mexico. However, there are several limitations. Employees are permitted to work up to three “extra” hours per day. Nevertheless, they are only permitted to do so three times a week, for a total of nine “extra” hours spread throughout the week. Although an employee is entitled to one day of paid vacation for every six days they work, ideally on Sunday, wages are calculated based on a seven-day workweek. A 25% bonus is added to the employee’s daily pay if he works on Sunday.
There have been a number of significant changes to Mexican labor law in recent years. The Federal Labor Law amendment in 2019 was one of the biggest revisions. The updated law included a number of new measures. This includs the formation of new labor conciliation and arbitration procedures. Moreover, the acknowledgement of employees’ right to strike, and independent labor tribunals to address labor disputes.
The United States-Mexico-Canada Agreement (USMCA), which was signed in 2020 and has new labor provisions requiring Mexico to strengthen its labor laws and respect workers’ rights, was another significant event. Mexico is obligated by the USMCA to set up independent labor courts and strengthen the rights of workers to collective bargaining.
In conclusion, the history of Mexican labor law is rich and goes back to the Mexican Revolution in the early 20th century. The Federal Labor Law currently in effect regulates the nation’s labor laws. It defines the duties and rights of both employers and employees. Futhermore it defines the terms and conditions of employment, wages, social security, and health and safety. Moreover, the 2019 amendment and the USMCA, two recent amendments to the labor code, aimed to increase workers’ rights, establish independent labor courts, and emphasize the value of collective bargaining. Therefore, Mexican labor law offers significant benefits for workers, including the right to a fair salary, job security, and protection against harassment and discrimination.