MINIMUM EMPLOYMENT STANDARDS IN
MEXICO
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Copyright 1995 NLCIFT
MINIMUM EMPLOYMENT STANDARDS IN MEXICO
by
Anna Torriente
©National Law Center for Inter-American Free Trade
September 1995
Prior to the Mexican Revolution of 1910 and the enactment of
Constitutional Article 123 in 1917, working conditions in Mexico
were oppressive for much of the labor force. Work days were 14
hours long or more. Workers were paid pitifully low salaries,
which necessitated the entry into the work force of women and
minor children, whose working conditions were often worse than
those of male workers. There were no safety or hygiene
requirements in the workplace. There was no system of
compensation in the event of injury or disease arising out of the
employment, nor was there any system of benefits for old age or
death. Workers did not have a right to a weekly paid rest day.
Wages were not necessarily paid in cash; instead, the employer
often provided "tiendas de raya" which provided the worker with
goods, the cost of which were deducted from the worker's pay.
Following the Mexican revolution in 1910, the constitutional
congress that met in Quer‚taro, Mexico produced what is known as
the First Declaration of Social Rights (Primera Declaraci¢n de
Derechos Sociales). Article 27 of the Constitution regulates the
distribution of property. Article 123 sets forth a comprehensive
scheme for the protection of the Mexican worker.
Sources of Law
A. Constitutional Law
Article 123, Title 6 of the Mexican Constitution establishes
minimum employment standards in Mexico, including working hours,
minimum wages and compensation for improper dismissals. Section
A governs relations between employers and employees in general,
whereas Section B establishes the rights of employees of the
federal government and of the Federal District.
B. The Federal Labor Law
The Federal Labor Law (Ley Federal de Trabajo) is the regulatory
law implementing the constitutional protections established in
Constitutional Article 123. The Federal Labor Law (hereinafter
"FLL") was originally enacted on August 18, 1931 and has been
amended on various occasions, most recently in 1988.
The Federal Labor Law is applicable in all of the states of
the Republic of Mexico. Neither the individual states nor the
Federal District have enacted state legislation governing the
area of labor.
C. Decisional Law
There are jurisprudential precedents interpreting the labor
laws. Initial or first instance decisions are issued by local or
federal Conciliation and Arbitration Boards or Special Boards
composed of a representative from labor, one from management and
one from the government. Those decisions may be appealed to the
federal circuit court (colegiado de circuito) through a petition
for direct amparo relief (amparo directo).
General Principles
Article 1 of the FLL provides that the FLL shall be observed
throughout the Republic of Mexico and will govern the employment
relations contemplated in Article 123 of the Mexican
Constitution. Article 2 provides that labor standards shall
ensure harmony and social justice in the relations between
workers and employers.
Article 3 of the FLL recognizes the unequal bargaining power
which exists between the employer and the employee. Article 3
provides that labor standards shall ensure harmony and social
justice in the relations between employers and employees. The
intent of the law is therefore to afford greater protection to
the worker because he/she is the weaker half of the employer-
employee relationship and, in case of doubt, the more favorable
interpretation should be made in favor of the employee.
Article 18 of the FLL provides that, in interpreting the
labor laws, the objectives indicated in Articles 2 and 3 should
be taken into account. Where matters are in doubt, the
interpretation to be followed is that most favorable to the
worker.
Article 5 of the FLL establishes that the standards set by
the labor regulations are considered to be of "public order."
The parties to an employment contract may therefore not deviate
from these standards. Any stipulation or agreement regarding
employment must be made pursuant to the labor laws, otherwise the
standards found in the labor law must be applied. Any
stipulations contrary to the labor law will be deemed null and
void.
Article 6 of the FLL provides that all treaties executed and
approved in accordance with Article 133 of the Constitution and
the respective implementing laws will be applicable to labor
relations to the extent that they benefit the worker.
Definitions of Key Parties and Concepts:
The FLL provides specific definitions of the key parties and
concepts in the employment relationship.
-Employer: Defined as any individual or legal person that makes
use of the services of one or more workers. Directors, managing
directors, managers and, in general, all persons who exercise
directorial or managerial functions in the undertaking or
establishment, would be considered representatives or agents of
the employer. (FLL Article 10).
-Worker: Any individual who personally performs subordinate work
for another person, whether that person is an individual or a
corporation. ( FLL Article 8).
-Confidential Employee: A worker who performs a special kind of
work involving supervisory activities are involved. (FLL Article
9).
-Work: Defined as any human, intellectual or manual activity,
irrespective of the degree of technical training required for
each occupation or trade. (FLL Article 10).
-Working Hours: Defined as the time during which the worker shall
be available at the employer's service for the performance of the
work. (FLL Article 11).
-Intermediary: Any person who contracts or intervenes in
contracting for the services of another person or other persons
for the performance of work for an employer. (FLL Article 12).
-Enterprise: The economic unit of production or distribution of
goods or services. (FLL Article 17).
-Establishment: The technical unit which, as a branch, agency or
the like, is an integral part and contributes to the achievement
of the Enterprise's objects. (FLL Article 16).
-Employment relation: The personal performance of work under the
authority of another person, in return for payment of
remuneration. (FLL Article 20).
-Individual contract of employment: Irrespective of its form or
title, this is a contract by which a person undertakes to perform
a personal service for another under his/her management and
supervision in return for payment or remuneration. (FLL Article
20).
Composition of the Work Force
Article 7 requires Mexican employers to employ at least 90%
Mexican workers in their enterprises. All technical and
professional workers must be Mexican, unless there are no Mexican
workers qualified in a particular specialty. In that case, the
employer may employ foreign workers, but only to the extent of
10% of the labor force engaged in the specialty. It is then
incumbent upon the employer and the foreign workers to train the
Mexican workers in the specialty. All doctors in the service of
employers must be Mexican nationals.
Article 7 is not applicable to directors (CEOs),
administrators and general managers. (Note: NAFTA Chapter 16
permits exchanges of workers between the NAFTA countries as long
as there is reciprocity).
Working Terms and Conditions:
Article 56 of the FLL establishes general provisions
governing the employment relationship. This article provides
that working conditions cannot be inferior to those established
in the labor law. The employer must take into account the
importance of the work performed and must ensure that equal
conditions prevail for equal work. The employer may not
differentiate on the grounds of race, nationality, sex, age,
religion or political opinion, except as provided by law
(differences for pregnant women and minors). Note: Article 4 of
the Mexican Constitution, as amended by Decree published December
31, 1974, provides that men and women are equal under the law.
See also FLL Article 164).
If the employer fails to comply with the requirements of
Article 56, the worker may petition the conciliation and
arbitration board ("CAB") for modification of the unlawful
conditions. (FLL Article 57) The employer may also seek
modification of the working conditions where economic conditions
dictate.
Articles 21 and 26 of the FLL require working conditions to
be set forth in writing by the employer if there is no collective
labor agreement. Nonetheless, in the absence of such a contract,
the employment relation shall be presumed between the person
performing a personal service and the person receiving such
services and this situation does not deprive the employee of this
rights derived from the labor standards and the services
performed.
The Work Contract:
Pursuant to FLL Article 25, the written contract of work
conditions must specify:
1- The name, age, nationality, sex, marital status and
address of the worker and employer;
2- Whether the employment relation is for a specific task or
for a specific period or without limit of time;
3- The service or services to be rendered (to be indicated
with specificity);
4- The place or places where the work is to be performed;
5- The working hours;
6- The nature and amount of wages;
7- The date and place of payment of wages;
8- A declaration that the worker will be trained in
accordance with the established procedures of the enterprise and
in accordance with the terms of the labor laws; and
9- Other working conditions, such as rest days, vacations
and other issues upon which the worker and employer may agree.
Employment Abroad:
Extra protection is provided to a Mexican national who
contracts to work for a foreign employer for foreign work or work
on foreign soil. First, the labor contract must be signed by a
competent municipal authority and countersigned by the consul of
the nation to which the employer is to go. In addition to the
ordinary specifications to be contained in the contract, it must
clearly specify that the expense of repatriating the employee
should be borne by the foreign employer.
Where employers use intermediaries to contract workers, the
employer remains responsible for all obligations. Such workers
have the same rights as regularly employed workers and the
intermediaries may not take a commission or charge fees from
their salaries.
Agreements Prohibited by Operation of Law:
The Constitution expressly prohibits the inclusion of certain
terms and conditions in a labor contract. Where included in a
contract, the following conditions will be considered null and
void and of no binding effect upon the parties:
- Stipulating an excessively long work day
- Fixing wages that are not remunerative in the judgment of
Conciliation and Arbitration Boards ("CABs")
- Stipulating a period of over 1 week before payment of a
day's wages
- Stipulations indicating the place of payment of wages as a
place of recreation such as an inn, caf‚, bar or store, except
where the employee is employed in such an establishment.
- Stipulations imposing upon the employee the direct or
indirect obligation to acquire consumer goods in specified stores
or places.
- Stipulations permitting the employer to retain the
employee's wages or a portion thereof as a fine.
- Stipulations constituting a waiver on the part of the
employee to indemnification to which he/she might otherwise be
entitled because of workplace injuries, occupational diseases,
damages occasioned by the non-performance of the contract or
because of unjustified dismissal.
- Any other stipulations waiving any right designed to
protect the female worker.
Duration of Employment:
The presumption in the labor law is that the employment
duration is for an indefinite period of time. (FLL Article 35).
On the other hand, Article 40 of the FLL establishes that in no
case may a worker be obligated to accept employment for more than
one year. Under certain circumstances, the law allows the
employment relation for a specified duration or for specified
work:
- Where the nature of the work mandates a specific time
period
- Where the object of the work relationship is to substitute
another worker
- In all other cases provided for by law.
FLL Article 37 provides that a "contract of specified
duration may be made only in the following cases: (1) where the
nature of the work to be done so requires; (2) when the contract
is to provide a temporary substitute for another employee; and
(3) in the other cases provided for by the labor laws.
Working Hours:
The working day is defined by FLL Article 58 as that period
during which the employee is available to the employer to render
services. The FLL states that working hours can be fixed freely
by the agreement of employer and employee. (FLL Art. 59) The
agreement may not, however, exceed the maximum work day fixed by
the FLL and the hours of work must be arranged to enable the
workers to have Saturday afternoons off or reach some similar
arrangement. (Id.)
Working hours are grouped according to the following
classifications: day work; night work and mixed hours. Day work
is the work performed between 6 a.m. and 8 p.m. Night work is
the work performed between 8 p.m. and 6 a.m. Mixed work hours
are working hours that include both day and night work, provided
that the period of night work is less than 3 and one-half hours.
If there are more than 3 1/2 night hours, the shift will be
considered to be night work. (FLL Articles 60, 63, 64).
Article 61 sets forth the maximum duration of the work day:
Eight hours for day work; seven for night work; and seven and
one-half in the case of mixed hours. The work week is six days
long.
If the employee works continuous daily hours, he/she shall
receive a rest period of at least half an hour during the work
day. The worker must be permitted to actually leave the work
area during the rest period. If the worker cannot leave the work
area during rest periods and meal times, such periods shall be
deemed to be hours actually worked and shall be included in the
daily hours of work. (FLL Articles 63, 64) For decisional law,
see Ad 2902/81, Adri n Quezada Trejo and others, 17/VIII/81. 5
votes.
The working day may be extended in case of an emergency
which places the lives of workers, the employer, or the viability
of the enterprise in imminent danger. The working day may be
extended only for the time necessary to avoid or prevent this
danger. (FLL Article 65).
In contrast, the United States Fair Labor Standards Act, 29
U.S.C. 207 (a)(1), sets the maximum workweek at 40 hours and
provides that employers must pay employees one and one-half times
their regular pay rate if they work overtime. Subsection
207(a)(1) provides, in relevant part:
Except as otherwise provided in this section, no employer
shall employ any of his employees who in any workweek is
engaged in commerce or in the production of goods for
commerce for a workweek longer than forty hours, unless such
employee receives compensation for his employment in excess
of the hours above specified at a rate not less than one and
one-half times the regular rate at which he is employed.
Age Requirements:
Mexican labor law provides that it is unlawful to employ
children under the age of 14 years. These provisions are based
upon the assumption that it is the duty of society and the
children's parents to first tend to the development of minors.
Children between the ages of 14 and 16 may work under certain
circumstances. They should have completed their compulsory
education, except in cases approved by the CAB. The maximum
working day for children between 14 and 16 years of age is six
working hours. (See Constitutional Article 123 (A)(III)).
Minors under 16 may not engage in unhealthy or hazardous
work, industrial night work or work of any kind after 10 o'clock
at night. (See Constitutional Article 123(A)(II)). Minors
between the ages of 14 and 16 may not work if they have not
completed their compulsory education, unless the CAB deems it
beneficial in that there is a connection between the work and
schooling. Such minors must have permission from their parents
or guardians to work. Individuals over the age of 16 may
contract their services freely, subject to the limits set forth
in the labor law.
Minors between the ages of 14 and 16 must obtain a medical
certificate certifying their ability to work. They must also
subject themselves to the periodic medical examinations required
by the Labor Inspection Department (Inspecci¢n del Trabajo).
Without such a certificate, no employer may lawfully utilize the
minor's services. (FLL, Article 174).
FLL Article 178 prohibits minors between the ages of 14 and
16 from working overtime, on Sundays or on paid rest days. If
this provision is violated, the employer will be required to pay
the minor 200% of the minor's regular salary. Minors between the
ages of 14 and 16 are entitled to at least 18 paid vacation days
per year. (FLL Article 179).
FLL Articles 175 and 176 set forth certain types of
hazardous work in which minors may not engage. Article 176
provides that minors under 18 may not engage in industrial night
work.
Children under the age of 18 cannot be hired for purposes of
working outside of Mexico, except in the case of individuals with
technical or professional training, artists, sportspersons and
specialized workers. (FLL Article 29)
Overtime:
The labor laws permit workers to work past their regular
working schedule where exceptional circumstances require. Up to
nine hours of overtime may be worked, not to exceed three hours a
day or three times a week. Overtime work performed during this
time should be paid at an additional one hundred per cent. Any
time worked over nine hours of overtime per week must be paid at
a rate of two hundred percent of the worker's ordinary rate.
(FLL Articles 66, 67) Pursuant to FLL Article 68, no worker may
be compelled to work longer hours than those permitted under the
labor law. The amount of overtime payment due to the worker does
not form part of the salary for purposes of indemnity except
where it is paid in a fixed, permanent form. See Ad 5784/77.
Ferrocarriles Nacionales de M‚xico, 3/VII/78. Unanimity of 4
votes.
While 29 U.S.C. 207(a)(1) sets forth the general rules that
overtime is paid at time and a-half, exemptions are made for a
number of occupations, including employers engaged in handling,
slaughtering, dressing of livestock, cotton ginners and
compressors, employers engaged in first processing of fruits and
vegetables. The purpose of the exemption is to enable such
employers to avoid the burden of overtime in those seasonal or
peak periods when they must work to take care of the product on
market, the amount of which depends on factors beyond their
control. Walling v. Swift & Co., 131 F. 2d 249 (C.C.A. Ill.
1942).
In practice, overtime in Mexico is often not paid. Where
the worker receives overtime, it is usually paid at the rate of
double pay.
The Employment of Women:
FLL Article 164 provides that women shall have the same
rights and obligations as men. Constitutional Article 123
(A)(VII) establishes the principle of equal pay for equal work
regardless of gender. Nevertheless, the labor laws establish a
special protective scheme for maternity.
FLL Article 166 provides that, when the health of a woman or
her fetus/child would be endangered during the pregnancy or
nursing period, she may not engage in unhealthy or dangerous
labor, night industrial work or work in commercial or service
establishments after 10 o'clock at night. These rights are
without prejudice to the female employee's salary, benefits and
other rights under her employment agreement. This prohibition,
however, has the effect of denying the female employee the
ability to earn greater income by forbidding her from working
overtime.
Pregnant Employees:
`Women during pregnancy may not perform physical labor requiring
considerable effort and which could be hazardous to their health.
Maternity Leave:
Pregnant employees are entitled to six weeks' leave prior to
the approximate date of childbirth and to six weeks' leave
thereafter. During this time period, they are entitled to
receive their full wages and retain their employment and the
rights acquired under their labor contract. During the nursing
period, nursing mothers are entitled to two extra paid half-hour
rest periods for nursing their children. (Constitutional Article
123(A)(V); FLL Article 170, paras. II, IV and V).
The six weeks' maternity leave may be extended to the time
necessary if it is impossible for the female worker to return to
work due to her pregnancy or postnatal recovery. During the
regular six week maternity leave, the female worker is entitled
to her full wages. In the case of extended maternity leave, the
worker will be entitled to half pay for no more than 60 days.
(FLL Article 170). With regard to paid maternity leave, the
Mexican Social Security Institute ( Instituto Mexicano de
Seguridad Social, hereinafter "IMSS") subsidizes 60% of the
female worker's salary; therefore, the employer need only pay the
difference.
The IMSS provides nursery services for children of workers
from 43 days to 4 years of age. (FLL Article 171). This system
was established as a social service charged against the IMSS and
was published in the Diario Oficial on March 23, 1973.
Finally, FLL Article 172 requires the employer to provide a
sufficient number of chairs for working mothers. In fact, this
is an obligation the employer owes to the workers regardless of
sex or maternal/gestational status. (FLL Article 132 (V)).
Rest Days:
Article 69 of the FLL states that workers are entitled to at
least one rest day, preferably on Sunday, receiving full pay
every six days. If, for some reason, the worker is obligated to
work on a Sunday, he will be entitled to an extra bonus of 25% of
the ordinary rates.
Reportedly, rural farm workers (trabajadores del campo), at
least in Sinaloa, often do not receive the required paid rest
day.
In industries requiring continual work, the employer and
employee may agree upon those days in which the worker may enjoy
his/her day of rest.
The preferred day of rest under the FLL is Sunday. Workers
who work on Sundays will receive at least an additional 25% in
pay over the salary on other weekdays. (FLL Article 71).
FLL Article 72 provides that a worker may not be obligated
to work on his/her rest days. If this provision is not observed
and the employee is compelled to work, the employer must pay the
worker double time for the work actually performed, in addition
to the wages to which he/she is entitled for working on the rest
day.
Article 74 establishes the following holidays:
January 1st
February 5th
March 21st
May 1st
September 16th
November 20th
December 25th
The first day of December every six years, when the new
President of Mexico takes office
Election days, which are determined by the federal laws and
the local electoral body, in the case of ordinary elections
On the above holidays, the employers and workers decide how
many employees shall be required to work. If no agreement can be
reached, the matter is submitted to the permanent conciliation
board, or, failing this, to the conciliation and arbitration
board. The workers required to work shall be entitled to double
pay for time worked on the above holidays. (FLL Article 75).
Vacations:
Article 76 of the FLL states that workers who have been in
the service of an employer for more than one year shall be
entitled to receive an annual vacation leave, which shall in no
case be less than 6 working days, and shall be increased by two
working days (up to a maximum of twelve) for each subsequent year
of service. After the fourth year, the vacation period shall be
increased by two days for every five years of service.
Even though the right to payment of vacation time arises
after the worker has completed one year of service, in cases
where this requisite is not met, the worker is entitled to be
paid a proportional share of this benefit. For case law, see
Vol. XVIII, page 21. Ad 2366/64. Guadalupe Atilano Cornejo.
Unanimity of 4 votes. (Report, 4th Chamber 1981. Decision 220,
page 168).
FLL Article 77 provides that seasonal or occasional workers
will be entitled to vacation time on a pro rated basis, in
proportion to the number of days worked each year.
Workers must take at least 6 days of vacation time in an
uninterrupted period. FLL Article 79 specifically provides that
it will be considered unlawful to pay compensation in lieu of
providing vacation leave. If the employment relationship ends
before the worker finishes his/her first year of service, he/she
will be entitled to compensation for accumulated vacation time.
(Article 79). In practice, many workers accept compensation for
vacation time.
Vacation must be given within the six months following the
date on which the worker completed his/her year of service. The
employer must issue yearly to each worker a record stating
his/her seniority, length of service and, based on that, the
period of leave entitlement and the date(s) on which the leave
may be taken. (FLL Article 81).
Workers who perform casual or discontinuous work and
seasonal workers are also entitled to an annual vacation. Their
vacations are granted in proportion to the number of days worked
in a year. (FLL Article 77).
In all cases, the worker will be entitled to a bonus (prima)
of not less than 25% of the wages payable in respect of the
vacation period. (FLL Article 80) Employers generally comply
with this provision of the labor law.
Wages:
FLL Article 82 defines wages as:
The remuneration which the employer is obligated to pay to
the worker in exchange for his/her work.
The wage shall be sufficiently rewarding, and in no case
less than the amount fixed by labor law as a minimum. In fixing
the amount of the wage, the quantity and quality of the work must
be taken into consideration. FLL Article 86 reflects the
constitutional principle of equal pay for equal work under equal
working conditions.
Wages are set by agreement between the parties. Wages must
be paid every week in the case of persons engaged in manual work,
or every 15 days in the case of all other workers. (FLL Article
88). In practice, certain types of office and managerial
personnel are paid on a monthly basis.
FLL Article 83 provides that wages may be fixed according to
a unit of time, on a piecework or commission basis, in a lump sum
or in any other manner. Where salary is based on unit of time,
it is necessary to specify the time the work period is to last,
and the schedule to be met, in order to determine whether the
work is day work, night work, or mixed. If the wage is fixed on
a piecework basis, the nature of the work shall be specified as
well as the quantity and quality of the material, the state of
any tools and equipment which the employer amy provide for
executing the work, and the amount of time for which the tools
and equipment will be made available to the employee. No
deductions from the employee's pay may be made on account of any
normal wear and tear to the tools and implements as a result of
the work. (FLL Article 83).
Equal Pay:
Equal wages must be paid for equal work, regardless of sex
or nationality. (Constitutional Article 123 (A)(VII)).
U.S. workers are protected from discrimination in pay on the
basis of gender by the Fair Labor Standards Act, 29 U.S.C.
206(d)(1), the Equal Pay Act of 1963 and Title VII, which also
prohibits discrimination in the terms and conditions of
employment on the basis of race, color, national origin, religion
and handicap. 29 U.S.C. 206(d)(1) provides, in pertinent part:
No employer having employees subject to any provisions of
this section shall discriminate, within any establishment in
which such employees are employed, between employees on the
basis of sex by paying wages to employees in such
establishment at a rate less than the rate at which he pays
wages to employees of the opposite sex in such establishment
for equal work on jobs the performance of which requires
equal skill, effort and responsibility, and which are
performed under similar working conditions, except where
such payment is made pursuant to (i) a seniority system;
(ii) a merit system; (iii) a system which measures earnings
by quantity or quality of production; or (iv) a differential
based on any other factor other than sex.
The FLSA provision was intended as a "broad charter of
women's rights in the economic field and was designed to
eliminate all wage discrimination based on sex which Congress had
found in 1963 to exist on a substantial scale. Grumbine v. U.S.,
586 F. Supp. 1144 (D.C.D.C. 1984).
Integrated Salary:
Pursuant to FLL Article 84, a worker's salary is integrated
not only with the cash received as his/her base salary, but also
with bonuses or tips, housing (whether the employer directly
provides housing or pays a quota to INFONAVIT), commissions,
fringe benefits (such as a company car, etc.) and any other
monies or in-kind benefits given to the worker in exchange for
his/her work.
Wages must be remunerative and in no event may they be lower
than the established minimum wage. In fixing the amount of
wages, the quantity and quality of the work shall be taken into
account. If the salary is based on piece work, the compensation
paid must be calculated so as to yield at least the minimum wage
over the course of a normal 8-hour workday. (FLL Article 85).
Year-end Bonus (Aguinaldo):
This is a monetary bonus that employers give to employees at
Christmastime. The right to the aguinaldo is established in
Article 87 of the labor law which states that workers shall be
entitled to an annual bonus to be paid before the 20th day of
December. The bonus must be equal to at least 15 days' wages.
FLL Article 87 provides that workers who have not yet
completed their year of service at the time of distribution of
the aguinaldo are entitled to receive a portion of the aguinaldo
commensurate to the period of their employment.
Minimum Wage:
The term minimum wage is defined as the smallest cash
payment which a worker should receive for services performed
during a working day. (FLL Article 90) The term minimum salary
refers to a minimum daily wage, not a minimum hourly wage.
There are two classes of minimum salaries, general and
professional. Workers are guaranteed a minimum wage, which may
be for general or professional work, distinguishing between rural
and city employment. Delivery of the minimum wage to the worker
is guaranteed by the provision establishing that the minimum wage
shall be free from attachment, compensation or deduction.
Evasion by an employer of payment of the minimum salary renders
the employer subject to a criminal penalty for salary fraud under
Articles 386 and 387, Section XVII of the Federal Penal Code.
Minimum wages may be general for one or more geographic
area, which may be applied to a specific profession, office or
specific work, in one of these geographic areas. (Article 91)
The general minimum wage for a geographic area will govern all
workers in that area, regardless of their economic activity,
profession, office or specific work. (Article 92).
Article 94 provides that the minimum wage will be set by a
National Commission composed of representatives of workers,
employers and the government. The Commission may avail itself of
special commissions of a consulting nature which it may deem
necessary to its proper functioning. Article 570 provides that
the minimum wage will be set every year and will go into effect
on January 1 of the next year.
The Commission has a technical department (Direcci¢n
T‚cnica) which conducts surveys and studies regarding the minimum
wage to determine the general condition of the economy, the
principal changes in the development of economic activities and
changes in the cost of living for Mexican families. The
Department also takes into account the inflation rate and the
expected average rate of productivity in the economy.
The National Minimum Wage Commission (Comisi¢n Nacional de
los Salarios M¡nimos) has divided Mexico into three geographic
areas: A, B and C, according to the authority given to it by
Article 96. The minimum wage varies according to which area the
worker is located. Because the minimum wage varies, workers are
beginning to migrate toward the areas where wages are higher.
For example, in Monterrey, Nuevo Leon, in area "B", the wages are
higher than in certain other surrounding areas in the State of
Nuevo Leon, which are classified as area "C", so a significant
number of workers are coming to the city from outlying areas to
look for work, a problem which may, of course, precipitate a
scarcity of jobs in that city.
Area "A" is composed of: all municipalities in the States of
Baja California and Baja California Sur; the municipalities of
Guadalupe, Ju rez and Praxedis G. Guerrero of the State of
Chihuahua; the Federal District; Acapulco de Ju rez in the State
of Guerrero; the municipalities of Atizap n de Zaragoza,
Coacalco, Cuautitl n, Cuautitl n-Izcalli, Ecatepec, Naucalpan de
Ju rez, Tlalnepantla de Baz and Tultitl n of the State of M‚xico;
the municipalities of Agua Prieta, Cananea, Naco, Nogales,
Plutarco El¡as Calles, Puerto Pe¤asco, San Lu¡s R¡o Colorado and
Santa Cruz of the State of Sonora; the municipalities of Camargo,
Guerrero, Gustavo D¡az Ordaz, Matamoros, Mier, Miguel Alem n,
Nuevo Laredo, Reynosa, R¡o Bravo, San Fernando and Valle Hermoso
of the State of Tamaulipas; and the municipalities of Agua Dulce,
Coatzacoalcos, Cosoleacque, Las Choapas, Ixhuatl n del Sureste,
Minatitl n, Moloac n and Nanchital de L zaro C rdenas del R¡o in
the State of Veracruz.
Area "B" is composed of: the municipalities of
Guadalajara, El Salto, Tlajomulco, Tlaquepaque, Tonal and
Zapopan in the State of Jalisco; Apodaca, Garza Garc¡a, General
Escobedo, Guadalupe, Monterrey, San Nicol s de los Garza and
Santa Catarina in the State of Nuevo L‚on; the municipalities of
Altar, Atil, B cum, Benjamin Hill, Caborca, Cajeme, Carb¢, La
Colorada, Cucurpe, Empalme, Etchojoa, Guaymas, Hermosillo,
Huatabampo, Imuris, Magdalena, Navojoa, Opodepe, Oquitoa,
Ptiquito, San Miguel de Horcasitas, Santa Ana, S ric, Suaqui
Grande, Trincheras,and Tubutama in the State of Sonora; the
municipalities of Aldama, Altamira, Antiguo Morelos, Ciudad
Madero, G¢mez Far¡as, Gonz lez, Mante, Nuevo Morelos, Ocampo,
Tampico and Xicot‚ncatl of the State of Tamaulipas; and the
municipalities of Coatzintla, Poza Rica de Hidalgo and Tuxpan of
the State of Veracruz.
Area "C" is composed of: all of the municipalities of the
States of Aguascalientes, Campeche, Coahuila, Colima, Chiapas,
Durango, Guanajuato, Hidalgo, Michoac n, Morelos, Nayarit,
Oaxaca, Puebla, Quer‚taro, Quintana Roo, San Luis Potos¡,
Sinaloa, Tabasco, Tlaxcala, Yucat n and Zacatecas; all of the
municipalities of the State of Chihuahua except for Guadalupe,
Ju rez and Praxedis G. Guerrero; all of the municipalities of the
State of Guerrero except Acapulco de Ju rez; all of the
municipalities of the State of Jalisco except for Guadalajara, El
Salto, Tlajomulco, Tlaquepaque, Tonal and Zapopan; all of the
municipalities of the State of M‚xico except for Atizap n de
Zaragoza, Coacalco, Cuautitl n, Cuautitl n-Izcalli, Ecatepec,
Naucalpan de Ju rez, Tlalnepantla de Baz and Tultitl n; all of
the municipalities of the State of Nuevo L‚on except for Apodaca,
Garza Garc¡a, General Escobedo, Guadalupe, Monterrey, San Nicol s
de los Garza and Santa Catarina; the municipalities of Aconchi,
Alamos, Arivechi, Arizpe, Bacad‚huachi, Bacanora, Bacerac,
Bacoachi, Ban michi, Bavi cora, Bavispe, Cumpas, Divisaderos,
Fronteras, Granados, Huachinera, Hu sabas, Hu‚pac, Mazat n,
Moctezuma, N cori Chico, Nacozari de Garc¡a, Onavas, Quiriego,
Ray¢n, Rosario, Sahuaripa, San Felipe de Jes£s, San Javier, San
Pedro de la Cueva, Soyopa, Tepache, Ures, Villa Hidalgo, Villa
Pesqueira and Y‚cora of the State of Sonora; the municipalities
of Abasolo, Burgos, Bustamante, Casas, Cruillas, G‚mez, Hidalgo,
Jaumave, Jim‚nez, Llera, Mainero, M‚ndez, Miquihuana, Padilla,
Palmillas, San Carlos, San Nicol s, Soto la Marina, Tula,
Victoria and Villagr n of the State of Tamaulipas and all of the
municipalities of the State of Veracruz except for Agua Dulce,
Coatzacoalcos, Coatzintla, Cosoleacque, Las Choapas, Ixhuatl n
del Sureste, Minatitl n, Moloac n and Nanchital de L zaro
C rdenas del R¡o, Poza Rica de Hidalgo and Tuxpan.
The labor law establishes that the minimum wage shall be
sufficient to meet the normal requirements of a head of a family
of a material, social and cultural order and to meet the
obligatory educational requirements of his/her children. Despite
this provision, in Mexico it is almost impossible to survive on
this kind of salary.
There is a growing trend in Mexico to eliminate the
differences in minimum salaries based on geographic areas. It is
probable that in the near future there will be only two
different minimum salaries and one general minimum salary for t
he whole of Mexico. The term general minimum salary is
understood as the amount which must be paid to a worker for
performing the simplest activity for which no specialized
education is required.
The minimum daily wage for general employment was set for
January 1, 1995 as follows:
New Pesos
Area "A" N$16.34
Area "B" N$15.18
Area "C" N$13.79
The Commission also set the minimum salaries for specific
professions, offices and specialized activities. (See Table at
Appendix A).
Given the high rate of inflation in Mexico and the
precipitous devaluation of the peso, the general minimum daily
salary was raised by decree published in the Diario Oficial on
March 31, 1995:
New Pesos
Area "A" N$18.30
Area "B" N$17.00
Area "C" N$15.44
The minimum wage for specific professions, offices and
specialized activities was also increased by the March 31, 1995
decree. (See Table at Appendix B).
This action by the Commission precipitated many complaints
because, at the same time that the minimum wage was raised by
approximately 12%, the Mexican government raised the value added
tax on consumer goods (IVA) by 10-15%.
In Mexico, the minimum wage is no longer a valid point of
reference, because no employer pays minimum wage; workers cannot
survive on such a small amount. Where a kilo of meat costs 22
pesos and the minimum wage is 15-20 pesos a day, the pay rate is
obviously woefully inadequate. Generally, on the average
employers pay workers some 15-20% over the minimum wage rate.
Because wages are nevertheless so low, more and more members of
the family are forced to work to help sustain the household and,
despite the provisions in the labor law prohibiting minor
children from working, child labor has begun to proliferate again
in Mexico.
Frequently, employers will agree to pay workers more than
the minimum wage, but will register the worker with social
security as earning the minimum wage, so that the employer's
premiums will be lower. Article 21 of the Social Security Law
entitles workers to request their registration information from
the Social Security Administration and communicate to the
Administration any modification in their salary and any other
change in their job conditions.
Minimum wages may be general for one or more geographic
areas which may cover one or more states, or occupational groups
for a given branch of economic activity or for individual
occupations, trades or special work, within one or more
geographic areas. (FLL Article 91) The general minimum wages
shall be valid for all the workers in the geographic areas
concerned, irrespective of the branch of economic activity,
occupations, trades or special work.
Pursuant to FLL Articles 94, 95 and 96, minimum wages are
fixed by the National Board of Minimum Wages. This board is
composed of workers, employers and government representatives
which may receive help from special consultative committees.
This Board determines the division of the Mexican territory into
geographic areas, which shall consist of one or more
municipalities in which the same general minimum wage shall
apply, without there necessarily existing a territorial
continuity between said municipalities.
By law, minimum wages cannot be the subject of set off,
discount or reduction, except in the cases mentioned in FLL
Article 97:
1) Alimony or maintenance payments ordered by the competent
authority in favor of spouse, children, parents or grandparents
and grandchildren, decreed by the competent authority.
2) Rental payments to the employer for worker's housing
provided by the employer. Article 151 provides that such rent
cannot exceed .5% monthly of the cadastral value of the property.
In no event may the amount deducted for rent exceed 10% of the
worker's salary.
3) Installment payments toward loans originating from the
National Worker Housing Fund (Fondo Nacional de la Vivienda para
los Trabajadores), intended for the acquisition, repair,
enlargement or improvement of residential housing or for the
payment of loans acquired for those purposes. Those workers who
have been granted a credit for the acquisition of houses located
in multiple family dwellings financed by the Institute of the
National Workers Housing Fund, 1% of the salary to which Article
143 of this law refers will be discounted which shall be intended
to cover the costs expended for administration, operation and
maintenance of the multiple family housing. These discounts must
have been freely agreed to by the worker and may not exceed 20%
of the worker's salary.
4) Installment payments in connection with loans guaranteed
by the Development and Guarantee Fund for the Protection of
Worker's Consumption of Consumer Goods. (Fondo de Fomento y
Garant¡a para el Consumo de los Trabajadores, hereinafter
"FONACOT") referred to in Section 103 bis of this law, taken out
for the purchase of durable consumer goods or for the payment of
services. Such deductions must have been freely agreed to by the
worker and in any event may not exceed 10% of his/her wages.
The minimum wage in the United States is fixed by statute.
The Fair Labor Standards Act, 29 U.S.C. 206(a) has set the
minimum wage at $4.25 per hour. Subsection 206(a) reads:
Every employer shall pay to each of his employees who in any
workweek is engaged in commerce or in the production of
goods for commerce, or is employed in an enterprise engaged
in commerce or in the production of goods for commerce,
wages at the following rates:
(1) except as otherwise provided in this section, not
less than $3.35 an hour during the period ending March 31,
1990, not less than $3.80 an hour during the year beginning
April 1, 1990, and not less than $4.25 an hour after March
31, 1991.
Protective Norms/Salary Privileges:
Workers may freely dispose of their salaries. Any
stipulations or measures to the contrary will be void. (FLL Art.
98). The worker's right to receive salaries cannot be renounced
or waived. (FLL Article 99).
The salary shall be paid directly to the worker, except
where is impossible for the worker to receive it directly; in
such case the worker may designate an agent to collect the salary
on his/her behalf in a writing witnessed by at least two persons.
(FLL Article 100).
The salary must be paid in legal tender. The salary cannot
be paid in goods, vouchers, chips, tokens or other objects
intended to be representative of the monies owed to the worker.
There are, however, enterprises in which the labor agreement
gives the worker vouchers or slips which may be exchanged for
merchandise, especially foodstuffs. This arrangement does not
constitute a violation of FLL Article 101 where, instead of
substituting the worker;s salary, the vouchers or slips actually
increase the salary to the extent that these fringe benefits
become part of the worker's salary.
FLL Article 102 requires that all payments in kind be
appropriate for the personal use of the worker and his family and
in reasonable proportion to the amount of the wage paid in cash.
This provision contemplates the use of vouchers or slips that may
be exchanged for merchandise, but requires the following
characteristics: (1) they must be fringe benefits that complement
the worker's salary; (2) they must be merchandise that is truly
useful to the worker; and (3) cash must constitute the main part
of the salary, so that if these in-kind benefits do not exist,
the worker will still be able to acquire the merchandise.
FLL Article 103 provides that stores which distribute
clothing, foodstuffs, an articles for the home, may be created by
agreement between workers and employers of one or more
enterprises in according with the following:
- Purchase of the merchandise shall be entirely voluntary
and the workers may not be coerced to buy in any manner
whatsoever.
- The purchase price of the goods shall be fixed by
agreement between the workers and employers, but in no event may
they exceed the official price for the goods or, in the absence
of an official price, the current market price for the goods.
Price modifications for goods shall also follow this principle.
- The agreement shall determine the degree of participation
which the workers shall have in the administration and management
of the store.
Article 103 bis provides that the government shall regulate
the formation of the Fondo de Fomento y Garant¡a para el Consumo
de los Trabajadores which will provide financing for the stores
contemplated by Article 103 and will manage other institutions to
grant and guarantee low cost and convenient credit to facilitate
workers' purchase of goods and services.
Protection of the Worker's Salary:
Constitutional Article 123(A)(X) establishes that workers
must be paid in legal tender, thereby effectively eliminating the
tiendas de raya.
A worker's salary may not be garnished or subjected to a
fine. (FLL Arts. 105, 107). Deductions from a worker's salary
may be made only in the following circumstances:
- Repayment to the employer of cash advances or for
overpayment or purchase of goods produced by the enterprise. The
amount deductible may in no event exceed one month's salary and
the deduction taken is that agreed to by the worker and the
employer, but in no event to exceed 30% of the minimum salary.
- Payment of rent to the employer in accordance with FLL
Article 151, not to exceed 15% of the worker's salary.
- Installment payments toward loans originating from the
National Worker Housing Fund. (FLL Article 110).
A worker's salary may not be garnished except in the case of
court-ordered support payments. The employer is not bound to
honor any other type of garnishment request. (FLL Art. 112).
Any assignment of a worker's salary in favor of the employer or
any third party shall be deemed void. (FLL Art. 104). Debts
which a worker contracts with his employer shall not be subject
to interest. (FLL Article 111).
Salaries must be paid on the premises where the worker
renders his/her services. Payment must take place on a working
day, either during or immediately after the work day. (FLL Art.
109). Wages are generally paid on a Saturday, typically called a
d¡a de raya.
Wages earned by workers in the prior year and
indemnifications to which the workers may be entitled shall take
precedence over any other debts of the employer, including
mortgages on real property, tax liens and those held by the
Mexican Social Security Administration against the employer's
assets. (FLL Art. 113).
Workers will not be required to file creditor's claims in
bankruptcy or other legal proceedings. The CAB will attach and
foreclose upon the assets necessary to pay the requisite salaries
and indemnification. (FLL Art. 114). The beneficiaries of a
deceased worker shall be entitled to all the worker's accrued
salaries and benefits and may pursue an action for those
benefits. (FLL Art. 115).
Workers' Right to Share in the Profits of the Employer:
Article 123(A)(IX) of the Mexican Constitution and Article
117 of the Federal Labor Law provide that all workers who have
been employed for 60 days or more are entitled to share in the
profits of enterprises with which they are employed in the
percentage determined by the National Commission for the Sharing
of Profits (Comisi¢n Nacional para la Participaci¢n de los
Trabajadores en las Utilidades de las Empresas). (FLL Article
127(VIII)). Profit is defined as taxable income. (FLL Art.
120).
All workers who have been employed for 60 days or more have
the right to participate in profits of the enterprise, although
not in its management. The percentage is fixed by the Comisi¢n
Nacional para la Participaci¢n de los Trabajadores en las
Utilidades de las Empresas and is determined based on the annual
income tax statement filed by the corporate employer. The
percentage was fixed at 10% by decree published in the Diario
Oficial dated February 28, 1985.
The Commission was established on April 11, 1984. There is
also a Council composed of a President, who is a representative
of the government. He/she is assisted by two individuals
appointed by the Department of Labor (Secretar¡a de Trabajo y
Previsi¢n Social). The Commission is further composed of an
equal number (not less than 2 nor more than 5) of representatives
of workers and employers. (FLL Article 579).
The percentage is fixed by the Comisi¢n Nacional para la
Participaci¢n de los Trabajadores en las Utilidades de las
Empresas and is determined based on the annual income tax
statement filed by the corporate employer. The percentage was
fixed at 10% by decree published in the Diario Oficial dated
March 4, 1985. Article 25 of the Federal Tax Law provides that
employers may not lower their taxable income by deducting other
payments or contributions to workers. The percentage of the
workers' share in the profits will be taken from the taxable
income without making any deductions from the amount or
differentiating between types of enterprises, in accordance with
Article 586(V) of the Federal Labor Law. As a practical matter,
employers rarely share profits with their workers, finding
excuses allowing them to avoid paying out the profits and having
to pay taxes on those profits.
Workers may file objections to the statement presented by
the employer to the Secretar¡a de Hacienda y Cr‚dito P£blico.
The employer shall provide a copy of its annual statement to the
Secretar¡a within 10 days from the date of the employer's
submission of the statement. The annexes which accompany the
statement shall be made available to the workers for inspection
in the Secretar¡a and in the employer's offices for the next 30
days. The workers may not reveal the information contained
therein to third parties. Within the next 30 days, the
"sindacato titular" of the collective agreement or the majority
of the workers may present their position to the Secretar¡a. The
decision issued by the Secretar¡a may not be appealed by the
workers. Notwithstanding this provision, the workers may file an
amparo petition in accordance with Articles 103 and 107 of the
Constitution. There is case law tending to take jurisdiction
over these disputes away from the Secretar¡a, giving it to the
Conciliation and Arbitration Board.
Within 30 days from the date of the decision, the employer
must implement the Secretar¡a's decision, regardless of whether
the employer decides to challenge the decision. If the employer
is successful in challenging the Secretar¡a's decision, any
overpayment to the workers may be deducted from their share of
the profits the next fiscal year. (FLL Art. 121).
The appropriate share of profits must be distributed to the
workers within 60 days following the date on which the employer
must make its annual tax payment, even where there is a pending
objection interposed by the workers. (FLL Art. 122).
The following employers are exempt from the profit sharing
provisions of the FLL:
- new businesses, during their first year of operation
- new businesses dedicated to the development of a new
product, during their first two years of operation
- new mining enterprises during the period of exploration
- private charitable institutions, recognized by law, which
have serve humanitarian ends and are non-profit enterprises
- the Mexican Social Security Administration and public,
decentralized institutions serving cultural or charitable ends
- Businesses which have less capital than that set by the
Secretar¡a del Trabajo y Previsi¢n Social for certain branches of
industry. (Article 126).
Job Placement and Training:
Employment placement services for workers shall be free,
whether the service is performed by a municipal office, labor
exchange or other official or private institution. In offering
this service, the labor demand will be considered. All
conditions being equal, priority will be given to persons
providing the only income for the family. Constitutional
Article 123 (A)(XXV). Enterprises of all types are obligated to
provide training for their workers. Constitutional Article 123
(A)(XIII).
Housing for Workers:
Every enterprise, including agricultural, mining, industrial
or other, is obliged to provide comfortable and hygienic housing
for its workers. To meet this obligation, enterprises must pay
the National Worker Housing Fund an amount equal to five per cent
of the amount paid in worker salaries. (Article 136).The
National Worker Housing Fund is intended to create financing
systems that enable workers to obtain credit at low cost to
acquire property or to construct, repair or improve their
housing. (FLL Article 137). The resources of the Fund shall be
administered by a tripartite committee composed of
representatives of the labor force, employers and the government.
(FLL Art. 138).
Constitutional Article 123(A)(XII) establishes the
employer's obligation to provide its workers with comfortable and
hygienic housing by paying quotas to INFONAVIT. The Constitution
provides for the creation and maintenance of INFONAVIT. When the
work premises are situated outside of population centers, the
employer must establish schools, clinics and other indispensable
services. When the population of these centers exceeds 200
inhabitants, the employer must reserve a tract of land of not
less than 5,000 square meters for markets, buildings designated
for municipal services and recreation centers.
Worker's Compensation Benefits:
When workers suffer an accident or contract an occupational
disease, the employer must pay a corresponding indemnity, to
compensate the worker for his/her loss of earnings, whether the
injury resulted in death, or temporary or permanent disability.
Employers have this obligation even though they contracted for
the employee's services through an intermediary. Employers are
also obligated to comply with applicable norms regarding hygiene
and safety and to take the precautions necessary to prevent
accidents in the workplace, in order to protect the life and
health of its workers. Constitutional Article 123 (A)(XXIX).
Social Security Benefits:
Finally, Constitutional Article 123(A)(XXIX) provides for the
enactment of a social security law. Such law is considered to be
of public interest and is to include insurance against
disability, old age, life insurance, unemployment benefits,
against sickness and accidents, infant care services, and other
forms of insurance for the protection and well-being of factory
workers, rural workers and non-salaried workers and other workers
in other social sectors and their families. Similarly,
cooperative societies established for the construction of low-
cost and hygienic housing to be purchased by workers in
installments will be considered of social utility.
Suspension of the Employer-Employee Relationship:
Pursuant to FLL Article 42, causes for the temporary
suspension of the obligations of rendering services and of
payment are:
- The worker's contagious disease
- Temporary disability from a non-work related injury or
disease
- Imprisonment or arrest of the worker
- Appointment of the worker to the CAB
Rescission of Employer-Employee Relationship:
The employer or employee may rescind the work relation for
just cause at any time, without incurring liability. Just cause
for the employer to rescind the relationship include: employee
misconduct; falsification of qualifications (30 days only);
insubordination, drunkenness, immoral acts at workplace,
threatening the safety of other workers, breaching
confidentiality of trade secrets, excessive absenteeism (more
than 3 days in a 30 day period) without good cause. The
rescission must be communicated to the worker. (FLL Article 46).
The worker may appeal to the CAB. If the CAB finds there
was no good cause for the rescission, the worker shall be
entitled to back pay up to the date of the award, and to
reinstatement. There is no right to reinstatement where the
worker has been employed less than one year, the CAB determines
that it is impossible to establish normal relations, confidential
workers, domestic workers and seasonal/occasional workers. (FLL
Articles 48, 49).
The worker may rescind the relation without incurring
liability, if the employer has tricked the worker, threatened or
ill treated the worker, reduced the worker's salary, if the
worker failed to receive agreed upon payment employer's failure
to proved a safe workplace. The worker may leave his employment
within 30 days from the occurrence of the condition and will have
right to the compensation provided for in FLL Article 50.
Right of Indemnification (FLL Article 50):
If the employer has rescinded the work relationship without
good cause, the worker is entitled to compensation according to
the following scheme:
- If the worker was employed for a specified time less than
one year, he/she may receive compensation in an amount equal to
half the salary received for services rendered; if the employee
was employed for a specified time which is greater than 1 year,
worked for the employer for over 1 year, then he/she is entitled
to six month's salary for the first year of service and 20 days
of salary of each subsequent year of services rendered.
- If the relation was for an indefinite period of time, the
worker is entitled to compensation in the amount of 20 days'
salary for each year of services rendered.
- In addition, the worker will be entitled to three months'
salary and to back pay from the date of the dismissal up to the
date that the employer pays compensation.
In case of improper dismissals, to determine the amount of
the wage payable to workers, the employer must take into
consideration the integrated wage (namely, the base salary plus
the value of the bonuses, fringe benefits and in-kind benefits
contemplated in FLL Art. 84) with respect to the day on which the
right to such benefit commenced. Where the wage is fixed on a
weekly or monthly basis, it shall be divided by 7 or 30, as the
case may be, for the purpose of determining the daily wage. (FLL
Article 89)
In the case of salary paid on a piecework basis, and, in
general, where the worker's salary is variable, the daily rate
shall be the average amount of remuneration received over the
thirty days prior to the event triggering the right of
indemnification. If the worker's base salary had increased over
the thirty day period, the base salary will be the average of the
compensation obtained since the date of the increase.
Termination of the Employer-Employee Relationship (FLL Articles
53, 434):
The parties' relationship may be terminated for the
following reasons:
- Mutual consent
- The death of the worker
- Completion of the work or expiration of the term of
employment
- Physical or mental disability or incapacity of the worker
which renders it impossible for him/her to render services
- Acts of God (force majeur) not under the control of the
employer, or the employer's death or disability which renders the
termination of the work necessary, unforeseen costs, exhaustion
of mining materials, legally declared bankruptcy.
If the worker suffers a non-related disability, he/she is
entitled to one month's salary, plus 12 days' salary for each
year of service (in accordance with FLL Article 162) or, if
possible and desired by the worker, that other suitable
employment be found in addition to the compensation.
If termination by the employer is found to be without good
cause, the employee is entitled to the compensation set forth in
FLL Article 48.
Right to Strike:
Constitutional Article 123(A)(XVI) establishes the rights of
workers and employers to freely associate and organize in defense
of their respective interests.
Article 123(A)(XVII) guarantees the right of employees to
strike and establishes the right of employers to lockouts.
Lockouts are lawful only where a production surplus renders it
necessary to suspend production to maintain prices level with
costs. Prior approval of the lockout must be obtained from the
local Conciliation and Arbitration Board.
Strikes are lawful when they have as their purpose the
attaining of an equilibrium among the various factors of
production, harmonizing the rights of labor with those of
capital. If the strike is in the area of a public service, the
workers must give the Conciliation and Arbitration Board 10 days
advance notice as to the date agreed upon for the suspension of
work. Constitutional Article 123 (A)(XVIII).
Strikes will be considered unlawful when the majority of
workers engage in acts of violence against persons or property,
or in the event of war, when the workers work for establishments
or services of the government.
Adjudication of Labor-Management Disputes:
Disputes between employers and employees are subject to the
decisions of a Conciliation and Arbitration Board.
Constitutional Article 123(A)(XX). The Board shall be composed
of an equal number of representatives of workers and employers,
with one government representative. If an employer refuses to
submit the dispute to arbitration or to accept the decision of
the CAB Board, the labor contract shall be considered terminated
and the employer will be required to indemnify the worker in the
amount of three months' wages. Constitutional Article
123(A)(XXI). The employer shall also incur any liability arising
from the dispute. This provision is not applicable in the case
of actions covered in which the following refusal is made by
workers, the labor contract shall be considered terminated.
An employer who dismisses a worker without justifiable cause
or because he has entered an association or joined a union, or
for having taken part in a lawful strike, shall be required, at
the election of the worker, to fulfill the employment/labor
contract or to indemnify the worker in the amount of three months
wages. The law specifies those cases in which an employer may be
exempted from fulfilling the contract by payment of an indemnity.
The employer must also pay a worker three months, wages if
the worker is forced to leave his/her employment due to the
employer's lack of honesty or because of ill treatment by the
employer or the employer's extended family. An employer remains
liable even where the ill treatment is attributable to his
subordinates or to members of the employer's family acting with
his consent, express or implied.
Wages or salary earned by workers and indemnity compensation
shall have priority over all other obligations of the employer in
the event of receivership or bankruptcy. Constitutional Article
123(A)(XXIII).
An employee is solely responsible for debts which he/she
contracted and which are payable to the employer, his associates,
members of the employers family or the employer's dependents.
Payment of the employee's debt may not be exacted from members of
the worker's family, nor can the debt be demanded for an amount
exceeding the wages of the employee for one month.
Constitutional Article 123(A)(XXIV).
Civil and Criminal Penalties:
FLL Article 993 provides that penalties for violations of
the law are administrative and pecuniary. The basis for
calculating the fine is the applicable minimum salary. FLL
Article 993 provides that a fine of 15 to 155 times the minimum
wage will be imposed on the employer who does not comply with
Article 7, the norm determining the minimum percentage of Mexican
workers in the company or enterprise.
Article 994 provides that a fine of 3 to 155 times the
minimum wage will be imposed upon an employer who violates Arts.
61 (maximum work day), 69 (weekly day of rest), 76 (The vacation
period due to permanent workers) and 77 (The vacation time due to
noncontinuous and seasonal workers). Violation of the employer's
obligation to share in the distribution of profits (Article
123(IX) of the Constitution and Arts. 117 to 131 of the FLL) will
carry a fine of from 15 to 315 times the minimum wage. A penalty
of 3 to 95 times the minimum wage will be imposed upon the
employer who fails to comply with certain general obligations
such as the obligation to maintain a safe workplace, to grant
proof of services, to permit the performance of citizenship
obligations, to provide the two-weekly proofs and to establish
the Article 123 schools.
A fine of 3 to 155 times the minimum wage will be imposed on
employers who violate the norms relating to the work of women and
minors. (Art. 992) Non-performance over the course of one week
of the norms related to remuneration of work and time off
contained in a collective agreement will be punished by fines of
15 to 315 times the minimum wage. If the non-performance
continues for two or more weeks, the fines will accumulate, but
the fines will increase by 25%. (Article 1000)
Shipowners, shipping companies or charterers have the
obligation to provide their workers with healthy, abundant food
when passengers are provided with food, or when they sail for
more than six hours or are in an unpopulated place. Such
violations are punishable by a fine of 3 to 31 times the minimum
wage. (Article 996) If there is a refusal to repatriate the
worker or transfer the worker to the contracted place in
accordance with Article 204(IX), Article 996 imposes a fine of 3
to 155 times the minimum wage against the non-performing
employer.
An employer who violates the norms protecting field workers
(Arts. 311 to 330) or domicile workers (Arts. 311 to 330) may be
fined from 15 to 155 times the minimum salary. (Article 997)
With regard to domestic workers, an employer has the obligation
to provide a domestic worker who lacks education attendance at a
primary school. An employer who violates this provision may be
fined 3 to 15 times the minimum wage.
Article 1001 provides that a fine of 3 to 30 times the
minimum wage will be imposed on an employer who violates the
norms contained in the International Labor Regulation.
The Federal Labor Law does not provide any criminal
penalties, nor does it provide for injunctive relief.
In contrast, the Fair Labor Standards Act, provides for
civil and criminal penalties and injunctive relief for violations
of the provisions in the Act. 29 U.S.C. 215 sets forth certain
prohibited acts, including violations of 29 U.S.C, 206, 207,
211(c)and (d), 212 and 214.
29 U.S.C. 216(a) provides that "any person who wilfully
violates any of the provisions of Section 215 will, upon
conviction, be subject to a fine of up to $10,000 or imprisonment
of up to six months, or both. The penalty of imprisonment may
only be imposed for an offense committed after the conviction of
such person for a prior offense under Subsection 216. An
employer who violates Section 206 or 207 will be liable to the
employee for the amount of unpaid minimum wage or overtime
compensation due and for an equal amount as liquidated damages.