Mexican Workers Will Get Double Paid – Courtesy Mexico’s Senate of the Republic?
Karma Management has now become Karma Management Global Consulting Solutions Pvt. Ltd. which was incorporated in the year 2004, and has now completed almost 18 years of its existence.
As late as April 2021, Karma Global took a very bold step of venturing into foreign shores in terms of shoving up its business prospects in countries like the US, the UK, UAE, Canada, the Philippines, and South East Asia.
It has already made its mark in terms of providing excellent services in the areas of payroll, outsourcing, recruitment and talent acquisition, unions, negotiations, immigration, facility management services, and regulatory compliances including employment contracts in these foreign countries as well.
In fact, the CVO and MD, Pratik Vaidya of Karma Global was selected by SME Forum earlier this year, to lead a Select US Summit where he took along a delegation of over hundreds of SME Members for business discussions with the authorities in the States as well as with the entrepreneurs and Innovators of many countries who were present in this forum.
Few months back, Pratik Vaidya, CVO & MD of Karma Management Global Consulting Solutions Pvt Ltd went on a Europe tour, participating along with Advantage Austria and brainstorming on the ecosystem of Start-ups in Salzburg, Austria, besides the regular business visits to UK and UAE.
Karma Global thus entails the compliances of global clients in these countries as well, and in keeping with the global scenario, it does keep a very hard track on the status of global compliances all around the world and especially so, it keeps an update on what is happening around the Universe as far as people, wages, work, benefits, employment contracts, minimum wages, negotiation and unions are concerned across the globe.
Mexico: Lawful Actions for Employers to Make New Changes to Labour Reforms Regarding Vacation Days?
IN BRIEF?
On December 14, 2022, the Mexican Senate approved a decree by which articles 76 and 78 of the Federal Labour Law (“Law”) was amended regarding vacation days. The purpose of the amendment is to extend the number of vacation days in the private sector and provide employees with certain prerogatives to allow them to enjoy their vacation periods consecutively.
The reform decree was sent to the executive power for publication in the Mexico Federal Official Gazette (DOF). It will become effective on January 1, 2023, or the day after its publication.
RECOMMENDED ACTIONS FOR EMPLOYERS
By the reform’s effective date, employer’s must
- review the seniority chart of their employees,
- review the number of vacation days each employee is entitled to base on seniority,
- and confirm that their vacation policies comply with the new provisions. Specifically, employers will be required to:
Review collective bargaining agreements and individual employment contracts to confirm compliance and update applicable vacation days
Perform an analysis of the seniority of their employees, and the number of vacation days each employee is entitled to base on seniority at the time of the publication of the reform decree
Define an action plan for the granting of vacations in accordance with the dates on which employees must take their vacation
The reform establishes the minimum consecutive number of days to be taken by employees. However, it opens the possibility of employees and employers agreeing on when vacation days can be taken so that vacations do not affect the companies’ operations.
Karma Global Tech Management LLC does a lot of work on the immigration of foreign workers in the US and is looking out for opportunities to expand in Mexico with experts already identified. Karma Global will gladly assist you in navigating and implementing this new law, including creating an action plan and steps to follow for determining and granting the vacation periods applicable in your workplaces.
TABLE OF NUMBER OF DAYS FOR VACATION – EACH INCREASING YEAR IN SERVICE
The amendment to the Law provides for an increase from six to twelve working days of paid annual vacation for employees with more than one year of service, which will increase by two working days, up to twenty, for each subsequent year of service.
After the sixth year of service, the period will increase by two days every five years. For a detailed explanation, see below:
| Years of service | Vacation days before the reform | Years of service | Vacation days after the entry into force of the reform |
| 1 | 6 | 1 | 12 |
| 2 | 8 | 2 | 14 |
| 3 | 10 | 3 | 16 |
| 4 | 12 | 4 | 18 |
| 5-9 | 14 | 5 | 20 |
| 10-14 | 16 | 6-10 | 22 |
| 15-19 | 18 | 11-15 | 24 |
| 20-24 | 20 | 16-20 | 26 |
| 21-25 | 28 | ||
| 26-30 | 30 | ||
| 31-35 | 32 |
The amendment also provides that employees shall enjoy at least twelve continuous days of vacation, which, at the employees’ discretion, may be distributed in the manner and time required. Before the amendment, the law only provided for six continuous vacation days, without including any additional entitlement for the employees.
The provisions of this reform will apply to individual or collective bargaining agreements in force on the reform’s effective date, if they are more favourable to employees’ rights.
Finally, it is important to clarify that the statute of limitations provisions have not been changed. Therefore, the provisions of Articles 81 and 516 of the Law will continue to apply. In other words, vacations that have not been taken within the 18 months following the year of employment of each employee will be subject to the statute of limitations. Likewise, the vacation premium of 25% of the salaries corresponding to employees during the vacation period has not changed.
SENATOR NAPOLEON’S VIEWS
The president of the Labour and Social Welfare Commission, Senator Napoleon Gómez Urrutia of the Morena party, explained that the bill seeks to guarantee more time off for rest and recreation. “Work is one of the many components of a full life. In the same way, we need free time for our personal development,” he said.
VIEWS OF THE WORLD AND COMPARISON THERETO
The current legislation has not been amended in 52 years, placing Mexico as one of the world economies with the shortest initial annual leave. According to data from the World Policy Analysis Centre, this is only comparable with countries like Brunei, Malaysia, Uganda, the Philippines, and Thailand. It is also way below the International Labour Organization’s (ILO) recommendation of at least 18 workdays based on a statutory six-day workweek.
Under the current scheme, it would take a worker in Mexico 45 years of service in the same company to equal the vacation period to which the labour force in Brazil or Panama is entitled from the first year of work.
At the same time, the World Health Organization has reported that Mexico ranks highest in the world for levels of work-related stress. These statistics go in hand with those from the Organization for Economic Cooperation and Development (OECD), which places Mexico as one of the member states with the highest working hours but one of the least productive.
The project was proposed in September by Citizens Movement Party Senator Patricia Mercado and will next go to the lower house of Congress for a final vote. If approved, it will bring Mexico closer to meeting the ILO’s recommendation and could also increase productivity. “The issue at hand seeks to ensure that workers participate in productivity gains through better wages and more leisure time,” said Gómez Urrutia.
Assuming the bill goes on to become law, the new legal terms would affect all valid individual or collective work contracts at the time of the law’s entry into force, which is estimated for Jan. 1, 2023, or the day after its publication.
CONCLUSION:
Disparities in national minimums around the world are still a subject of debate regarding work-life balance ……!
In the majority of nations, including all industrialized nations except the United States, advances in employee relations have seen the introduction of statutory agreements for minimum leave from work —that is the amount of entitlement to paid vacation and public holidays. Companies may offer contractually more time. Companies and the law may also differ as to whether public holidays are counted as part of the minimum leave.
Disparities in national minimums are still the subject of debate regarding work-life balance and perceived differences between nations. These numbers usually refer to full-time employment – part-time workers may get a reduced number of days. In most countries, public holidays are paid and are usually not considered part of the annual leave. Also, in most countries there are additional paid leave benefits such as parental leave and sick leave that are not taken into account over here.
A few years earlier, the International Labour Organization held a Tripartite Meeting of Experts on Non-Standard Forms of Employment that assembled experts nominated after consultation respectively with governments, the Employers’ group, and the Workers’ group of the Governing Body, to discuss over four days the challenges for the decent work agenda that non-standard forms of employment can generate.
The conclusions of the meeting called on member States, employers’ and workers’ organizations to devise policy solutions to address decent work deficits associated with non-standard forms of employment so that all workers – irrespective of their employment arrangement – could benefit from decent work. Specifically, governments and the social partners were requested to work together to implement measures to address inadequate working conditions, support effective labour market transitions, promote equality and non-discrimination, ensure adequate social security coverage for all, promote safe and healthy workplaces, ensure freedom of association and collective bargaining rights, improve labour inspection and address highly insecure forms of employment that do not respect fundamental rights at work.
The International Labour Office, the Secretariat of the Organization, was asked to support these efforts, however, nothing much has changed except in bits and pieces, with the launching of some initiatives while the world of work goes forth facing new challenges and hardening of old ones.
Earlier last month, we saw in Canada a beautiful thing to happen in the light of the Minister of Employment’s statement reproduced below:
“Everyone deserves to work in dignity, in safety, and in health. With these changes, the Canada Government is strengthening protections for temporary foreign workers. These individuals come to Canada and work for Canadian businesses, and help drive the Canadian economy forward. We have a responsibility to ensure they are protected and respected.”
The Government of Canada takes its responsibility to protect temporary foreign workers (TFWs) very seriously. Ensuring the health and safety of these workers while they are in Canada is a key priority, and the Government is taking concrete action to better support them.
Karma Global while dealing with all such issues and cases, always takes the approach to act trustworthily and to be compliant with the laws of the land.
Karma Global always advises its clients to be on the good side of the law and to abide by the same. In this respect, it offers a plethora of excellent services in terms of documentation compliance and validity of licenses for running the business and also supports establishments and union-afflicted workers to take a just stand on issues, in the company’s interest and not on trivial grounds just for the sake of it, to show the level of aggression.
Respect for all fundamental principles and rights at work (FPRW), including freedom of association and the right to collective bargaining, is an essential foundation of the ILO and key to successful policy and decision-making. As the world of work is changing at an ever-increasing pace, strong, influential and inclusive social dialogue is, and will be, a key vehicle to shape the world of work that we want.
Karma Global’s integrated regulatory compliance services run on a piece of expert machinery that is agile and consistent and is simplified for the global clients in a manner that they can easily grasp the subject matter as against the tangled complexity and risk, which gives the global clients the power of confidence and control.
Karma Global is well aware that the lengthening list of supranational regulations is a burden enough for any multinational business, while each jurisdiction implements its regime with its own unique local twists, creating a maze of localized regulations.
Also, it is universally known that compliance timelines are always tighter given the stipulated dates. Sometimes simple oversights on the part of the employers can threaten to damage reputations and jeopardize operations and therefore, such Organizations like Karma Global make it a point to reach out to employers and establishments struggling with compliance in order to keep pace with them so that staying compliant and in good standing with the Government’s rules, across the entire operational footprints is made simpler and easy by Karma Global.
We have the reach and resources to be your global partner in regulatory compliance management, easily transforming all regulatory uncertainties into clarity and control.
Our global regulatory health checks, conducted by our teams of local experts, can evaluate your current regulatory standing across every market and solve the country-specific challenges they find.
With our finger permanently on the regulatory pulse – monitoring supranational regulatory schemes and the innumerable pieces of local legislation that give them the force of law – we make sure there are no surprises.
We expertly classify, register, document, assess, review and report across all your regulatory obligations, leaving you free to focus on the business end.
Our deep, country-by-country knowledge, expressed through a 200 -strong network of local offices makes light work of the most intricate local and global reporting obligations.
For clients facing urgent one-off regulatory challenges – perhaps a major cross-border KYC exercise for a time-critical international deal – we can scale up quickly and easily thanks to a flexible structure and global resource base.
Proprietary blog of Karma Global Tech Management LLC
This blog has been collated and compiled by the internal staff of Karma Global with the knowledge and expertise that they possess, for its monthly newsletter Issue 07 of January 2023 and in case of specific or general information or compliance updates for that matter, kindly reach out to the Marketing Team – Kush@karmamgmt.com / yashika@karmamgmt.com