News, Insights and Best Practices for Manufacturing in Mexico

Work Week and Payroll Factors in the Mexican Labor Law

   
13 Mar 2017

Category: Labor & Economics, Manufacturing in Mexico

Mexico's work schedule operates on a specific standard that generates flexibility within the work week. The intricacies of employee overtime, termination, resignation, and retirement payments are based off of Labor Law stipulations and cooperate with government standards. These are just a few factors of the Mexican Labor Law.

The Mexican Work Day

According to Mexican labor law, the legal length of the Mexican work week depends upon the shift on which an employee renders service.  The number of hours attached to each shift is spread over a six day work week that runs from Monday until Saturday. The Mexican work day is divided into three shifts:

  • The day shift for a Mexican worker is eight hours in length. These hours can fit flexibly within the period of 6:00AM to 8:00PM.  The number of hours per spend on the job by Mexican day shift laborer is 48 hours.
  • The night shift in Mexico occurs during a seven hour period worked between 8:00PM and 6:00AM.  The number of hours constituting the night shift amount to forty-two.
  • The mixed shift in Mexico is for a period of 7.5 hours, and can consist of hours that are considered part of the day shift and part of the night shift.  The night shift component of a mixed shift is limited to 3.5 hours .

As per Mexican labor law, workers are entitled to a thirty minute meal break during each shift.  In addition to his, many companies in Mexico provide additional break time in order to help workers to focus and to remain fresh.  Download our FREE Ebook on Mexican Labor Laws and answer important questions  about Mexican employment! 

Mexican Employee Payroll Factors

Mexian-Labor.jpgOvertime

Average wages in Mexico for direct labor manufacturing come out to around $5.83 a day, minimum in one of our parks.  Each workweek shift is provided with the same pay, accounting for the differences in the number of hours worked in the day, night and mixed shift schedules. Overtime is paid after the Mexican workers reach the legal number of hours stipulated for their shift.  After this prescribed number, workers in Mexico are paid double for the first additional 9 hours, and then triple the rate of his or her normal salary.

Termination

Under Mexican labor law if an employee is terminated, they have the right to file for reinstatement or compensation, and are provided 3 months of wages beginning at the time of dismissal. Until the wages are provided, normal wages accumulated during the days after the event are required to be given. If the file for reinstatement is approved by the courts the employee will receive all the wages that would have been earned throughout the process - the 2012 Mexican Labor Law reform changed the compensation process to limit up to 12 months and a 2% monthly interest over 15 months of salary because of the excessive delays in court proceedings.

Resignation

When an employee resigns, the employer has to pay the employee the balanced part of the vacation premium and a year-end bonus. If the employee worked for less than one year, the employee is compensated for half of the time they worked. If this period is greater than one year, then the compensation is equal to six months salary of the first year, and 20 days per year for each of the following years. If the employee worked for more than 15 years they receive an additional 12 days salary for each year they worked (calculated on the last salary received prior to resigning). Also, when someone is hired, a personal “AFORE” savings account is created and 2% of their salary for retirement is deposited.

INFONAVIT

Employees go through INFONAVIT to qualify for a housing loan where 3% of the salary is sent to INFONAVIT (Instituto Nacional para el Fomento a la Vivienda para Trabajadores, or, The National Institute for Development of Living Quarters for Workers) on a monthly basis to support the housing loan.  The percentage is also used to create small housing communities for the worker population.  

Click here to get the scoop on manufacturing in Mexico!

The Mexican work week and employee payroll regulate work hours through shifts and overtime, and provide a standard for employee schedule and productivity. Basic payroll structures follow industry and government standards that carry-out pay for specific events throught the employee's career. 

 

Related posts