For years, talking about labor rights in Mexico was talking about pending business. Long hours, minimal vacations, lawsuits that seemed to go on forever. Work changed, but the law lagged behind.
That gap only began to close in the last decade. Not in a single stroke, but through a series of adjustments that, taken all together, started shifting a structure that had been intact for a long time.
The reforms
The Federal Labor Law remained virtually untouched for years. Rights such as the year-end bonus and the seniority bonus were incorporated in 1970 and then came a long silence. More than 40 years without significant reforms, while the labor market had already changed.
There was a first attempt at catching up to the times in 2012. Concepts such as trial periods were brought into play, and subcontracting was regulated for the first time. A limit was also set on accrued salaries in labor lawsuits, which could go on forever.
It was progress, but only in part. Labor justice continued to be slow, and the union model remained intact. This is why the impact was different upon the arrival of the reform of 2019. For Óscar de la Vega, labor lawyer and partner at the De la Vega & Martínez Rojas Law Firm, the logic did change in this instance.
“(This reform) caused a profound transformation in labor justice by eliminating the boards and creating new courts. From the regulatory standpoint, it was a true watershed in the history of labor in the country.”
Before that year, solving a dispute could take years. With the reform, conciliation became mandatory; that is, before filing a lawsuit, the worker and the company must try to reach an agreement, which reduced times and changed the way of handling disputes.
The reform also addressed something that had operated in the shadows for years: union representation. Before, many workers did not know who it was that was negotiating their conditions. With the legal changes, collective bargaining agreements and union leadership became subject to personal and secret voting.
“Protection contracts were sought to be eliminated, and the objective was that workers’ participation become real”, De la Vega explains.
The path for the increase of the minimum wage started in 2019, when the federal government changed the policy on wage restraint and opted for continuous year-on-year increases with the objective of recovering purchasing power after decades of lagging behind.
Other adjustments, that were less spectacular, but closer to the daily realities of work, came later. In 2021 subcontracting, better known as outsourcing, was limited to specialized services. The objective was to put a stop to schemes that simulated employment relationships, although this change caused many companies to reorganize entire contracts and payrolls.
Teleworking or home office also ceased to be an improvised agreement. The law started demanding clear regulations on tools, costs and disconnection times, and working from home became a work modality with rights.
Then came changes that can seem small, but speak volumes about the accumulated lag. Minimum vacations were increased from six to twelve days, starting from the first year on the job. And the number of vacation days continues to grow gradually as the worker gains seniority. Mexico thus corrected one of its greatest gaps versus other OECD countries.
The law denominated as the Chair Law entered into force in June of 2023 and forced employers to offer ergonomic seats and rest periods to people who work on their feet. This is something basic in many economies, but wasn’t guaranteed in Mexico.
At the same time, the minimum wage continued increasing. The 13% increase projected for next year shows a trend that has improved incomes, even though it has also brought tension to the discussion on labor costs and formality.
And, speaking about discussions, the reduction of the number of work hours has been on the table since the last presidential term. Since then, it has generated debate among companies, unions, and specialists, not only due to the impact on the number of hours worked, but also because of its impact on costs, productivity, and formality.
Unlike other recent reforms, this one has a direct impact on the manner in which work is organized in the majority of sectors; therefore, it has been the subject of constant discussion, even before becoming a formal proposal.
The federal proposal for reducing the labor workweek to 40 hours considers a gradual implementation starting in 2027; that is, a transition by stages in order to enable companies and sectors to adjust progressively, without salary cuts.
Halfway there
From the legal point of view, progress is made, but there is still a way to go. “Today, the labor framework in Mexico already incorporates international standards”, De la Vega points out “But we are still only halfway there.”
The distance is made evident when work hours are compared. In Mexico, people work more than 2,200 hours per year per person. The average in the OECD is of around 1,700 hours. And it is even lower in countries like Germany or France. It is not only a difference in hours, but also a difference in the model.
