Mexico: Labor Law Agenda for 2021

Mexico will continue its process of change towards the new labor model, so the Labor Agenda for 2021 contemplates various topics that include the application of regulations, the implementation of the Second Stage of the Labor Reform and fundamental legislative changes, such as the initiative to regulate outsourcing.

 

  1. The First Stage of the labor reform went into effect in November in 8 states of Mexico (Durango, Zacatecas, San Luis Potosi, Hidalgo at the federal level, State of Mexico, Campeche, Chiapas and Tabasco) which implies that in those entities the local boards were closed and the representations of the Federal Conciliation Center were opened.

At the same time, the Labor Courts were opened.

This implies that the Conciliation and Arbitration Boards will stop receiving cases and will dedicate themselves to reducing the backlog of cases.

 

  1. In 2021 the Ministry of Labor and Social Welfare plans to implement the Second Stage of the reform in 13 other states (Baja California, Baja California Sur, Colima, Aguascalientes, Guanajuato, Querétaro, Guerrero, Puebla, Tlaxcala, Morelos, Veracruz, Oaxaca and Quintana Roo). And the rest of the entities will begin their transition in 2022, including Mexico City.

 

  1. At the same time, the unions will have to carry out the procedure of legitimizing their collective bargaining agreements, through elections in which the workers cast their personal, free, direct and secret vote to validate these contracts. The term established to comply with this obligation is May 2023 to carry out this procedure and said procedure will be fundamental for those companies that export to the United States and Canada.

 

  1. The Mexican Congress approved new legislation to establish teleworking (home office) as a new form of labor relations and its obligations must be contemplated in the individual and collective contracts and internal regulations. Derived from the above, new obligations are established for employers, such as

– To provide, install and take care of the maintenance of the necessary equipment for teleworking such as computer equipment, ergonomic chairs, printers, among others.

– Receive the work in a timely manner and pay the wages in the form and on the dates stipulated.

– Assume the costs derived from the telework, including, if applicable, the payment of telecommunication services and the proportional part of electricity.

 

  1. The entry into force of the Mexican Trade Agreement with the United States and Canada (USMCA) on July 1, 2020 constitutes an additional pressure to comply with the terms of the Labor Reform, because Mexico committed to respect the principles of freedom of association and collective bargaining in the Agreement.

There is a latent possibility that the United States will file complaints against certain Mexican companies for non-compliance with these principles. An example of the scrutiny being applied to Mexico is the report of the Board of Independent Labor Experts, which warned that the country needs to take further action to comply with the obligations contained in the USMCA. It noted that the so-called protection contracts are still in force. The report also mentioned acts of violence and intimidation in workplaces.

 

  1. In addition to these issues, the reform project to regulate outsourcing is pending in Congress.

The federal executive sent a proposal to the Chamber of Deputies, where outsourcing is prohibited and only specialized work is allowed.

The private sector showed its disagreement, among other reasons because not all outsourcing is carried out illegally. The Federal Government and the Business Coordinating Council signed an agreement to eliminate all abusive forms of subcontracting, while the discussion of the reform resumes in Congress in February 2021.

At the same time, the possibility of capping profit sharing is being discussed, as a way to compensate for the fact that subcontracting has been eradicated.

 

  1. Employers are faced with a complicated panorama, because they must adapt to the health measures to confront the COVID-19 and the changes in their labor dynamics. Mainly in the face of the need to protect their vulnerable personnel while having to cover their salaries in full.

 

  1. In addition, the work centers are also in full application of the second phase of Standard 035 (Norma-035), which speaks of psychosocial risks and the promotion of a favorable organizational environment.

In the first phase, which began on October 23, 2019, workplaces had to establish prevention measures; identify workers exposed to severe traumatic events and disseminate information among their staff.

In October 2020, the second phase began, which includes the identification and analysis of psychosocial risk factors, the evaluation of the organizational environment, control measures and actions, as well as the practice of medical examinations. The obligations vary according to the size of the company.

 

  1. Employers and the government engaged in an arduous negotiation on the increase to the minimum wage, which will be in the northern border free zone of 213.39 pesos and in the rest of the country of 141.70 pesos, an increase of 15%, effective January 1, 2021. It is estimated that this increase could complicate future salary negotiations.

As you can see, the Mexican labor scenario for this year is loaded with complex issues and we are prepared to address each of them based on our experience.their salaries.

 

Sources: Deloitte Touche Tohmatsu Limited, www2.deloitte.com/mx/conozcanos –

                   Galaz, Yamazaki, Ruiz Urquiza, S.C., 2021.

 

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