Mexico is broadly known for being heavily protectionist towards the worker as it pertains to the state’s labor law. Many U.S. and European companies rely on third party headhunting firms for recruiting executives in Mexico and to provide the proper guidance through the candidate search and hiring process.
The Mexican Federal Labor Law (FLL) is the legal framework that governs all employment relationships in Mexico. This law was enacted in 1970 and updated with the new reform in 2012. Other laws regulating employee relationships to look out for are: Safety and Hygiene Legislation, and finally the Mexican Constitution. This article will help you understand the hiring process and applicable labor laws in Mexico.
How to hire foreign employees in Mexico?
Here are five essential tips that will help your business when employing foreign workers in Mexico.
Working visa for foreign employees: Foreign employees may just make up 10% of the business labor force in Mexico and the company must be officially registered to legally hire foreign employees. Businesses need to take into account that all provisions related to the working visa must be facilitated by the employer; this includes applying for a work permit with the INM (Instituto Nacional de Migración).
For the work visa application for a foreign employee, the company has to meet the following requirements:
- Original and copy of the official valid identification of the individual or entity’s legal representative, public agency or deconcentrated body, decentralized body, company with state participation or public trust. Embassy or Consulate of a country with representation in Mexico, in case of a Mexican, or valid residency card in case of a foreign person.
- That the foreign person for whom the visa is required, does not have a visa request of temporary residency or visitor with a permit to perform paid activities, requested by the Institute through a job offer pending of resolution.
- Original job offer with letterhead page which states the occupation that the foreign person will perform in accordance to the classification of the National System of Classification of Occupations or the one that at some moment will supersede this system. The original offer should also state time required, workplace and amount of compensation.
- Copy of the employer registration statement before the Institute.
- Legible copy of the passport or document of identity and valid travel document in accordance to the international law for the foreign person which applies for the visa.
For the complete application process, please visit the link: Visa by Job Offer
Hire a third-party job recruitment agency: Since complying with Mexican labor and social laws can be obscure and complex, many companies choose to execute the process through a third party job recruitment agency. This will alleviate much of the burden of understanding the fine print and technicalities of hiring top executives in Mexico. Executive search firms may leverage their existing network to provide you with a list of pre-qualified potential employees.
Duties and hiring practices in Mexico: Employer obligations with respect to the worker include (but aren’t restricted to) the following:
- Entering into a proper worker agreementthat is written – This will help clarify any mutual expectations and protect the employer against any possible lawsuit.
- Complying with all laws – Comply with all labor and social laws to avoid hefty fines from regulatory agencies.
- Paying wages weekly or bi-monthly – Most companies in Mexico pay their employees every 15 days. However, it is not uncommon in other countries to have payouts every month. Before setting a payment schedule, it is recommended that employers check with local businesses to understand their employer / employee culture.
- Collecting and paying social security tax, National housing fund (Infonavit) contributions, and retirement contributions – Be sure to pay all regulatory agencies pertaining to doing business in Mexico. If agencies are not paid on time, they may close your business temporarily until payments are reconciled and up to date.
- Providing all accommodations and benefits required by the Mexican labor law – Adhere to best job practices and provide all benefits required by the Mexican labor law; this includes, a minimum of 15 days Aguinaldo (Christmas bonus), Seguro Social-IMSS (public health access), a minimum of 6 days’ vacation for the first year and an additional vacation premium of 25%.
- Supplying gear and appropriate tools – Provide the equipment and tools needed to maintain your employees safe. The last thing any business wants are accidents arising from negligence.
- Executing appropriate health and security protocols – Always be aware of the health and security protocols. It is recommended to have a person on staff that oversees that all laws, regulations and protocols are met to avoid any conflict with employees or government agencies.
Employment agreements: According to the Mexican Labor Law, all employer and employee work relationships must be agreed to in writing. Even if the worker does not ask for an agreement, it is important that you have one to comply with Mexican government law. Also, an agreement will help clarify the obligations, roles and expectations resulting from this relationship. Bear in mind that should a litigation case or lawsuit appear, the burden of proof is going to be on the company. To be specific, it is suggested that the employee agreement provide specific details regarding the following:
- Date of employment
- Working hours
- Vacation and Holiday pay and provision
- Termination causes
- Specifying appropriate termination process and repatriation of employee to their country of origin.
Background checks: When hiring in Mexico, it is important that employers conduct background checks and verify references. Here are some guidelines.
- Citizenship or Immigration status: It is required that an employer ask about immigration status and to resolve all migratory issues before hiring a foreign candidate. Penalties and fees and even deportation is a consequence of illegal workers hired by employers in Mexico. Employment may not be denied due to race, religion, etc.
- Criminal records: Employers can ask any candidate regarding their criminal record and can also conduct legal searches with applicable authorities. Typically, a letter confirming “non-criminal activity” can be issued by the Mexico local police station, as a digital centralized system is not functional in Mexico. For foreign workers, we recommend that criminal records be verified in their country of origin. Most countries like the United States and Canada have a centralized digital database.
- Credit checks: Credit checks can be conducted with Mexican national credit check financial institutions. However, for foreign employees, it is recommended to conduct credit checks in their country of origin.
- Medical history: Employers are able to ask any candidate regarding their medical history.
- Drug screening: It is acceptable to have employers require drug screening. A waiver should be signed by the potential employee. However, the results must be kept confidential. The employer may not deny the potential employee solely on the basis of a positive result.
- Social media: In Mexico, social media is considered private information and direct involvement by the employer could be considered a legal offense.
If you need additional guidance about hiring talent in Mexico for your organization, don’t hesitate to contact us at firstname.lastname@example.org
About the Author:
CEO & Founder of Barbachano International (BIP) the Human Capital Solutions leader in Mexico, Latin America and the USA offering high impact executive search, executive coaching and outplacement. Directly and through our partners we have offices in Mexico, USA, Canada, Brazil, Argentina, Colombia, Chile, Peru, Uruguay, and Paraguay. Our corporate offices are in San Diego, California. Phone: 619-427-2310. Visit us at www.bipsearch.com.