Num. 2021-21 | Labor Law
LEGAL ALERT: Increase of the Minimum Wage, 2022.

Starting on January 1st, 2022, the general minimum wage in Mexico will increase as follows:

  1. From $141.70 pesos per day to $172.87 pesos per day in the entire country with the exception of the free zone located on the northern border of the country, and
  2. From $213.39 pesos per day to $260.34 pesos per day in the free zone, located on the northern border of the country.

The free zone in the northern border of the country includes all the cities located in a strip of land of 25 kilometers of the border with the United States of America.

It is important to note, that the minimum wage for professionals will increase by 22%, depending on the profession or activity.

In addition to the above, deriving from the salary increase, the social cost of the operations of the companies will increase. Some of the concepts that will increase are:

  1. Labor indexed premiums or bonuses.
  2. Social Security premium.
  3. Housing premium.
  4. Savings funds.
  5. Employment benefits, and
  6. Ordinary or extraordinary labor unions premiums or fees.

It is very important that employers are aware that the reduction of the salary to an employee or the unilateral elimination of the labor benefits, is prohibited by the Federal Labor Law. Employers should be cautious with the strategies that may be implemented to impact the minimum wage increase, due to the fact that such strategies may result in labor rescission claims, labor inspections, or fines that could generate significant costs to the employers.

Our labor law specialists will be glad to assist you and answer any questions that you may have relating to this matter or any other legal aspect that may have any implications for your company or organization.

We remain at your service.

For any questions or comments, please do not hesitate to contact us.

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

New deadline for the implementation of the outsourcing labor reform

On July 31, 2021, the Federal government published an extension to implement the outsourcing and employee profit-sharing reform.

The new deadline for transferring employees and apply for the registry as a specialized services company is August 31, 2021.

RECOMMENDATIONS FOR THE EXTENSION

  • Review the operations between companies of the same corporate group to determine if it is necessary to restructure the corporate operations.
  • Analyze and review outsourcing agreements to determine the actions that need to be taken.
  • Analyze the insourcing services to confirm compliance with the requirements and conditions and implement the corresponding registry.
  • Analyze the contracts for specialized services or works and ensure they do not involve activities related to their corporate purpose or economic activity.
  • Surveillance and ensure that the specialized services register (REPSE).

For any questions or comments, please do not hesitate to contact us.

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

COVID-19 Vaccinated people are no longer considered vulnerable

On July 27, 2021, the Ministry of Health published in the Federal Official Gazette the “Executive Order by means of which the dissemination of the new traffic light methodology by regions to evaluate the epidemiological risk represented by the serious disease of priority attention COVID-19 is disclosed.”

The relevance of the publication is the following:

  • The traffic light by regions to assess the epidemiological risk will be announced on the following website: https://coronavirus.gob.mx/semaforo/
  • People to whom the Covid-19 vaccine has been administered will not be considered vulnerable once two weeks have elapsed after the application of the last dose.

WHAT DOES THIS MEAN?

Although the publication does not explicitly state it, it implies that employers may request proof of vaccination to:

  • Their vulnerable employees (or, in its case, request that they get vaccinated).
  • Job applicants.

For any questions or comments, please do not hesitate to contact us.

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

Inter account bank transfers – Presumed as taxable income

The Tax Administration Service (“SAT”) has recently assumed bank transfers between a taxpayer’s accounts as taxable income. A determination from SAT must be challenged.

The Federal Court of Administrative Justice has recently issued a ruling that lists the proper documentation to eliminate the presumption of the “taxable income” of the inter-account wire bank transfers. From this ruling (published on June 25, 2021), taxpayers must support their bank transfers with the following documentation:

  • Account statements.
  • Accounting work papers.
  • Copy of the receipt specifying the amount and the account from which the deposit is made.
  • Check number or transfer report.
  • Number and name of the bank account opened in the name of the taxpayer where the outgoing deposit is shown.
  • Origin of the deposited amount.

We will be glad to assist you if you have any comments or questions regarding this matter. For specific questions, please contact us.

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

 

 

LEGAL ALERT: Election day -Mandatory rest day.

On June 6th, 2021, federal and local elections will be held in Mexico. For such purposes, employers should be aware that such date is considered to be a mandatory rest day for labor purposes. Therefore, they must consider various employer obligations if their employees work on June 6th, 2021. Please find herewith the applicable legal framework:

Should Sunday, June 6th, 2021, be considered a mandatory rest day for labor purposes?

Yes, June 6th, 2021 is considered to be a mandatory rest day for labor purposes. Therefore, if an employee works on such day, the employer is obligated to pay double salary for the service provided in addition to the salary corresponding to mandatory rest.

Although the Mexican Federal Labor Law (“LFT“) does not specifically establish that the sixth day of June is a mandatory rest day, it does establish that in the case of ordinary elections, the electoral laws may decree the day of the election as a mandatory rest.

Likewise, the electoral laws, and specifically Article 22.2 of the Mexican General Law of Electoral Institutions and Procedures (“LGIPE“), establishes that “The day on which ordinary federal elections must be held, shall be considered to be non-working days“. Therefore, June 6th, 2021 is to be considered a mandatory rest day for labor purposes.

What other obligations do employers have if employees of the company operate on Sunday, June 6th, 2021?

It is necessary to note that the LFT also establishes that on election day all employers are obligated to grant their workers the time necessary to exercise their vote. In other words, depending on their working schedule, the employees might work fewer hours on such day than the daily or agreed-upon period, considering that the polls open at 8:00 a.m. and close at 6:00 p.m.

What are the possible penalties or legal consequences in case of non-compliance with such obligations?

In accordance with the LFT, fines of up to 5,000 Units of Measure and Actualization may be imposed for non-compliance with these regulations. Additionally, the worker would have the right to initiate labor actions against the employer for the breach of said norms.

In the event that you would like to receive further information relating to a mandatory rest day on election day, please contact one of the following attorneys:

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Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

Possible changes regarding the Federal Maritime and Terrestrial Zone.

On April 21st, 2021, a legislative initiative was presented in the Senate of the Republic in order to reform the General Law of National Property (the “Law”). Such initiative will be sent to the House and will continue to be discussed. Nevertheless, taking into account its relevance, we consider it important to keep you informed.

The initiative proposes:

  1. The modification of the current delimitation of maritime beaches, as well as to enlarge maritime beaches by ten meters starting as of the place where the high tide occurs, that is, from where the Federal Maritime and Terrestrial Zone currently commences.
  2. To include as part of maritime beaches the sand, cliffs, rock formations, as well as any other surface or geological form that in virtue of the tide is covered or uncovered by the sea.
  3. To precise that maritime beaches will be of public use, with free access to it and to the sea always guaranteed, in any direction, without the possibility of requiring any type of payment to secure said access, to prohibit or block its way, or to be used as private property.
  4. The reduction of the surface of the Federal Maritime and Terrestrial Zone to ten meters of the width of land that is firm, walkable, and next to such maritime beaches, as well as of lakes, lagoons, estuaries, or natural deposits of seawater that communicates directly or indirectly with the sea. This, in order to avoid affecting current private property.
  5. The clarification of the concept of Federal Maritime and Terrestrial Zone since the Law currently uses the term “beaches” instead of “maritime beaches”, and
  6. A provision that respects the concessions granted prior to the reform of the Law, and provides that once the corresponding obligations end, the renewal of the concessions will be in accordance with the new regulations.

We will keep you informed of the events that continue to unfold regarding the initiative to reform the Law.

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Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

 

Annual Corporate Compliance.

In accordance with Mexican law, there are several corporate obligations that all Mexican entities must comply with.

Hereunder please find a summary of the main ones:

I. Annual meeting of shareholders or partners.

In accordance with the Mexican General Law of Commercial Entities, shareholders or partners of a commercial entity are required to meet at least once a year, within the first four months of the year, in order to hold a meeting to approve the financial statements of the entity.

The deadline to hold the above-mentioned meeting is April 30th, 2021.

If your entity has not yet held such a meeting, please let us know if we may assist you.

II. Declaration of shareholders or partners abroad (out of Mexico) who elect not to be registered in the Mexican Taxpayers’ Registry (official form 96).

The Mexican Federal Tax Code states that within the first three months of the year Mexican entities shall file with tax authorities a notice providing the tax identification number, tax address, and tax residency of their non-Mexican shareholders/partners.

The deadline for filing the notice was March 30th, 2021.

If you have not yet complied with such obligation, please let us know if we may assist you.

III. National Registry of Foreign Investments (NRFI).

Mexican entities with foreign investment must file a notice with the NRFI if such fall in any of the following categories:

  1. Annual economic notice. In the event that the entity has a total amount equal to or greater to MXN$110’000,000.00 Pesos in any of the following accounts: total initial balance of assets, final balance of assets, total initial liabilities, final total liabilities, income (in Mexico and abroad), and/or expenses (in Mexico or abroad).
  2. Quarterly modification notices. In the event of modification of any of the following items of the entity: (i) the business name, (ii) the corporate name, (iii) the tax domicile, and (iv) the economic activity. Also, the following events, provided such result in operations for an amount greater to MXN$20,000,000.00 Pesos:
  • Capital increase or decrease;
  • Change to the structure of the partners/shareholders,
    and/or;
  • Variations in any of the following accounts: (i) account receivable from residents abroad who are part of the same corporate group, (ii)  accounts payable to residents abroad who are part of the same corporate group, and/or (iii) contributions for future increases in the capital stock of the entity, capital reserves, or resulting from previous tax years.

Should you have any questions relating to the above, please do not hesitate to contact us.

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Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

 

 

LEGAL ALERT – Changes to Outsourcing.

On April 14, 2021, the Mexican Congress approved a bill that amends the rules regarding the outsourcing of personnel and employee profit-sharing. The amendment adds and amends several provisions and laws.

The amendment amends six different laws: the Federal Labor Law, the Social Security Law, the Housing Fund Law, the Federal Tax Code, the Federal Income Tax Law, and the Federal Value Added Tax Law.

IN SHORT:

The amendment:

  • Prohibits the subcontracting of personnel.
  • Allows subcontracting specialized services or execution of specialized work, provided that the service provider complies with rules to be published and secures a registry before the Labor and Employment Department (“Labor Department”).
  • Allows subcontracting of specialized services between entities that are part of the corporate group, also known as insourcing, provided that the service provider is registered with the Labor Department, and the applicable requirements and conditions.
  • Allows subcontracting of services of recruitment, selection, training, and professional development.
  • Limits or caps the amount that an employee will receive as profit sharing.
  • Conditions employer substitutions to the transfer of assets of the employer that is transferring the employees.
  • Establishes various fines and penalties.
  • Eliminates the fiscal effects (e.g. tax deduction, value-added tax credit) of the tax invoices related to subcontracting of personnel services.
  • Considers the simulation strategies for the subcontracting of personnel as organized crime.
WHAT ARE THE APPROVED SANCTIONS AND FINES?
  •  Fines ranging from 50 to 5000 times the UMAs (“Unidad de Medida y Actualización” or “Unit of Measurement and Update”), MX$89.22 per UMA for 2021), to those employers that refuse or obstruct subcontracting of personnel inspections and surveillance.
  • Fines ranging from 2,000 to 50,000 UMAs, to those who, in violation of the above, use or gain benefits through subcontracting of personnel, and to the companies that provide specialized services and operate without the corresponding registration.
  • Elimination of tax deduction and any tax credit for expenses related to the subcontracting or for those services that personnel is provided.
  • Using deceptive practices to provide specialized services or the execution of specialized works, or the subcontracting of personnel would result in tax fraud.

DEADLINES TO CONSIDER:

  • Once the Mexican Senate approves the bill, it will be sent to the President for his signature and publication, which is expected to be May 1, 2021.
  • Rules to be issued: 30 days. The Labor Department has to publish the rules for securing the registry for specialized services, including insourcing companies.
  • Registry: 3 months. As of the date in which the rules for the registry are published, the specialized services and insourcing companies have to obtain the registry before the Labor Department.
  • Immediately within the following 3 months as of the amendment is published in the Federal Gazette, to carry out the employer substitution without having to transfer the assets of the company that will transfer the employees.

WHAT DO WE HAVE TO REVIEW IN OUR OPERATIONS?

  • For those companies of the same corporate group, review the operations between them to determine if it is necessary to carry out a restructuring of the corporate operation and organization.
  • Analyze and review outsourcing agreements to determine the actions that need to be taken.
  • Analyze the insourcing services to confirm if they comply with the requirements and conditions and implement the corresponding registry.
  • Analyze the contracts for specialized services or works and ensure they do not consist of activities related to their corporate purpose or economic activity.
  • Surveillance and ensure that the specialized services and works companies, comply with the registry, and meet the new requirements that the Labor Department will issue. Also, they must comply with the new labor, social security, and tax obligations.

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For any questions or comments, please do not hesitate to contact us.

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

Suspension of the Importer’s Registry.

There are more than 35 causes for the suspension of a company’s importer registry and that the Tax Administration Service (“SAT”) makes effective when a taxpayer falls on one of such causes.

One must consider that any suspension of the importer’s registry may last for more than one month. That is, a taxpayer that suffers the suspension of its importer’s registry, will not be able to carry out importations during the suspension.

What are the most common causes for suspension?

In our experience the most common causes that the SAT uses to suspend the registry are the following:

  • Failure to file federal taxes, or failure to comply with other tax obligations.
  • The taxpayer is not located in its tax domicile, or when the registered tax domicile does not meet the requirements provided in the Federal Fiscal Code.
  • Failure to comply with the requests from the tax or customs authorities to present the documentation and information that proves the compliance of the tax or customs obligations, or when such filing is not complete.
  • When the legal representative, partner, or shareholder is a member of a company or is a natural person that has been suspended and such company has not been reinstated.
  • When IMMEX companies do not have the necessary infrastructure to carry out the maquila operations of the temporarily imported merchandise.

What do I need to do if our importer’s registry is suspended?

It is important to verify the reason causing the suspension of the importer’s registry. If the taxpayer cannot prove that the reason causing such suspension has been resolved, the suspension will not be lifted.

Once the taxpayer proves that the reason causing such suspension has been resolved, the procedure established in the foreign trade rules must be followed in order to nullify the suspension of the importers’ registry.  This process is performed on the webpage of the SAT.

In addition, it is extremely important to follow the process established by the SAT in order to avoid delays in reactivation.

How much time does the SAT have to cancel the suspension?

SAT has 30 days to reinstate taxpayers in the importer’s registry.

Is there anything that can be done to speed up the reinstatement process?

Evaluate the commencement of a “conclusive agreement” with the Taxpayers’ Ombudsman. This is since the SAT has the obligation to respond to the request of information carried out by such Ombudsman.

If your company’s importer’s registry has been suspended, we can certainly carry out actions in order to assist you.

For any questions or comments, please do not hesitate to contact us.

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Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

Excessive Charges in the Water Supply Bill.

Previously, TP Legal informed its clients of a recurring problem relating to various actions and/or “persuasive” collection efforts that are being carried out by the Water Company in all the municipalities of the State of Baja California (Tijuana-CESPT, Ensenada-CESPE, Mexicali-CESPM and Tecate-CESPTE), for alleged debts of connection fees to the water and sewage systems, or for consumption not accounted for in the consumers monthly water bill.

The manner in which such utility company has been operating consists of the issuance of a “summons” to the users of the water and drainage services, in which the consumer is urged to show up at the facilities of the water commission in order to be informed of the alleged debt and the consumer is provided an “estimate” of the amount that is owed, same that does not include the information required by law in tax/administrative procedures.

Since it has come to our attention that the utility company has recently increased its efforts to charge consumers, we would like to remind you that there are legal actions that may be carried out to challenge such actions.

TP Legal has provided legal advice and representation to the clients that have not agreed with the charge/payment demanded by the utility company, seeking legal alternatives to secure a proper defense to avoid extreme consequences such as the closure of their establishments or the suspension of the supply of the water and drainage services.

Furthermore, in TP Legal we have been able to secure constitutional protection resolutions (“amparos”) in favor of our clients. This, in order that the same may continue to enjoy water and drainage services and to challenge the alleged debts through administrative claims filed with the corresponding Courts.

If you require any assistance, or if you have any questions or comments regarding the above, please do not hesitate to contact us. 

Alejandro Pedrín   |   apedrin@tplegal.net
Héctor Torres-López   |   htorres@tplegal.net
Leobardo Tenorio-Malof   |   ltenorio@tplegal.net
Mauricio Tortolero   |   mtortolero@tplegal.net
Daniel Gancz-Kahan   |   dgancz@tplegal.net
Alejandro Ceballos   |   aceballos@tplegal.net
Elio Sánchez   |   ecsanchez@tplegal.net
Iván Curiel-Villaseñor   |   icuriel@tplegal.net
Raúl Escamilla-Sanromán   |   rsanroman@tplegal.net

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