By – Lic. Alejandro Pedrin.
As of January 1, 2019, the general minimum wage in Mexico will increase in two geographic zones of the country:
- The National General Minimum Wage will increase from $88.36 pesos per day to $102.68 pesos per day in the entire country with the exception of the free zone located at the northern border and shared with the U.S.
- The General Minimum Wage applicable in the free zone located at the northern border will increase from $88.36 pesos per day to $176.72 pesos per day. That is twice the current minimum wage.
The free zone at the northern border includes the cities located in a strip of land of 25 kilometers of the border with the U.S. (attached you will find the location of the border zone).
It is important to note, that professional minimum wages will increase by 5%, depending on the profession or activity (attached you will find the list of professional minimum wages).
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:
- Labor indexed premiums or bonuses;
- Social Security premium;
- Housing premium;
- Savings funds;
- Employment benefits, and
- Ordinary or extraordinary labor unions premiums or fees.
It is very important that employers take into consideration 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 imply significant costs for 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.
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