Labour initiative: Reduction in working hours, what would be the implications for my company?

What does this involve?

It will reduce the working day from 48 to 40 hours per week, with two days of mandatory rest for every five days worked.

Currently, the Law establishes that workers have the right to one day of rest for every six hours worked, with a daily workday of 8 hours per day.

It should be noted that the last modification to the working day in Mexico took place over a hundred years ago in 1917.

More importantly, such a reduction to 40 hours would not imply a decrease in the payment to workers, because the bill proposes working fewer hours for the same salary.

The bill also would imply that any hours worked after the 40:01 every week should be paid as overtime, as opposed to what some employers currently do, paying after the 49th hour, despite the legal maximum of 8 hours per day.

What implications could it have?

• Overtime pay as mentioned.
• Pay for working on rest days, representing an additional +200% of salary.
• Where appropriate, an increase in the social security dues, resulting from the accumulation of previous payments to the payable dues.
• A potential increase in payroll tax due to the accumulation of previous payments to the payroll tax base.
• Hiring more personnel as a result of the reduction of available time for each worker.
• An overall increase in labour costs.
• Adaptations to timekeeping devices and systems.
• Modifications to payroll systems.
• Changes to employment contracts, etcetera.

Who would this reform affect/benefit?

Employers and millions of workers in all sectors who currently work more than 40 hours a week as part of their workday and it is also expected to benefit people who are available to employers outside their working hours.

How we can help

At Mazars, we have a team of professionals at your disposal to analyze and/or respond to your questions on the subject.