10Sep

What your company should know about hiring in Mexico

septiembre 10, 2021 Luisa

There are challenges and uncertainties that companies will face as they expand to other countries. For example, hiring in Mexico, as recruiting personnel in a different country, has its own requirements and regulations when it comes to employment. Combined with language barriers, this can be a complex step for foreign companies.

Therefore, is important to know steps, processes, and regulations when hiring employees in Mexico, to ensure compliance with the Federal Labor Law.

The Mexican Labor Law (Ley Federal del Trabajo)

The Federal Labor Law states the laws that concerns the workers in Mexico and governs labor relations between employers and workers, establishing the employment relationship regulations between the person providing a personal service and the person receiving it.

Furthermore, this Law protects individual guarantees and makes it very clear that no distinction can be made between workers based on race, sex, religious creed, political doctrine, or social status.

Employment Agreement

In Mexico an employment agreement or labor contact is mandatory. There are three types of contract durations: indefinite, project and seasonal.

The labor contract represents a document that grants labor rights and gives clarity in:

Your specific obligations in the employment relationship between employer and employee
Hours of entry and exit.
Place and time where the workday start.
Days and places of payment.
Rules to prevent working risks.
Permits and licenses.
Disciplinary measures and their application.
The benefits you receive for your work: salary, breaks, vacations, social security, law, and additional benefits.

Working hours and minimum wage

When considering hiring in Mexico, it is important to have knowledge of the Federal Labor Law, which is very extensive and among other states following:

• According to Article 61, the maximum length of a Labor Day is eight hours during the day, seven hours at night, and seven-thirty hours when mixed. Extra hours must be paid according to article 66, there is a cap in overtime, and the first 9 hours must be paid double and extra hours triple.

• According to Article 85 of the Labor Law, a worker’s salary cannot be less than the minimum wage, and no employee in Mexico can be paid less than this legal minimum wage. Employers in Mexico who do not pay the Minimum Wage may face penalties from the government.

On January 1, 2021, Mexico’s minimum wage was increased by 15% to 141.70 pesos per workday. The tariff along the Northern Border Zone has been increased to $213.39 pesos per workday, every weekday, for the year 2021.

Vacations and benefits

In Mexico employees are entitled to 6 days of vacation days will increased corresponding to the number of years worked. In addition to the seven national holidays and additional day every six years on December 1^st.

Furthermore, there are important law benefits employers must take into account such as Christmas Bonus, which is mandatory and equivalent to 15 days of wage.

Another benefit for employees, is profit sharing in which a Company must distribute 10% of their pre-tax profits to their employees, after completing one year of operation.

First steps for hiring

The first step for being able to hire employees, is a registering your company before the social security institute as an employer (known in Spanish as IMSS, Instituto Mexicano del Seguro Social).

Lastly, the company must also be registered before tax authorities (SAT).

Hiring Foreign Employees

In Mexico, foreign workers are limited to 10% of a company’s workforce, and the company must be properly registered to hire foreign workers and provide the requisite working visa. All hiring restrictions are eliminated for directors, general managers, and administrators, allowing foreign nationals to fill up to 100 percent of these jobs.

To Directly or Indirectly Employ

Many companies choose to hire personnel through a subsidiary or service agent because complying with Mexican labor and social security law can be difficult. This can limit a foreign company’s exposure and liabilities.

Furthermore, local experience is most time required to know where to find the right person for the job.

Mexcentrix can support your company in the full hiring process, including pre-employment tests, interview, medical exams, reference checks, and registration with authorities, complying 100% with the Federal Labor Law. Contact us.

08Sep

Le Bélier confirms more than 100 million dollars of investment in Guanajuato

septiembre 8, 2021 Luisa

With more than 100 million dollars, Le Bélier confirmed that he will continue developing investment projects in Guanajuato.

The world’s leading aluminum smelting company in the automotive industry maintains its confidence in the region, which is why it will be generating 500 new jobs at its production plant in San Miguel de Allende.

Diego Sinhue Rodríguez Vallejo, governor of Guanajuato, stated that this project is the only one nationwide that brings together all the aluminum smelting techniques through state-of-the-art systems, which are supported by automation and digitization.

The state executive and government representatives had a meeting with David Guffroy, CEO of Le Bélier and his work team, where they shared that their investment in Guanajuato was a good decision due to connectivity, highly competitive workforce, possibilities for new businesses and ecosystem. local supply offered by the state.

“That is why we take care that the companies that arrive have a high social commitment and care for natural resources, that is the case of Le Bélier, which has an SBT certification for the good of our planet,” said Guffroy.

This French company serves the auto parts market for brands such as BMW, Mitsubishi, Daimler, Continental, Hitachi, among others. In addition, it has a workforce of 3,200 people, has a presence on three continents and estimates for 2021 more than 290 million euros in sales.

It should be remembered that, in June of this year, the European company began the construction of its plant that will be located in the San Miguel de Allende Business Park, where it is expected to start operations in the first months of 2022. On that date, had confirmed an investment of 68 million dollars and the generation of 500 direct jobs.

SOURCE: Mexico Industry

01Sep

Freightcar America and Fasemex will invest 63 million dollars in Coahuila

septiembre 1, 2021 Luisa

The Fasemex Group will invest 3 million dollars to install its metalworking plant called Lidell in Monclova, and promote the economic development of the Central Region of Coahuila.

This investment will generate at least 300 jobs for the production of hoppers.
Likewise, the expansion was announced by the Freightcar America company, which will invest 60 million dollars for the production of train wagons at its Castaños plant.

During the event, the first stone of this megaproject was laid, which already employs 900 people, a figure that could increase with this injection of capital thanks to the growth they will have.

For his part, Miguel Ángel Riquelme Solís, governor of Coahuila, recognized investors for their great effort in times of pandemic and promised to provide them with all the tools for their consolidation, such as a qualified workforce, job stability and well-being for the workers.

Jesús Meyer, president of corporate Freightcar America, said they have managed to build the 1,000th rail car, which highlights the highly talented and specialized human capital they have.

“This is a sample of the growth we have had in the manufacturing field, I have worked for nearly 40 years in this field and I can realize that the Castaños plant is world-class in quality and personnel,” concluded the manager.

SORCE: Mexico Industry

31Ago

Nestlé to invest US$160 million in Guanajuato

agosto 31, 2021 Luisa

GUANAJUATO – Diego Sinhue Rodriguez Vallejo, Governor of Guanajuato, agreed with Nestle in Switzerland an investment of US$160 million to be placed in Guanajuato’s Inland Port, which will generate 200 new direct jobs for the state.

This investment will begin in 2021 and will be part of an expansion of its production plant located in Guanajuato Puerto Interior, in the municipality of Silao.

Sinhue explained that this capital investment will increase production from 214,000 to 285,000 tons of dry feed, as well as from 12,000 to 25,000 tons of wet feed.

“It is good news because it also confirms the start of the economic reactivation in our state, with such an important company as Nestlé,” said the president.

He expressed his interest in further strengthening relations with Switzerland, and highlighted that there are currently investments of Swiss origin in Guanajuato of US$400 million, offering 840 committed jobs, mainly in the automotive, auto parts and agri-food sectors.

SOURCE: MEXICO NOW

30Ago

AGREEMENT that modifies the various by which the export and import quotas of non-originating textile goods and clothing are disclosed

agosto 30, 2021 Luisa

On August 27, 2021, the Ministry of the Economy, announced through various publications the export and import quotas for non-originating textile goods and clothing, susceptible to receiving preferential tariff treatment, in accordance with the Agreement between the United States of America, the United Mexican States and Canada, which was modified by various means published in the same official diffusion organ on March 5, 2021 (Agreement) and which aims to establish tariff preferences for textile goods and clothing not originating in the Treaty region between the United States of America, the United Mexican States and Canada (T-MEC) and that are exported to those countries.

The agreement was modified with the purpose of making more efficient the use of quotas to export cotton garments or artificial or synthetic fibers and wool garments and eliminate the established textile categories and promote the controlled use of the designated quantities of the Assignment Procedures to cover the commitments of exporters to the United States of America with the anticipation necessary to establish contracts and schedule their operations.

Therefore, in compliance with the provisions of the Foreign Trade Law, the provisions to which it refers were submitted to the consideration of the Foreign Trade Commission where the modification of the export and import quotas of textile goods and non-originating garments, susceptible to receive preferential tariff treatment, in accordance with the treaty between the United States of America, the United Mexican States and Canada.

The first paragraph of Point 1.1 is amended; the third paragraph of Point 1.4; Points 2.1.; 2.1.1;2.1.6; 2.2.1; 2.2.2; the first paragraph of Point 2.2.7; Point 2.2.9; the third paragraph to Point 2.3.1; Points 2.3.5; 2.3.6; 2.3.7 and 2.3.12; a first paragraph is added to Point 2.2.4; a last paragraph to Point 2.3.1 and a last paragraph to Point 2.3.2, and points 2.2.3 and 2.2.5 of the Agreement that disclose the export and import quotas for textile goods and clothing are repealed. non-originating clothing, susceptible to receive preferential tariff treatment, in accordance with the Agreement between the United States of America, the United Mexican States and Canada, published in the Official Gazette of the Federation on June 29, 2020.

Click here to access the official publication in the Official Gazette of the Federation (DOF) for your consultation.

24Ago

Grupo Prysmian to invest US$27 million in Durango

agosto 24, 2021 Luisa

DURANGO – Grupo Prysmian, a world leader in the manufacture of electrical and telecommunications cables with headquarters in Milan, Italy, and more than 40 years of presence in Mexico with 6 plants and more than 1,650 employees, announced the investment of US$27 million to begin the expansion of its cable and fiber optic manufacturing plant in the state of Durango.

The plant installed in Durango, was inaugurated in 2017, manufactures fiber and optical cables used in the telecommunications sector to enable internet access and connectivity services for communities, residential areas, businesses and industries.

The expansion is expected to double the current volume from 2.5 to 5 million kilometers of optical fiber per year, which will strengthen Prysmian’s leading position as a key strategic player in this segment.

“We are very proud of this important investment because even in the midst of this pandemic, we are very committed to our customers in the telecommunications industry and to Mexico,” said Marcelo De Paola, president and CEO of Grupo Prysmian in Mexico.

The expansion project will be completed in 2022 and would make Prysmian’s Durango plant one of the group’s three largest in telecommunications.

SOURCE: MEXICO NOW

20Ago

Aerospace industry to grow 7.5% by the end of 2021: FEMIA

agosto 20, 2021 Luisa

MEXICO – In view of the reactivation that aviation has shown in the face of the coronavirus pandemic, by the end of 2021, Mexican aerospace industry exports will have a marginal recovery, registering an amount of US$7.1 billion, an annual growth of 7.5%, according to a representative of the sector.

“During the past year, this sector reported a figure of US$6.6 billion,” detailed the executive director of the Mexican Federation of the Aerospace Industry (FEMIA), Luis Lizcano.

Lizcano explained that several aircraft parts are manufactured in Mexico and then exported, mainly to the United States and Canada, where they are assembled completely.

However, the president of FEMIA reported that Mexican aerospace industry exports at the end of the year will be 26% lower than in 2019, the pre-pandemic period.

“As domestic and international flights are reactivated, this will push us to have a higher level of parts sales abroad, which we expect to continue in the coming years,” the executive mentioned.

Lizcano commented that this industry is present in 20 states in Mexico, including Querétaro, Chihuahua, Sonora, Nuevo León and Baja California; the main exports are to the United States, Canada, France, Germany and the United Kingdom.

SOURCE: MEXICONOW

19Ago

Secretary of Public Economy announces uniform regulations of 4 chapters of the T-MEC

agosto 19, 2021 Luisa

On August 13, the Ministry of Economy announced the Promulgative Decree of the Protocol that Replaces the North American Free Trade Agreement with the Agreement between the United Mexican States, the United States of America and Canada, made in Buenos Aires on November 30, 2018; of the Protocol Modifying the Treaty between the United Mexican States, the United States of America and Canada, made in Mexico City on December 10, 2019; of six parallel agreements between the Government of the United Mexican States and the Government of the United States of America, which entered into force on July 1, 2020.

That Article 5.16.1 of the Agreement between the United Mexican States, the United States of America and Canada (T-MEC) establishes that the Parties must, for the entry into force of the same Agreement, adopt or maintain through their respective laws or regulations , Uniform Regulations regarding the interpretation, application and administration of Chapters 4 (Rules of Origin), 5 (Origin Procedures), 6 (Textile Goods and Clothing) and 7 (Customs Administration and Trade Facilitation) of the T- MEC, as well as other matters agreed by the Parties.

First of all, the T-MEC establishes that the Parties must, for the entry into force of the same Treaty, adopt or maintain, through their respective laws or regulations, Uniform Regulations regarding the interpretation, application and administration of the four corresponding chapters.

The T-MEC entered into force on July 1, 2020, modernizing and replacing the North American Free Trade Agreement (NAFTA).

Thus, the T-MEC maintains zero tariffs among the three countries that were in force under NAFTA.

This new agreement updates NAFTA in a number of key areas, including expanding the United States’ access to Canada for certain U.S. dairy, poultry and egg products and by establishing some of the most robust and advanced provisions on rights of intellectual property and trade in digital products.

Click here to access the official publication in the Official Gazette of the Federation (DOF) for your consultation.

18Ago

Continuation of the updated reform on outsourcing in Mexico

agosto 18, 2021 Luisa

Derived from the recent reforms to the Federal Labor Law, for the issue of personnel subcontracting or outsourcing; many companies are confused about the scope of these modifications in the outsourcing of various services. The first thing that those companies that intend to incorporate professional services for the provision of specialized services (outsourcing) should know or continue to maintain them in case they already have them in their organization, is the following:

1. The term as such of Outsourcing was eliminated, but now they will be called: specialized services companies or specialized works execution companies.

2. The subcontracting of professional services is allowed, as long as the requirements are met, that is, that the services that are contracted do not form part of the corporate purpose or the economic activities of the contracting company.

3. The personnel who carry out the main activities of the company may not be under the contracting of specialized services or the execution of specialized works.

4. Specialized service providers must be registered and registered in a public registry called: REPSE, which is regulated by the Ministry of Labor and Social Security.

5. Companies must have a written and signed contract to support the specialized services they hire.

How to adapt to the new reform?

Contractors or outsourcing agencies in Mexico must be registered with the Ministry of Labor and Social Welfare (STPS) and meet the necessary requirements; having until September 1 to register and regularize subcontracting services.

The terms of the Reform will also have to be considered: 1 month from the publication of the reform for the STPS to issue the guidelines for registration; 3 months for companies to regularize and recognize their workers, once the guidelines are published. Every 3 years companies will have to update their registration with the STPS.

In Mexcentrix you can access a safe and guaranteed specialized service complying with the requirements of the new reform of specialized services in Mexico, for more information contact us.

17Ago

Decision No. 107 of the Mexico-Colombia FTA

agosto 17, 2021 Luisa

On August 11, the Ministry of Economy announced through the Official Gazette of the Federation that the administrative commission of the free trade agreement between Mexico and Colombia agreed to grant a temporary dispensation for the use of certain materials produced or obtained outside the zone of free trade in the manufacture of certain textile and clothing goods, so that these goods can receive the preferential tariff treatment of the treaty.

This agreement is disclosed in decision No. 107 of the Administrative Commission of the Free Trade Agreement between the United Mexican States and the Republic of Colombia, adopted on July 9, 2021, said instrument will enter into force on August 12, 2021 and will conclude its validity on August 11, 2023.

The new products to which the Waiver will apply: certain textile goods classified in the subheadings of the Harmonized Commodity Description and Coding System: 6004.10, 6005.31, 6005.32, 6005.33, 6005.34, 6006.31, 6006.32, 6006.33, 6006.34, 6104.63, 6105.20, 6106.20, 6108.22, 6112.31, 6112.41, 6212.10, 6212.20, and 6212.90 totally elaborated in Colombia using the materials produced or obtained outside the free trade zone, classified, at the aancelarial fraction level in Colombia, in the fraction: 5402.31.00.00

The import tariff that Mexico will apply to the goods for which the exemption is granted, will be that corresponding to the original goods provided for in its tax relief schedule in Annex 1 to Article 3-04 of the treaty.

Tariff Fraction in Colombia (Input)	Description / Observations	Quantity (Net Kilograms)
(A)	(B)	(C)
54.02.31.00.00	Synthetic filament yarn (other than sewing thread) not put up for retail sale, including synthetic monofilaments of less than 67 decitex. Textured yarn: Of nylon or polyamides, with a count of less than or equal to 50 tex per single yarn.
	1. Polyamide, 78 Dx / 70Dr. Title, 68 filaments, 1 strand, 100% polyamide, Type 6.6, Ultramatte luster, ecru, S and Z twist process, Recycled	24,000
	Total	24,000

The certificate of origin will have to be filled out and signed by the exporter in this case, Colombia must indicate in the field of observations the following sentence: “the good complies with the provisions of decision No. 107 of the Administrative Commission of the Treaty and I use (amount (s)) kgs. of the exemption granted to (name of the material (s) used in the tariff section (s) _________. ”

Click here to access the official publication in the Official Gazette of the Federation (DOF) for your consultation.