ARTICLE
11 November 2022

Mexico's Senate Approves Granting More Vacations To Employees

OD
Ogletree, Deakins, Nash, Smoak & Stewart

Contributor

Ogletree Deakins is a labor and employment law firm representing management in all types of employment-related legal matters. Ogletree Deakins has more than 850 attorneys located in 53 offices across the United States and in Europe, Canada, and Mexico. The firm represents a range of clients, from small businesses to Fortune 50 companies.
Mexico is currently one of the countries in the world with the fewest number of paid vacation days for employees ...
Mexico Employment and HR
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After several months of discussion and uncertainty, on November 3, 2022, Mexico's Senate of the Republic approved a bill that would modify articles 76 and 78 of Mexico's Federal Labor Law (FLL) to entitle employees to more paid vacation days.

Mexico is currently one of the countries in the world with the fewest number of paid vacation days for employees, yet Mexican employees work more hours on average than other workers in the Western Hemisphere—an average of 2,255 hours yearly. Since 2018, with the implementation of Mexico's Ministry of Labor and Social Welfare's (STPS) Official Standard 035, "Psychosocial Risk Factors at Work—Identification, Analysis and Prevention" (NOM-035-STPS-2018), the Mexican government has been making advancements to create more balance between work and life and prevent future consequences for employees, such as burnout syndrome and work-related illnesses.

If enacted as approved by the Senate, the measure would allow employees to accrue vacation leave as follows:

Current Leave Accrual Proposed Leave Accrual
Years Worked Vacation leave employees are entitled to Years Worked Vacation leave employees are entitled to
1 6 days 1 12 days
2 8 days 2 14 days
3 10 days 3 16 days
4 12 days 4 18 days
5 to 9 14 days 5 20 days
10 to 14 16 days 6 to 10 22 days
15 to 19 18 days 11 to 15 24 days
20 to 24 20 days 16 to 20 26 days
25 to 29 22 days 21 to 25 28 days
30 to 34 24 days 26 to 30 30 days
31 to 35 32 days

Even though the Senate has approved the bill, it still needs to be reviewed and approved by Mexico's Congress of the Union and eventually by the executive branch before being published, at which point it would become enforceable. Therefore, changes to the bill can still be made, and an effective date cannot yet be defined. However, the bill is moving quickly and the government appears to be willing to make the new vacation leave regime enforceable by 2023.

Approval of the reform would come with several consequences, including economic impact to employers when paying vacation premiums, modification of leave policies, and company retention plans. Additional consequences would include a cultural shift that may help prevent work burnout, increase productivity, and promote more dignified labor conditions for employees in Mexico.

The Mexico City office of Ogletree Deakins will continue to monitor and report on developments with respect the Reform to the Federal Labor Law regarding vacations and will post updates on the firm's Cross-Border and Leaves of Absence blogs as additional information becomes available. Important information for employers is also available via the firm's webinar and podcast programs.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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