The Mexican work force is young and tends to grow at a rate of more than one million employees per year. In general, companies have found that with proper training programs, the skills of Mexican workers can be upgraded and high quality work can be obtained. The young work force is amenable to new management techniques to which an older work force may be unable to adjust.

        The Mexican Federal Labor Law (LFT) regulates employee relationships in Mexico regardless of nationality or place of entry into the employment agreement.

Mandatory employee benefits

        •Profit Sharing: All employers must distribute among their employees an amount equal to 10 percent of the employer’s pretax profit within 60 days after the employer is required to file its year-end income tax return. Fifty percent of this amount is to be distributed in proportion to the number of days worked by each employee during the year, and the remainder according to the wages of each employee.

        •Christmas Bonus: All employers must pay their employees a year-end bonus equal to at least 15 days’ wage, payable before December 20th of every year.

        •Paid Holidays: Nine legal paid holidays must be observed. An employee required to work on any of these holidays must be paid overtime at the rate of three times the normal wage.

        •Holiday Premium: After one year of uninterrupted activity, workers will receive an annual paid holiday period, which can in no case be less than six working days, and will grow by two working days each year, until it reaches 12 days. After the fourth year, this period will be extended by two days for each five years of service. During this period, workers will receive a 25 percent minimum vacation bonus above their normal wage.

        •Legal Holidays: The Federal Labor Law establishes the following obligatory holidays throughout the country: January 1, February 5, March 21, September 16, November 20, and December 25. December 1 is an obligatory holiday every six years for the inauguration of new administrations. Most business offices, banks and large...

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