Federal Labor Law of Mexico
Introduction
The Federal Labor Law (Ley Federal del Trabajo, LFT) is the principal labor legislation in Mexico, implementing Article 123 of the Constitution. Originally enacted in 1931, the LFT governs individual and collective employment relationships, establishing the rights and obligations of workers and employers. The law has been substantially reformed, with major amendments in 1970, 2012, 2019, and 2021.
Historical Development
The first Federal Labor Law was enacted in 1931, implementing the labor rights guaranteed by Article 123 of the 1917 Constitution. The 1970 reform significantly expanded the LFT, incorporating new worker protections, regulating profit sharing, and establishing the conciliation and arbitration boards. The 2012 reform introduced labor flexibility measures and subcontracted work provisions. The 2019 reform transformed labor dispute resolution, and the 2021 reform restricted outsourcing.
Individual Employment Relations
The LFT defines the employment relationship and establishes: mandatory contract terms; working hours (maximum 8 hours day shift, 7 hours night shift); overtime (double time for the first 9 hours, triple time thereafter); minimum wage (set by CONASAMI); mandatory rest days (one day per week); paid vacations (minimum 6 days after one year, increasing with seniority); Christmas bonus (aguinaldo, 15 days’ wages minimum); and profit sharing (10% of pre-tax profits).
Collective Labor Relations
The LFT recognizes the rights to unionize, bargain collectively, and strike. Unions must register with the Federal Center for Labor Conciliation and Registration and comply with democratic governance requirements. Collective bargaining agreements must be negotiated in good faith and registered. Strikes are lawful when they pursue permitted objectives (improving working conditions, enforcing collective agreements, or protesting unfair practices) and meet procedural requirements.
Subcontracting Reform 2021
The 2021 reform severely restricted outsourcing (subcontratación or outsourcing). The reform prohibits the subcontracting of core business activities and limits specialized services to activities outside the corporate purpose of the beneficiary. Specialized service providers must register with the STPS. Violations result in significant tax penalties and criminal liability for tax evasion.
Labor Justice Reform 2019
The 2019 labor justice reform replaced the conciliation and arbitration boards with specialized labor courts under the judicial branch. The reform created the Federal Center for Labor Conciliation and Registration and established mandatory pre-litigation conciliation. Labor trials are now oral, adversarial, and public.
Conclusion
The Federal Labor Law provides comprehensive protections for workers’ rights, implementing constitutional guarantees through detailed provisions on individual and collective labor relations. The 2019 and 2021 reforms modernized the labor justice system and restricted abusive outsourcing, aligning Mexican labor law with international labor standards.