Ministry of Labor Tightens Scrutiny of Employment Contracts.

Recently we have detected that during the audit procedures carried out by the Ministry of Labor and Social Welfare, as well as by its similar within the states of Mexico, they have put special attention on the review of individual employment agreements, particularly on verifying that such agreements include all the requirements set forth in Article 25 of the Federal Labor Law (the “FLL”, for its acronym in Spanish), with employers facing fines ranging from $5,000 Mexican pesos to $586,550 Mexican pesos, which may be also imposed per each affected employee.

This increased scrutiny is particularly relevant given that individual employment agreements are key documents used by employers to evidence employee’s employment conditions.

In this context, we recommend to strengthen the company’s employment documentation, including:

1. Reviewing individual employment agreements to verify compliance with the FLL.
2. Identifying missing or outdated provisions, as well as provisions that do not reflect the employees’ current employment conditions, particularly pursuant recent reforms.
3. Preparing any necessary amendments through addendums to employment agreements.
4. Update employees’ personnel files so that the company is better prepared in the event of a labor inspection.

Our Labor and Employment practice is ready to offer tailored legal advice review your individual employment agreements and, where appropriate, assist in implementing corrective measures, prior that such documentation is required by the authority in an audit.

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