For many years The Mink Company (TMC) a U.S. based employment agency has provided high paying freelance opportunities in Mexico for our clients. With recent changes to Mexican Labor Laws we have had to convert these freelancers to full time employees via a local Mexico based agency. TMC does not have a local office in Mexico and all our freelancers work from a home offices. Partnering with a local agency made the most sense for our business model.
The changes went into effect on April 23rd, 2021 and according to the amendment, employers are no longer permitted to subcontract or outsource unless you are an official employer in Mexico or your Mexican agency is set up as follows:
- Obtain the registration certificate before the Ministry of Labor and Social Welfare or Secretaría del Trabajo y Previsión Social, (STPS).
- Execute a contract for the provision of the specialized services.
- Submit a quarterly report to Mexico’s Social Security agency (Instituto Mexicano del Seguro Social or IMSS ) and Mexico’s housing agency, Instituto del Fondo Nacional de la Vivienda para los Trabajadores or INFONAVIT on the specialized services contracts executed.
- Provide Guaranteed Employee Seniority
- Provide Profit Sharing with a max of 3 months income per year.
Of course there are several more requirements that include things like PTO and sick leave but the above should give you a pretty good idea of what is required. The laws are clear that the Mexican government wishes to eliminate practices that damage labor rights of employees and ensure employers have true tax obligations. TMC has found this substantially more complex but we have a system in place to help company’s retain their Mexico based talent. If you need assistance with this please reach out to us at 608-217-4030 or email email@example.com