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We are your Employer of Record in Mexico. This country, a rapidly growing economy with a strategic location, presents significant opportunities for businesses looking to expand their operations in the Americas.
However, understanding its complex labor and tax laws is crucial for successful operations. An Employer of Record (EOR) in Mexico can provide the necessary expertise and support.
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While establishing a subsidiary in Mexico is a traditional approach to local expansion, using an Employer of Record offers several distinct benefits:
The Advantage in Figures
PEO/EOR
Company Incorporation
Price
80% Less Expensive
Market Entry
2-5 Days
6 Months
Expedited Market Entry
A Mexican Employer of Record allows you to quickly enter the Mexican market without the need to set up a local entity, enabling faster business expansion.
Regulatory Compliance
The Employer of Record ensures your business complies with Mexican labor laws, including those related to employment contracts, taxes, and employee benefits, reducing the risk of legal complications.
Local Talent Acquisition
The Employer of Record aids in recruiting and managing local and foreign staff, ensuring access to the best talent in Mexico while handling all aspects of employment.
Cost Efficiency
Partnering with a Mexican Employer of Record helps you avoid the high costs associated with establishing and maintaining a local entity. The EOR manages all payroll, benefits, and HR tasks, freeing up resources for growth.
Operational Flexibility
A Mexican Employer of Record provides the ability to scale your operations up or down based on market needs, without the complexities of setting up a permanent entity, offering greater flexibility.
We provide a simple setup process to get you started in Mexico as quickly as possible.
1
We meet with you to discuss your needs and formulate a tailor-made plan for your company.
2
Our PEO provides the necessary legal structure through which you can bring your employees into Mexico.
3
Our experienced specialists can handle all your recruitment, hiring, and HR services on a day-to-day basis.
4
You and your employees can continue operating on schedule to reach your global expansion goals.
When considering a partnership with a PEO in Mexico, you will likely also hear the term EOR (Employer of Record). Typically, the two terms are largely interchangeable based on the kind of services they offer. The main difference between the two is the level of liability taken on by the PEO/EOR and the parties involved in the agreement.
In Mexico both services are indistinct according to national regulations, but INS Global can offer any elements of both according to your requirements
Check Our Mexico Labor Law Guide
In Mexico, employment contracts are mandatory and must be in writing, as required by the Federal Labor Law (Ley Federal del Trabajo, LFT). These contracts can be for an indefinite period, a specific project, or a fixed term, depending on the nature of the work. Contracts must include essential details such as job duties, salary, working hours, and conditions for termination. Indefinite-term contracts are the most common, providing greater job security for workers. The LFT ensures that all contracts adhere to minimum standards, including compliance with the national minimum wage, which was set at MXN 207.44 per day as of 2023.
Work Hours and Overtime in Mexico
Mexican labor law dictates that a working day cannot exceed 8 hours, and the total number of weekly work hours cannot be more than 48.
Overtime pay is double the regular wage for the first nine hours; any hours beyond that require triple payment. Overtime hours are limited to three hours daily and for three consecutive days.
Employees required to work on Sunday are expected to be paid 25% more than their regular hourly wage.
Holidays and Annual Leave
There are 8 days of public holiday in Mexico. Employees who must work during those days are entitled to 300% of their regular salary.
Employees in Mexico must receive a minimum of 6 vacation days after one year of employment. They will receive 2 additional vacation days for each year of work until the fourth year. After the fourth year, employees should receive 2 extra days for every five years of employment.
Sick Leave in Mexico
Sick leave payments are covered by the government social care system and require medical documents before granting paid leave.
As long as the employee has made their social security payments for at least four weeks before asking for sick leave, they will receive 60% of their wages from day 4 to 52 of sick leave. If their illness or injury results from work, they will receive 100% compensation.
Parental Leave in Mexico
Expectant mothers may take six weeks before birth and six weeks after for paid maternity leave, and fathers can take five days. The government covers maternity leave payments.
Employers in Mexico are responsible for withholding income tax from their employees according to a progressive bracket system. Residents are taxed progressively depending on income, with rates ranging from 1.92% to 35%. Non-residents are subject to a flat rate of 15% or 30% depending on their income level.
There is also a social security contribution, where employers must contribute 2% of the employee’s salary toward their retirement fund and 3.15% toward unemployment benefits.
Corporate tax in Mexico is 30%.
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faqs
An Employer of Record in Mexico manages all legal, HR, and compliance-related tasks, allowing businesses to swiftly enter the Mexican market without needing to establish a local subsidiary.
Using an Employer of Record in Mexico can be more economical than setting up a local entity, as it avoids the costs of incorporation and reduces ongoing administrative expenses.
Yes, a Mexican Employer of Record manages the visa and work permit application process, ensuring full compliance with local immigration laws.
Employer of Record services in Mexico are advantageous for companies of all sizes, particularly those seeking quick market entry, cost reductions, and less administrative burden.
Employer of Records in Mexico have local professionals who stay up-to-date on legal changes, managing all compliance tasks to ensure your business operates within Mexican labor law requirements.
Though the Mexican Employer of Record is the legal employer, you retain substantial authority over the day-to-day management and decision-making processes concerning your employees.
A Global Employer of Record is an effective solutions for companies like yours that are looking to expand a workforce abroad effortlessly.
This approach allows you to outsource the international hiring process quickly and efficiency, providing access to a global talent pool while still managing payroll compliance in each country.
Public Holidays Calendar
Mexico
| Date | Day | Holiday | Notes |
| January 1 | Wednesday | New Year’s Day | Celebration of the beginning of the Gregorian calendar year |
| February 3 | Monday | Constitution Day | Commemorates the promulgation of the 1917 Constitution; observed on the first Monday of February |
| March 17 | Monday | Benito Juárez’s Birthday | Honors the birth of President Benito Juárez; observed on the third Monday of March |
| April 17 | Thursday | Maundy Thursday | Christian holiday commemorating the Last Supper; widely observed, especially in the banking sector |
| April 18 | Friday | Good Friday | Christian holiday commemorating the crucifixion of Jesus Christ; widely observed, especially in the banking sector |
| May 1 | Thursday | Labor Day | International Workers’ Day; celebrates labor and workers’ rights |
| September 16 | Tuesday | Independence Day | Commemorates the start of Mexico’s War of Independence in 1810 |
| November 17 | Monday | Revolution Day | Marks the beginning of the Mexican Revolution in 1910; observed on the third Monday of November |
| December 25 | Thursday | Christmas Day | Christian holiday celebrating the birth of Jesus Christ |
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