Discover the global hiring and employment landscape in Mexico—with its expanding economy, business-friendly setup, and skilled workforce, it is an inviting spot for entrepreneurs to establish a presence in the region.
Explore the employment essentials including payroll, personal income tax, statutory contributions, annual leaves, minimum wage, terminations, visa requirements, and more. Gain valuable compliance insights for a smooth entry into the dynamic Mexico market with Slasify's global premium HR platform.
| Capital | Mexico City |
| Currency | Mexican Peso (MXN) |
| Payroll Cycle | Bi-weekly |
| Minimum Wage (General) | MXN 278.80 per day |
| Annual Leave | At least 12 days |
| Personal Income Tax | 1.92%–35% |
Mexican tax residents are subject to the following progressive tax rates:
| Taxable Income (MXN) | Progressive Tax Rate (%) |
|---|---|
| Up to 764.04 | 1.92 |
| 764.05–6,332.05 | 6.4 |
| 6,332.06–11,128.01 | 10.88 |
| 11,128.02–12,935.82 | 16 |
| 12,935.83–15,487.71 | 17.92 |
| 15,487.72–31,236.49 | 21.36 |
| 31,236.50–49,233.00 | 23.52 |
| 49,233.01–93,993.90 | 30 |
| 93,993.91–125,325.20 | 32 |
| 125,325.21–375,975.61 | 34 |
| Over 375,975.61 | 35 |
There are no local taxes on employment income in Mexico, though employers may be liable to a payroll tax that varies between 2%–4.25% depending on the state the business is located in.
Social security contributions in Mexico are calculated based on either the prevailing Measurement and Updating Unit (UMA) or the employee's Base Listed Salary (BLS).
| BLS | UMA |
|---|---|
|
BLS is the amount paid out to the employee, taking into account mandatory employee benefits like vacation premiums and Christmas bonus. An employee's daily BLS can be determined by multiplying the employee's daily salary with the relevant integration factor that ranges from 1.0493 to 1.0616. |
A UMA unit is equivalent to MXN 113.14 per day, MXN 3,439.46 per month and MXN 41,273.52 per year. |
Note: BLS used to calculate contributions to the IMSS are subject to a maximum of 25 UMAs.
| Contribution Rates | Contribution Base | Note | |
|---|---|---|---|
| Disease and Maternity Insurance I | 20.40% | UMA | An additional 1.10% is levied for employees making more than 3 UMAs, calculated based on the difference between BLS and 3 UMAs. |
| Disease and Maternity Insurance II | 1.75% | BLS | - |
| Disablement and Life Insurance | 1.75% | BLS | - |
| Work Risk Premium | Varies | BLS | Determined by the level of risk attached to the industry and type of employment environment. |
| Old-Age Pension | 2% | BLS | - |
| Advanced Age Severance | 3.15%–6.442% | BLS | Determined by the employee's BLS. |
| Nursery and Social Benefits | 1% | BLS | - |
| National Housing Fund (INFONAVIT) | 5% | BLS | - |
| Contribution Rates | Contribution Base | Note | |
|---|---|---|---|
| Disease and Maternity Insurance I | 0% | UMA | An additional 0.4% is levied for employees making more than 3 UMAs, calculated based on the difference between BLS and 3 UMAs. |
| Disease and Maternity Insurance II | 0.625% | BLS | - |
| Disablement and Life Insurance | 0.625% | BLS | - |
| Advanced Age Severance | 1.125% | BLS | - |
Employees shall be paid bi-weekly at an interval of no more than 15 days.
The general minimum wage in Mexico for 2024 is MXN 278.80 per day, and a higher minimum wage of MXN 419.88 per day applies to all employees working in the Free Trade Zone (FTZ) of the Northern Border.
Employees shall be entitled to receive annual Christmas bonus—Aguinaldo—equivalent to at least 15 days' salary. This is payable by December 20 of each year, with those who have not completed a year of service or is terminated halfway through the year having their entitlement prorated accordingly.
In addition to the Christmas bonus, unless the employer are exempted, employees may also be entitled to have a share in company profits, usually in an amount equivalent to 10% of the business' fiscal profit. This is to be distributed within 60 days following the date on which the annual tax must be paid as follows:
| First half | Second half |
|---|---|
| Equally distributed among all employees, taking into account the number of days worked by each employee in the year regardless of their wages | Distributed in proportion to the wages earned for the work performed during the year. |
Note: Certain types of employees may have their profit share limited to a certain maximum.
Employers and employees may terminate employment relationships at any time without incurring any liabilities to themselves as long as they have just cause.
| Just cause for dismissal | Just cause for resignation |
|---|---|
| Article 47 of the Federal Labor Law | Article 51 of the Federal Labor Law |
Employees who have been in service for more than 20 years have special protection against dismissal, whereby only particularly serious justification or actions that makes continued employment impossible will be considered just.
There are no statutory notice period under the Federal Labor Law, though they may still be negotiated under an individual or collective agreement.
The severance package an employee is entitled to will vary according to the reason of their termination, as follows:
| Severance pay | |
|---|---|
| Dismissed without just cause | 3 months' compensatory pay + 20 days' salary for each year of service |
| Resignation with just cause | 3 months' compensatory pay + 20 days' salary for each year of service |
| Employees' physical or mental disability, provided that it is not work-related | 1 month's salary |
Regardless of the cause of termination, a seniority premium equivalent to 12 days' salary for each year of service shall be paid to those who have at least 15 years of service. This premium shall be calculated based on the employee’s salary up to 2 times the minimum wage.
Any probation or initial training period must be stipulated in writing, guaranteeing the employee's social security.
| Purpose | Maximum duration | |
|---|---|---|
| Probation period | To verify the employee's competence for the job. | 30 days, or 180 days for qualified employees |
| Initial training period | To train the employees on the knowledge and skills necessary for the job. | 3 months, or 6 months for qualified employees |
Employers can only implement either a probationary period or an initial training period (not both) once to the same employee. They are also non-renewable.
At the end of the probation or initial training period, employers can dismiss, without any liabilities to themselves, employees who they think do not meet the requirements or have the knowledge necessary to carry out the work.
Standard working hours in Mexico is subject to a maximum of 8 hours per day. However, employees and employers can come to an agreement to work more hours each day to free up space for a partial day off in the week.
Employees are entitled to a break period of at least 30 minutes in each work day. This break shall be unpaid unless the employee cannot leave their place of work during their break.
In addition to the regular break periods, female employees are also entitled to two 30-minute breastfeeding breaks per day to nurse their children. If the granting of such leave is not possible, the employee must have their work day reduced by an hour during their lactation period.
Note: Breastfeeding breaks shall remain valid for up to a period of 6 months.
Employees may be required to work overtime, the limits and compensation of which shall depend on the reason giving rise to the overtime.
| Emergency Overtime | Extraordinary Overtime | |
|---|---|---|
| Reason | To avoid accidents or imminent risks in which the lives of the employee, their colleagues or their employers are endangered. This may also be performed to avoid imminent risks threatening the very existence of the company. |
Any other extraordinary circumstances aside from those justifying emergency overtime |
| Overtime Limit | N.A. | 3 hours per day or 3 times per week |
| Overtime Pay | N.A. | Overtime work that is within the limits of 3 hours per day, 9 hours per week or 3 times per week is paid at 200% of the employee's regular rate. Any overtime work in excess shall be paid at 300% of the employee's regular rate |
Employees are entitled to at least one fully paid rest day per week, which usually falls on a Sunday.
If the employee cannot have Sunday off, the day offshall be mutually agreed on between the employer and employee. An additional premium of at least 25% over their regular rate must be paid for any work performed on a Sunday.
Employees required to work on their weekly rest days shall be paid at 200% of their regular rate for the work performed.
Employees generally cannot be called in for work during mandatory public holidays. There are 7 days of mandatory public holidays in Mexico for 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Constitution Day | February 3 |
| Benito Juarez Day | March 17 |
| Labor Day | May 1 |
| Independence Day | September 16 |
| Revolution Day | November 17 |
| Christmas Day | December 25 |
In addition to the above, there are also 6 days of non-mandatory holidays that are widely observed in Mexico for 2025.
| Non-mandatory holiday | Date |
|---|---|
| Holy Thursday | April 17 |
| Good Friday | April 18 |
| Anniversary of the Battle of Puebla | May 5 |
| Day of the Race | October 12 |
| All Soul’s Day | November 2 |
| Lady of Guadalupe Day | December 12 |
In any case, employees required to work on mandatory public holidays must be paid at 200% of their regular rate.
Employees who have completed a full year of service are entitled to 12 days of paid annual leave, which are subject to increase by 2 days for every year of service thereafter up to a total of 20 days. Furthermore, starting from the employee's 6th year of service, they shall be entitled to an additional paid annual leave of 2 days for every 5 years of service.
| Years of service | Annual leave entitlements |
|---|---|
| 1 | 12 days |
| 2 | 14 days |
| 3 | 16 days |
| 4 | 18 days |
| 5 | 20 days |
| 6–10 | 22 days |
| 11–15 | 24 days |
| 16–20 | 26 days |
| 21–25 | 28 days |
| 26–30 | 30 days |
Annual leave period may be split into multiple parts, provided that one of them is at least 12 continuous days. This period of continuous leave shall be taken at the employee's discretion.
Annual leave must be granted within 6 months following the completion of the relevant year of service, and the employee is entitled to a vacation premium of at least 25% on top of their regular pay when they take their annual leave.
Employers are not obligated to pay employees who are absent due to a temporary disability caused by a non-occupational accident or illness out of pocket.
Female employees are entitled to 6 weeks of pre-natal leave and 6 weeks of post-natal leave. Under certain circumstances, the post-natal portion of the leave may be extended, as follows:
| Explanation | |
|---|---|
| Transfer of pre-natal leave | With the support of the employee's doctor, and accounting for the opinion of the employer and the nature of the work performed, up to 4 weeks of pre-natal leave can be used after childbirth instead. |
| Child born with disability | If the child is born with any type of disability or require medical attention, post-natal leave shall be extended to 8 weeks upon the presentation of the relevant medical certificate. |
Employees on maternity leave are entitled to continue receiving their full salary. If they are unable to return to work due to their pregnancy or childbirth, they can extend their leave by up to 60 days at half pay.
The IMSS shall provide eligible individuals with maternity pay for up to 42 days before delivery and 42 days after delivery at 100% of the employee's last daily BLS. In the event of late deliveries, the days in excess of 42 days before delivery shall be paid by the IMSS at the rate for sick leave.
Note: If the employee fails to qualify for the IMSS benefit or if the amount received is less than their regular pay, the employer shall pay their employees the difference.
Male employees are entitled to 5 days of paid paternity leave, paid by the employer, in the event of the birth of their children or the adoption thereof.
| Reasons | Paid/Unpaid | Duration | Notes |
|---|---|---|---|
| Employee declared missing with a Special Declaration of Absence | Unpaid | - | - |
| To carry out accidental or permanent commission from the employee's union or from the State | Unpaid | Up to 6 years | Employers must be notified as soon as practicable. This is only granted when the number of commissioned employees is not such that it impairs the smooth running of the establishment. |
| To vote in popular elections, perform jury duty and other state obligations; | Paid | For the duration of the obligation | - |
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