New Laws Require Payment of Social Security Taxes for Home Workers

An amendment to Mexico’s Labor and Social Security laws was passed on July 2, 2019, that gives home workers the right to receive Social Security benefits (IMSS). People who employ workers in their homes must now pay Social Security taxes on their wages.

There is a period of transition for the implementation of this new Labor Law that extends until April 2021, at which time all of its provisions will be in effect. Until then, employers are at least required to guarantee all
medical expenses and funeral expenses for home workers.

Definition of a “Home Worker”

A “home worker” is a person who performs caretaking, cleaning, and assistance activities, or any other activity intrinsic to a home, and is paid for those services. This classification applies to workers who live on
the property where the services are provided, or those who reside elsewhere.

The following persons are NOT considered home workers:

Those who perform home labor activities sporadically or occasionally.
(I consider that this provision shall be clarified by court jurisprudence.)
Those who provide cleaning, assistance, client attention, or similar activities in hotels, retirement homes, restaurants, “fondas”, bars, hospitals, clinics, schools, and similar businesses.

Hiring a Home Worker

To hire a home worker, you should have a written contract, signed by the employee that includes at least the following:

Full name of the home worker
Full name of the home worker’s last employer
Address where the labor activities are to be performed
Starting date of the contract and duration, whenever drafted for a specific period of time
Type of work to be performed
Salary, the form of calculation, and payment dates
Hours of work
Annual paid vacation and daily and weekly rest periods
Housing and food provision, when applicable
Conditions relating to the termination of the labor relation
Tools to be provided for the right performance of the activities
Employee Benets Provided by the New Labor Law

Home workers who reside in their workplace:

Employers shall provide housing and nourishment to workers who reside in their workplace.
Home workers who reside in their workplace are entitled to a night’s rest of at least 9 consecutive hours, and a minimum rest of at least 3 hours between the morning and evening shifts. The workday may not
exceed 8 hours.

All home workers shall have the following labor benefits:

Holidays
Vacation bonus
Rest day payment
Mandatory access to social security
Christmas bonus (aguinaldo)
Other benefits agreed by the parties
A home worker has the right to enjoy 1.5 days of rest, preferably on Saturday and Sunday. By agreement, you can accumulate the half-day into a full day to be taken every 2 weeks.

Wages
The National Commission of Minimum Wages shall fix the minimum professional salaries to be paid to home workers.

Home workers are entitled to “overtime” if they do not receive the required free time, or if their hours exceed the 8-hour maximum workday.

The salary may be paid through a wire transfer or any other monetary payment to the worker as he/she may agree.

Termination Workers may terminate a labor contract, any time, with minimum 8-day advance notice to the employer.

Employers may terminate a labor contract within the first 30 days of the starting date of the contract without advance notice or severance compensation. After that, employers must give the worker a minimum 8-day advance notice and make any severance payments as required by the Labor Law.

Attorney’s Advice

In Mexico, workers who are registered with the Social Security office (IMSS) by their employers who pay the related taxes on their wages, receive free medical care for themselves which can also be extended to other members of their family. It is their “medical insurance plan.”

Medical care is a human right. Even prior to this change in the Labor Laws, I have always advised my clients to register their home workers with the Social Security office (IMSS) and to pay the tax contributions. I
also firmly believe that when a worker is insured, the employer is also protected. Now, this will be required by law.

* About the Author: Agustin Galindo is a Mexican Attorney at Law with a Master in International and Comparative Law from Southern Methodist University with a tax degree from ITAM in Mexico City.

Source: http://imagine-mexico.com



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