MEXICO: An Introduction to Labour & Employment

Joining the Global Trend: Mexico Considers A 40-Hour Workweek

Understanding the current landscape

Labour law in Mexico is changing – and fast. Over the past ten years, the country’s employment regulations have been transformed through various reforms aimed at improving workers’ rights and adapting to modern workplace needs. These changes have often been driven by political agendas or Mexico’s commitments to international agreements like the United States–Mexico–Canada Agreement (USMCA).

Today, in 2025, companies doing business in Mexico must deal with a legal environment that is not only complex but constantly evolving. New rules can be passed and implemented quickly, leaving little time for companies to adjust. Employers must now take a more proactive approach to compliance – by updating policies, conducting audits and keeping clear, accurate documentation to avoid legal risks and fines.

At the same time, the rise of social media has made information about employee rights more accessible. While this has helped raise awareness, it has also created room for confusion, as not all information shared is accurate. Companies now face reputational risks online, in addition to the need to ensure legal compliance.

There is also a growing number of workplace complaints related to discrimination, harassment and inequality. Employees are more informed and more willing to speak up, which means businesses need to improve internal procedures and take stronger preventive measures.

In this context, one reform in particular is creating headlines: the proposal to reduce Mexico’s standard workweek from 48 to 40 hours.

The 40-hour workweek: a big change is coming

One of the most talked-about labour reforms proposed in recent years is the initiative to reduce the maximum legal workweek from 48 to 40 hours. This would require amending both the Mexican Constitution and the Federal Labour Law to establish a new cap of 40 hours per week.

Although the reform has not yet been approved, dialogue round-tables initiated by the federal government are being held, involving representatives from various productive sectors, business chambers and unions who are evaluating its potential impact and discussing the possibility of a phased implementation, starting in 2026 and aiming for completion by 2030.

This initiative aligns with global trends focused on improving work-life balance and supporting employees’ mental and physical well-being. However, the practical implications are complex – especially for companies in sectors like manufacturing, mining, logistics, retail and services, where extended workdays remain common due to operational demands.

If approved, the 40-hour workweek will represent a major structural change for businesses, requiring thoughtful planning and adaptation to maintain productivity while complying with the new limits.

How things work today

Under current Mexican law, employees working a day shift (between 6am and 8pm) may work up to a maximum of 48 hours per week. For night shifts (between 8pm and 6am), the maximum is 42 hours per week. For mixed shifts (which include both daytime and nighttime hours), the maximum allowed is 45 hours per week; any additional hours must be paid as overtime.

As part of the ongoing discussions regarding the 40-hour workweek reform, adjusting the current limits for night shifts (42 hours) and mixed shifts (45 hours) – to a maximum of 40 hours per week – is also being considered. In fact, one proposal is to eliminate the concept of the “mixed shift” altogether, as it would no longer be necessary under a uniform 40-hour limit.

What this means for employers

The new reform would not allow companies to reduce salaries when cutting hours, which means businesses would have to do more with fewer hours – or pay more to maintain the same level of productivity.

If the 40-hour week becomes law, companies will need to make important adjustments. Some of the biggest challenges they might face include:

• reorganising operations – companies may need to hire more staff and/or change their work schedules to keep things running smoothly;
• higher labour costs – since salaries would remain the same, reducing hours would mean a higher cost per hour worked, and overtime could also increase;
• union negotiations – unionised workplaces may face pressure to reopen collective bargaining agreements to include the new rules; and
• legal compliance – internal policies, employment contracts and payroll systems will need to be updated, and more government inspections may also follow.

How to prepare

To stay ahead, companies should start planning now — even though the reform has not yet been passed. Steps to consider include:

• reviewing the roles and departments that would be most affected;
• evaluating existing contracts and collective bargaining agreements for necessary changes;
• calculating the potential financial impact of hiring more personnel and/or paying more overtime;
• exploring more flexible work arrangements or automation to keep productivity stable; and
• communicating clearly with employees to manage expectations and explain any changes.

What is next?

Mexico’s new president, Claudia Sheinbaum, has made it clear that protecting workers’ rights is a priority during her 2024–30 term. Her administration is already pushing for changes that could reshape how companies manage employees.

One of her key promises is to raise the minimum wage sufficiently for a worker to afford two and a half times the basic cost of living (canasta básica) by 2030. This means annual increases above inflation and could lead to pressure to raise wages across the board.

Sheinbaum has also moved quickly to formalise work on digital platforms. Just days into her term, she passed a reform requiring platforms to register their workers with Mexico’s social security system. This puts more responsibility on companies, who now must meet social security obligations.

This reform took effect on 22 June 2025. In parallel, the Mexican Social Security Institute (Instituto Mexicano del Seguro Social; IMSS) launched a pilot programme to support the implementation. The programme mandates platforms to register as employers and enrol eligible workers based on minimum-wage criteria – even for those earning below the threshold, who will still be covered for workplace injuries. The pilot includes a six-month transition and aims to guide broader labour protection for platform workers.

Other labour proposals under discussion include:

• increasing minimum mandatory benefits, such as (i) the Christmas bonus; (ii) the vacation bonus; (iii) paternity leave duration; and (iv) the seniority premium.
• hiring quotas – companies with over 20 employees may be required to hire a certain percentage of workers over 60 of age; and
• gender pay gap measures – policies to reduce gender-based wage disparities are being considered.

If approved, these reforms will require companies to rethink their budgets, benefits strategies and HR policies. They can also expect more inspections and stricter enforcement by the Ministry of Labour.

Do not forget the global picture

Mexico’s labour laws do not exist in isolation. Political shifts in the United States – especially with Donald Trump now in office – may also affect labour policy, particularly around trade rules and compliance with USMCA standards. For multinational companies, staying informed about these changes is essential.

Conclusion

The proposal to reduce the workweek to 40 hours is more than just a legal change – it is a signal that labour policy in Mexico is entering a new phase. The focus is on giving workers more protection, better conditions and stronger rights.

For employers, the key is to be proactive. Staying informed, preparing for change and updating internal systems and strategies will be essential. Legal and HR teams must work together to ensure compliance, support employee well-being and keep the business running smoothly in a changing legal landscape.