Mexican businesses cut salaries of outsourced employees
Businesses in Mexico are reportedly cutting the salaries of their employees since May this year, as many employers are struggling to comply with the country’s new labor outsourcing regulations.
The country passed a reform in April 2021 that prohibits subcontracting labor to third party service providers.
Since then, data from the Institute of Social Security (IMSS) shows that over 2.5 million outsourced workers were immediately hired directly by their employers in the initial three-month transition period.
About 77% of them saw a slight increase in their salaries, while the others had a reduction in their wages.
As if August 20, there are still about 50,000 businesses who have not yet submitted their compliance with the law. The deadline for compliance is on September 1.
Business analysts in the country are expecting at least 10% of subcontracted employees to lose their jobs because of these new regulations.
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