Taking advantage of the closure of this year, it is important to clarify the various doubts that many employers in Mexico have regarding their obligations regarding the salary increase for their employees. Conversely, this is a common question in all business sectors, as well as an expectation on the part of all workers who hope that at the beginning of a new calendar year, the amount of their base salary will be increased.
In light of this, it is essential to conduct a detailed analysis of the true obligations that exist for employers.
Firstly, we must refer to section A) of Article 123 of the Constitution, which concerns Article 570 of the Federal Labor Law empowers the National Minimum Wage Commission to annually set the amount of the national minimum wage, and it will take effect on January 1 of the following year. Likewise, Article 90 of the Federal Labor Law establishes that the annual setting of the minimum wage should never be below the inflation of the previous year. Therefore, there is an express obligation in the law for employers with personnel registered with a minimum wage to increase it once it is raised, starting on January 1 of each year. This should be reflected in regular salary payments, and employers are obligated to report this new salary to the Mexican Social Security Institute.
Now, what happens to those workers who earn more than the minimum wage? In this circumstance, it is important to confirm if the workplace is under a collective agreement. If so, the content of the agreement must be analyzed, as traditionally, collective labor agreements, and even some individual contracts, stipulate the obligation and commitment of the employer to grant annual salary increases. However, if there is no collective agreement or if it and individual contracts do not contain provisions that obligate the employer, or if the employer has not committed to providing these salary increases, there will be no legal obligation for the employer to carry out salary increases. The lack of an increase will not entail any legal consequences for these employers.
In these specific cases, it will be up to the employer to unilaterally decide whether to implement a salary increase or not. Also, it is always advisable for salary increases, as well as any other modifications to working conditions, to be properly documented. For this purpose, the labor team at Vega, Guerrero & Asociados is at your disposal to provide the necessary support and advice to carry out all these types of procedures.
