Currency: Mexican Peso (MXN) (Rate)

Public Holidays: 9 public holidays (see here)

Employer taxes & benefits: 30-35% of salary

Official Language: Spanish

Payroll frequency: Monthly / Bi-Monthly

13th / 14th Salary: Mandatory 13th salary at end of the year

3 things to know about employing in Mexico

  1. There is a mandatory Christmas Bonus (aguinaldo) in Mexico which is typically 15-30 days of salary given to the employee in December; there is also a vacation premium, no less than 25% of daily pay, that is given for the days the employee takes vacation
  2. There is actually no obligation for employers or employees to provide any notice period in advance of dismissal or resignation - notice periods can only be enforced if agreed in advance
  3. Rather than require a notice period, all employees who are terminated for reasons other than gross misconduct (deception, unaccounted absences, physical abuse, harassment, etc) will be entitled to 3 months of salary as compensation.

Employment in Mexico

Paid Holidays

The minimum number of statutory paid holidays depends on the employee's length of service and varies upward from 6 days.

For example, an employee with 1 year of service is only entitled to a minimum holiday of 6 working days, while an employee with 5 years of service is entitled to a minimum holiday of 14 days.

In addition to the paid holiday entitlement, employees are also entitled to a vacation premium consisting of 25% of their base salary, payable during the vacation period.

Termination & Severance

Employees terminated without cause are entitled to claim reinstatement or severance in the amount of:

Common Employee Benefits

While not legally required, in Mexico, it is very common to offer team members private health insurance as well as a grocery coupon card (vales de despensa)

Working Hours

Normal working hours cannot exceed an average of 8 hours a day and 48 hours per week.


An employee is required to work up to three hours of overtime a week, and a total of nine hours in a week, at double the normal hourly rate. An employee can choose to work more than nine hours of overtime, but must get paid 3 times the normal hourly rate.


Employees may be eligible for Maternity, Paternity, Parental or Adoption Leave.

Minimum Wage

Minimum wage is: MXN 185.56 for the 43 municipalities. For others it is MXN 123.22.

Statutory Notice Period

There is no statutory notice period.

Sick pay and time off

Employees are entitled to a maximum of 52 weeks’ paid sick leave through the national social security system (IMSS). Employees may also be entitled to unpaid time off in certain circumstances.

Non-compete agreements

Non-compete agreements are considered unconstitutional in Mexico; for them to be enforceable with the employee's consent. Employers may offer financial incentives for a former employee to voluntarily abide by non-compete restrictions by paying them a lump sum of an agreed-upon amount of money during the time of employment.


Employee taxes

Employee Social contributions (10.15%)

Sickness & Maternity: 5.25%

Disability & Death: 1.75%

Layoff and Retirement Benefits: 3.15%

Employee Income tax

Up to 6,942.35 MXN: 1.92%

6,942.35 - 58,922.27 MXN: 6.40%

58,922.27 - 103,550.51 MXN: 10.88%

103,550.51 - 120,372.95 MXN: 16.00%

120,372.95 - 144,119.39 MXN: 17.92%

144,119.40 -290,667.83 MXN: 21.35%

290,667.83 - 458,132.39 MXN: 23.52%

458,132.39- 874,650.11 MXN: 30.00%

874,650.11 - 1,166,200.11 MXN: 32.00%

1,166,200.11 - 3,498,600.11 MXN: 34.00%

Over 3,498,600.11 MXN: 45.00%

Employer taxation (Up to 22.75%)

Sickness & Maternity: 5.25%

Disability & Death: 1.75%

Retirement: 2.00%

Layoff and Retirement Benefits: 1.75%

Child Care: 1.00%

Work Related Accidents: 0.50% - 3.00%

Housing Tax: 5.00%

Payroll State Tax: 0.50% - 3.00%