Third Stage Labor Reform

On May 1, 2019, the decree by which several provisions of the Federal Labor Law and other related laws were amended, added and repealed was published in the Official Gazette of the Federation. Such reform focused on the creation of a new labor justice system and modifications in collective bargaining.

The implementation of such reform was divided in three stages of application throughout the national territory; the third and last stage began on October 3, 2022, according to the Official Gazette of the Federation’s publication of September 20, 2022.
The third stage will be implemented in the following entities:

• Chihuahua - based in Chihuahua and Ciudad Juarez. • Mexico City
• Coahuila - based in Saltillo and Torreón
• Durango, the municipalities of General Simón
Bolívar, Gómez Palacio, Lerdo, Mipimí, Nazas, San Juan de Guadalupe, San Luis del Cordero, San Pedro del Gallo and Tlahualilo.
• Jalisco - based in Zapopan
• Michoacán - based in Morelia
• Nayarit - based in Tepic
• Nuevo León - based in Monterrey
• Sinaloa and Islas Marías archipelago - headquartered
in Culiacan
• Sonora - headquartered in Hermosillo
• Tamaulipas - based in Ciudad Victoria, Tampico and
Reynosa
• Yucatán - headquartered in Mérida
The rest of the states were part of the two previous stages.

The main changes brought about by the application of the Labor Reform are:

Labor Conciliation Centers

This authority will be in charge of the pre-judicial stage of labor disputes; the intervention of the Center will seek to reach an agreement between the parties in order to avoid reaching the trial stage before the new Labor Courts, part of the Judicial Branch.
It should be noted that the filing of the conciliation request suspends the statute of limitations of the labor action and the conciliation process may not exceed 45 calendar days. In the event that the duly notified employer does not appear at the conciliatory stage, it will be subject to a fine of between 50 and 100 times the Unit of Measurement and Updating (UMA) (approximately $4,811.00 to $9,622.00 pesos/ $240.55 to $481.10 USD).

Labor Courts

In the event that the conciliation process has been exhausted without reaching an agreement between the parties, the Center will issue a Certificate to proceed to the judicial stage. In this case, once the employer has been notified of the claim, it will have 15 days to answer the claim and offer the evidence it deems pertinent.

Principles of Union freedom and democracy

The purpose of these mechanisms is to allow employees to have a greater say in the process of joining a union, thus participating in the election of officers, and approving the content of the Collective Bargaining Agreements that govern them.
It is important to highlight that the unions still have a deadline of May 1, 2023, to carry out the process of legitimization of Collective Bargaining Agreements, a process in which the company should not have any participation whatsoever.

Federal Center for Conciliation and Labor Registry

This authority is the body responsible for carrying out conciliation in federal matters, registering associations, collective bargaining agreements, internal labor regulations, as well as carrying out procedures of union democracy and collective conflicts.

In addition to the above, employers are advised to pay special attention to the following three issues:

I. Perform an exhaustive review of the documentation required to carry out an efficient labor practice within the company (5 Joint Commissions, internal work regulations, protocol to prevent discrimination and harassment, protocol in compliance with NOM- 035, Collective Labor Agreement, Regulation for Home Office, if necessary, documents related to registration with IMSS and INFONAVIT).
II. Have a duly documented internal labor file for each of the employees hired, which must contain at least the individual employment contract, payroll receipts, administrative records, receipts for payment of any other benefits such as vacations, Christmas bonus, bonuses, commissions, Profit Sharing (PTU) payment receipt, registration before IMSS and INFONAVIT, attendance control, and any other document related to the provision of services.

In the event of termination of personnel, have the employee’s labor file, as well as the appropriate documentation of the termination of the labor relationship.

Finally, pay special attention to comply with the necessary requirements before the REPSE, at the moment of rendering or receiving the rendering of a Specialized Service, remembering that these are any that are different from the corporate purpose or the preponderant economic activity of the company.

Alejandro Nila Rosales
Sainz Abogados