Vacations

September 24, 2007
Vacations

The Federal Labor Law (Ley Federal de Trabajo or LFT) contains, in Articles 76 through 81, express provisions stating that for each year ofwork an employee completes, such employee shall have the right to paid vacation time. Vacation time consists of paid days at normal salaryrates, it being the spirit of the Federal Labor Law to a vacation day for each year of services provided to the employer, which results in anobligation on the part of the employer to grant such vacation days within a maximum timeframe of six months after completion of the year ofservice. The Law does not contemplate compensation for an employee not taking vacations. In this manner, after an employee completes oneyear of service, the employer must give six days of paid vacation and two additional days for each year of service until reaching 12 days total,after which fourth year, vacations are increased to two days per five-year period of time worked. In the case of non full-time employees,whether working on a temporary basis or for a fixed project term, such employees may enjoy vacations in proportion to the number of days theywork during the year. Mexican law requires employers to publish annually a list of employees and seniority, including the dates suchemployees will have vacations. In addition, in case an employee meets all his or her obligations, the vacation period must take place within sixmonths after the first anniversary of employment, which must be taken during such six-month period. On top of full payment of salary duringpaid vacation time, employers must pay a 25% vacation bonus, which is consistent with the LFT’s policy of providing employees withadditional income to offset special expenses incurred during vacations. While this article mentions the vacation periods and minimum amountsthat are obligatory under the LFT for vacation pay and vacation bonuses, some companies pay more than the legal minimums discussed herein.

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