Note published on October 29 in El Universal, Cartera [Portfolio] Section by Rubén Migueles and Antonio Hernández
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One of the strategies for retaining talent at their jobs is the improvement of the benefits offered by the company, such as the teleworking bonus, which seeks to provide support to workers who work remotely or in a mixed modality in the payment of some expenses such as electrical power or internet services and the proposed reform to the Federal Labor Law (LFT) to increase the number of vacation days.
This initiative seeks to increase the number of days to be enjoyed from six to 12 in the first year, from eight to 14 on the second, from 10 to 16 on the third and so on, also increasing the vacation bonus paid by the company. Thus, the longer vacation periods provided by some Firms in order to be more competitive would consist of fewer vacation days in comparison to those sought to be granted by the reform.
The proposal is being discussed in the Senate committees and, as it has the support of the legislators of the majority of the parties, it is likely that it will be approved in the first two weeks of November or in the second two weeks of that same month, to become effective one day after its publication in the Official Gazette of the Federation (DOF).
“It will be a very important change but, in truth, it should not come as a surprise, because we are one of the countries of the Organization for Economic Cooperation and Development (OECD) with the shortest vacation periods”, said Ricardo Martínez, a specialist in labor matters and partner of the De la Vega & Martínez Rojas Law Firm.
This, he said, will require a great effort by the company, which must increase its levels of productivity to cover those six additional days in which the worker will be absent.
From his perspective, this measure will increase the worker’s productivity and will reduce the possibility of his quitting.
“Many workers say, ‘I will not stay in this job for six days of vacation’ and leave. That is why there is so much personnel turnover but, if they talk about twelve days, well, it becomes more interesting.”
Additionally, it will entail an increase in the costs to be paid by the employer, as the number of days of time off to be paid increases, which raises the vacation bonus. Since this bonus is included in the base salary for computing social security dues and benefits, the payments made by the employer to the IMSS [Mexican Social Security Institute] and to the Infonavit [National Workers’ Housing Fund Institute] will also increase somewhat.
Productivity programs must be sought in order to prevent this cost from negatively affecting small and medium-sized companies, which are responsible for 80% of employment in the country, he added.
