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Hiring employees & recruitment requirements in Mexico


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Mexicos large and educated population, proximity to the USA and diverse range of FTAs make it an attractive region to engage in commercial operations. Before jumping in and hiring staff in Mexico, you will need to consider the method by which you will hire local staff. Depending on your business needs, you may hire staff through a local legal entity, or through a Professional Employer Organisation (PEO).

Ensure that you are aware of Mexican employment law before hiring staff by viewing our short presentation below, created by our legal team in Mexico City.

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Hiring employees & recruitment requirements in Mexico

  1. 1. Hiring Employees + Recruitment Requirements in Mexico
  2. 2. Key Considerations: Employment Find below, some of the key considerations that should be taken into account before contracting staff in Mexico Yes – 30 days Is there an employee probation period? Yes Do staff need a local employment contract? Yes Can expatriate staff be hired? Minimum of 6 days Vacation entitlement Max employer contribution is MX $264,027 Total cost of employment Employers Who manages withholding tax? • Christmas Bonus • Vacation Bonus • Profit Sharing • Medical Insurance Employee benefits
  3. 3. Pathways to Hiring Staff Through a local legal entity Through a PEO solution: Professional Employer Organization
  4. 4. Forming a Legal Entity in Mexico In Mexico, there are (3) main types of legal entities: Corporations (SA or SA de CV), Limited Liability Company (S de RL) and the Mexican Investment Promotion Company (SAPI) Advantages: • Greater control of your employees • Better knowledge of local market, laws and regulation • Viewed more positively than a PEO solution Disadvantages: • High set-up/ongoing costs • Administration involved in managing a local company • Accounting and tax obligations
  5. 5. Professional Employer Organization Advantages: • You can operate without forming and maintaining a local entity • Limited legal responsibility • Cost-effective way to convert international contractors into employees Disadvantages: • The PEO becomes a co-employer • Loss of control • Costs involved with PEO services • Compromised company culture International PEO is a method to employ staff without having your own company
  6. 6. Are you looking to hire staff? As you are now aware, you have two options to hire staff: a) Through a Local Legal Entity or b) Through a PEO solution Need assistance hiring employees? Partner with Biz Latin Hub to learn how we can support you and your business in Latin America
  7. 7. Doing Business in Mexico? Learn More Here! Business Opportunities in the Mexican Automotive Industry Service Company Registration in the Energy Sector – Mexico Company Formation Corporate Law Firm Mexico: How Can We Help With Doing Business?