The recent initiative to cut the 48-hour work week to 40 hours seeks to level the playing field in labor markets and improve labor conditions in Mexico, in order to comply with one of the main commitments of our country (Mexico) with our North American trading partners (USA and Canada), under the renegotiated T-MEC treaty.
While the legislative process is aimed at approving the reduction of working hours and adding to recent labor benefits such as increases in minimum wages and vacation days, it is important to mention the need to analyze the financial and labor effects and to foresee the impact on company structures, labor markets and the economic environment.
A reduction in the workday operationally implies an adjustment in the activities to be carried out, modifying plans, following up on the fulfillment of objectives, deadlines for their completion, and most likely the hiring of new collaborators or the payment of overtime, facts that will surely lead to an increase in labor costs.
Hiring expectations may become more stringent, requiring greater preparation and experience from the candidates to be hired, and labor strategies will strive to retain talent, seeking to achieve objectives more efficiently and within the established timeframe, considering of course the work period (new working schedule).
The monitoring and control of attendance and tardiness during the workday will undoubtedly be a point that will be taken care of and could lead to conflicts in labor relations.
According to our approach the effects of reduced working hours will be:
IN FAVOR: greater family coexistence of workers, improvements in physical and mental health and the possibility for more women to integrate into productive life.
AGAINST: severe impact on labor costs, lack of competitiveness and inability to meet market demand.
For corporate directors and entrepreneurs, the challenge will be the implementation of plans and programs oriented to adapt to this labor modification, and the achievement of balance and financial viability, maximizing the resulting aspects in favor.
Today, more than ever, it is imperative to have specialized advice focused on the achievement of results and career plans. Being prepared for the impact represents the key to minimize it or take the best alternatives. Our firm has specialized executives who will be pleased to assist and advise you.
Published on August 24th, 2023
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