OUTSOURCING AND
SUBCONTRACTING OF PERSONNEL
All persons or companies
that have employees and/or subcontract the services
of personnel should be informed of the new
regulation in the Federal Labor Law for outsourcing
and subcontracting and avoid noncompliance to their labor
obligations.
The changes in the Labor
Law for subcontracting are the result of some abuses
from the companies that provide personnel and
companies that contract outsourcing services to
avoid labor obligations, taxes, benefits, social
security, etc.
Subcontracting is
defined as an Employer, referred to as the
Contractor, who executes works or services with
their own subordinate workers for a Contracting
party that can be an individual or company who sets
the tasks of the Contractor and supervises the
execution of the services or the works that are
contracted. In order for this type of relationship
to exist, it is obligatory to comply with the
following conditions:
1. The activities of the
subcontractor cannot be equal to or similar to the
activities carried out in the workplace.
2. The subcontracting
relationship must be justified by the specialized
character of the work or service performed.
3. It cannot include tasks
that are equal or similar to those that are
performed by the rest of the workers in the service
of the Contracting party.
When the preceding
conditions are not met, the new article 15-A of the
Federal Labor law stipulates that the Contracting
party, the beneficiary of the services, will be
considered the Employer for all the effects of the
Law, including Social Security obligations, profit
sharing, etc.
And the reformed Article
13 states:
“Article 13.
Established companies that contract work using their
own materials sufficient enough in quantity to
qualify for the obligations inherent in labor
relations, will not be considered intermediaries,
but employers. In case of a conflict, they will be
jointly responsible with the direct beneficiaries of
the labors and services for the obligations
contracted with the workers.”
The contract that is
entered into for the subcontracting of the rendering
of services must be in writing.
In addition the following
obligations are established for the Company that is
subcontracting the services of personnel.
1. At the moment of
execution of the contract, it must be verified that
the Contractor has the documentation and elements to
comply with all the labor obligations derived from
their workers (R.F.C., Social Security, INFONAVIT,
and all labor benefits). Companies that are using
the services of Subcontractors must have a clear and
concise written policy for subcontractors.
2. The contracting company
must also verify that the Contractor complies with
health and safety and environmental standards as
they relate to the personnel of the Contractor.
(health and safety documentation, training, personal
protective equipment, medical examinations, etc.)
The fine for the
Contracting company for not having a written
contract and verifying compliance to the labor
obligations of the Contractor is 250 to 2,500 times
the daily minimum wage. This fine can be multiplied
times the number of workers affected.
“Malicious” subcontracting (subcontratación dolosa)
is prohibited. This is defined as when the
Contracting party transfers deliberately his workers
to the subcontractor for the purpose of diminishing
labor rights; in this case, the parties are liable
for a fine of 2,500 to 5,000 times the minimum
general wage for every affected worker.
The other situation
addressed in the reforms to the labor law is the
situation where affiliated companies, such as
Shelter operations, where one company provides the
capital, equipment, raw materials, or the commercial
distribution of goods and services, but has no
personnel of its own, and another that provides the
workers. The services provided include the totality
of activities and there is no specialization
character; consequently, the contracting party is
considered the Employer for all the applicable legal
effects.
I think I should remind
the reader that Article 14 of the Mexican
Constitution states that “no Law will be applied
retroactively to the detriment of any person.”
Companies that find themselves not in compliance
with the reforms to the Labor law that took effect
Dec. 1, 2012 should bring themselves into compliance
in a reasonable amount of time. After a very
detailed review of the reforms, I have found several
errors that depending on their application could
provide an argument for the unconstitutional nature
of the reforms.
I should also remind the
reader that the concept of joint responsibility has
already been established in the Social Security law
and that this reform to the Labor law was an update
of the current law to coincide with the practice and
obligations of other laws.
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