Mexican Labor Law and the Mexican Cross Border Trucking Debate

Mexican truckers such as these are covered under Mexican Labor Law which dictates HOS, benefits, employee rights etc. Photo- Guillermo Arias/Associated Press

Much of the misinformation coming from opponents of cross border trucking with Mexico seems to be coming from ignorance of the country rather than deliberate attempts to misinform the public, I’d like to think, at least where the regulatory structure in Mexico is concerned.

Two of those issues that have been forcibly pushed on the public is lack of Hours of Service Regulations in Mexico and what some perceive as a “weak” or non existent regulations for the Mexican trucking industry. Regulations of the trucking industry in Mexico is neither of those.

The differences are enormous as trucking journalist Tim Brady points out in his article REGULATING TRUCKERS.

Brady writes;

Mexican Truckers’ regulations are consequence regulations. If a Mexican trucker makes a mistake–consequences: the Mexican government will take away his ability to operate a commercial vehicle for a period of time. If he causes an injury in a preventable accident–he will lose that privilege for the rest of his life; if there is a fatality–the trucker goes to jail for years. Mexican truckers are required to have work visas to drive in the US; the cost and time it takes to get one in itself becomes a deterrent for being unsafe.

In contrast, the U.S. babysits its truckers and attempts to micromanage every 15 minutes of a trucker’s life through the Hours of Service, EOBRS etc. It is a different view of how to manage the safety of truckers.

MEXICAN LABOR LAW AS IT APPLIES TO THE MEXICAN TRUCKER
Unlike in the United States, Mexican employee rights are constitutionally guaranteed. Mexican labor law has its foundation in Article 123 of the Mexican Constitution, and is implemented through a number of Federal laws, including, the Federal Labor Law (Ley Federal del Trabajo), the law regulating the National Housing Fund for Workers (Ley del Instituto del Fondo Nacional de la Vivienda para los Trabajadores), the Social Security Law (Ley del Seguro Social) and others. The Federal Labor Law, was first adopted in 1931, and amended in 1970.

For those interested, the Labor Laws of Mexico can be downloaded HERE. Rules specific to the Mexican trucking industry are found in Chapter 6 on page 50 titled “Trabajo de Autotransportes”.

Let’s take a look at the law that covers the commercial driver in Mexico.

Article 256 .- The relationship between truck drivers, drivers, operators, collectors and other workers serving trucking board public service of passenger, cargo or mixed, or urban outsiders, such as buses, trucks or cars, and owners or licensees of the vehicles are working relationships and are subject to the provisions of this chapter.

The stipulation in any way misrepresented the provisions above, produces no
legal effect, nor prevent the exercise of rights arising from services rendered.

Article 257 .- The salary is fixed per day, per trip or by ticket sales or by circuit or kilometers routes and will consist of a fixed amount, or a premium income or the amount that exceeds
a given income or in two or more of these forms, under no circumstances be less than the minimum wage.

When the salary is fixed per trip, workers are entitled to a proportionate increase in case
to extend or delay the normal term of the journey because they do not attributable.

Wages can not be reduced by shortening the journey, whatever the cause.

In urban transport or circuit, (intercity bus drivers) workers are entitled to be paid the salary in the case of service interruption due to causes beyond their control. It violates the principle of equal pay provision stipulating the different wages for equal work, if it is provided in lines or services of different categories.

Article 258 .- In determining the salary of days off will be increased to perceive the
work in the week, with a sixteen hundred sixty-six.

Article 259 .- In determining the amount of the salary of holidays and
compensation are subject to the provisions in the second paragraph of Article 89.

Article 260 .- The owner of the vehicle and the licensee or permit holder are jointly
responsible for the obligations arising from labor relations and law.

Article 261 .- It is forbidden to workers:

I. The use of alcoholic beverages during the service and the twelve hours before
beginning work;

II. Use narcotics narcotics or drugs in or outside their working hours without a doctors prescription. Before starting the service, the employee must bring the matter to the attention of the employer andpresent the prescription signed by the physician, and,

III. Receive freight or passage out of the places mentioned by the company for such purposes.

Article 262 .- The workers have special obligations as follows:
I. Treat them with courtesy and dedication passage and cargo with caution;

II. Undergo periodic medical examinations prescribed by law and other rules
work;
III. Caring for the proper functioning of the vehicles and inform the employer of any faults observed;

IV. Make the journey emergency repairs to enable their knowledge,
tool and parts available to them. If you can not make repairs, but the vehicle
can continue to run, drive to the nearest village or to the place fixed for
repair, and

V. Observe traffic regulations and the technical specifications prescribed by national authorities or the employer.

Article 263 .– The employer has the following specific duties:

I. In the long haul transport, will pay for accommodation and meals for workers
when trip is prolonged or delayed for reasons that is not attributable to them;

II. Make repairs to ensure the smooth operation of the vehicle and the safety of
workers, consumers and the general public;

III. Provide vehicles and spare parts essential tool for repairs
emergency and

VI. Observe all traffic regulations on operating conditions and
vehicle safety.

Article 264 .- The special causes of termination of employment relations:

I. Refusal to make the trip contract or its termination without cause. be considered
in any case cause the fact that the vehicle meets the safety
essential to safeguard the lives of workers, users and the public in general;

II. And reiterated the significant decrease of revenues, unless circumstances
justified.

Amazing isn’t it? In the United States, we are considered unskilled labor by the US Department of Labor, and have no specific protections other than those spelled out under OSHA, and various employment laws, which in most cases provide protection for the employer rather than the employee. So let’s recap what we’ve learned.

  • ARTICLE 256 establishes the purpose of the chapter and those who are covered by this segment of the law.
  • ARTICLE 257 establishes how the driver is paid and restricts deductions, protects pay in event something occurs beyond the control of the driver.
  • ARTICLE 258 establishes the salary and the work week which we’ll discuss further in this article
  • ARTICLE 259 establishes the salary to be paid for holidays and weekends as we’ll discuss later
  •  ARTICLE 260 establishes that the owner or license holder of the vehicle is responsible for compliance with the applicable provisions of this law
  • ARTICLE 261 Prohibits workers from (1) using alcohol during working hours or for 12 hours prior to reporting for duty, similar to the US rules from FMCSA, (2) Prohibits the driver from using drugs inside or outside of work unless prescribed by a physician, again, similar to US FMCSA rules. and (3) prohibits drivers from accepting hauling freight or passengers outside of their normal duties,  ie: bootleg freight or contraband.
  • ARTICLE 262 establishes the workers obligations to their jobs and to their employer.  Notice how these codified requirements meet or exceed the regulatory standards under FMCSA rules.  (1) Courtesy towards their passengers and care for their cargo as applicable. (2)  Submit to medical examinations as required by their employers, Federal Police for cause and to obtain their Mexican CDL under the rules of the SCT (Secretariat of Communications and Transport), (3) Pre-trip inspections of their vehicles and reporting of problems found to their employers. (4) Make emergency repairs to their vehicle with parts and tools available, and if not able to do so, and the vehicle can safely make it, take it to the nearest place for repairs. (5) Observe all traffic regulations, State, Federal and Municipal and follow all orders of the employer.
  • ARTICLE 263 codifies the responsibility of the employer towards the employer. (1) The employer is required by law to pay for the truckers hotel and provide a per diem for the driver when out overnight. (2) Keep the vehicle in safe and compliant working order to protect the employee and the general public. (3) Provide repair services to keep the vehicles road worthy. (4) Compliance with all applicable Federal, State and Municipal regulations. In other words, cannot force or require the worker to break the law.
  • ARTICLE 264 establishes the reasons an employer can terminate an employee for cause. Remember, in the US, unless you’re union, you work at the pleasure of your employer and can be terminated for any reason or no reason. (1)  Refusal to accept a trip assignment, abandoning a truck or load before delivery if the vehicle is safe and complies with all applicable rules, laws and regulations. (2) Who the hell knows what that means
So there you have it peeps. A law that protects the employer and the employee, lays out the responsibility of both parties and gives the Mexican trucker rights that we don’t have in this country, or if we have them, are routinely abused by our employers.
But it is not all as cut and dried as it might seem. Mexico’s labor law also provides other instances which an employee, any employee in any industry can be terminated for cause. All of this is codified as law.

An employer may terminate an employee’s employment without liability only upon completion of the project,
upon expiration of the specified term of employment, or for cause as defined in Article 47 of the Federal Labor Law.

Article 47 lists 15 causes for termination:

  1.  the employee provides false references regarding her abilities, skills and qualifications for the job;
  2.  the employee is found guilty in the course of her employment of a dishonest or dishonorable action, violence, threats or ill-treatment towards the employer or any member of the employer’s family or top management or managerial personnel of the work place, except in cases of provocation or self defense.
  3.  the employee is guilty of any acts mentioned in the proceeding items towards any co-workers
  4.  the employee is guilty, outside of the work place, of any acts mentioned in item 2 above towards the employer, any member of the employer’s family or the top management or managerial personnel, in the said acts are of such a serious nature as to render the fulfillment of the labor contract impossible;
  5.  the employee intentionally causes material damage to the buildings, machinery, tools, raw materials or other items in work place
  6.  the employee causes damage of a serious nature, acting without malicious intent, but with negligence which is the sole cause of the damage
  7. the employee negligently or carelessly endangers the safety of the work place or persons therein
  8.  the employee is guilty of immoral conduct in the work place;
  9.  the employee reveals trade secrets or communicates matters of a private or proprietary nature to the determent of the business;
  10.  the employee is absent for more than three times in a period of thirty days without the employer’s permission or without sufficient excuse
  11.  the employee refuses to obey the employer or her representatives without sufficient reason in matters connected with the services the employee has agreed to provide
  12.  the employee refuses to adopt preventive measures to follow the procedures put in force for prevention of accidents or disease
  13.  the employee attends work intoxicated or under the influence of a narcotic or harmful drug, unless she has a medical prescription, in which case, she must inform the employer of her prescription and submit a certificate signed by a doctor;
  14.  an executory judgment sentencing the employee to a term of imprisonment preventing her from fulfilling her obligations under the labor relationship is issued
  15.  other grounds similar to those specified in the preceding paragraphs, if such grounds are of equal gravity and entail similar consequences.

In the event of termination for cause, the employer must give written notice to the employee of the date of the termination of her contract and the reasons for termination. Failure to provide written notice of the reasons for termination shall be sufficient grounds to consider that the termination was not justified.

So even in the event of termination for cause in Mexico, both parties rights are protected, if the law is followed. But let’s say a trucker in Mexico is fired because his employer is having a bad day or for some of the reasons we get fired in the US, in other words, unjustified termination. If a US driver is fired, what rights does he have and what recourse against the employer? None that I am aware of. We serve at the pleasure of our employers.

However, in Mexico, ah, Mexico, that third world country to our south, with no rules or regulations, provides relief for the employee who thinks he has been wrongfully terminated and the onus of proof is on the employer.

Mexico has a Conciliation and Arbitration Board, which is an administrative agency charged with resolving labor disputes. An employee may file a complaint with the Conciliation and Arbitration Board demanding reinstatement or damages within two months of their discharge. The employer has the burden of proving that the employee was terminated for cause pursuant to Article 47 of the Federal labor law. If the employer fails to meets its burden of proof, the Conciliation and Arbitration Board may determine the termination was without justification and award appropriate relief to the wronged employee.

In the event that the Conciliation and Arbitration Board determines that the employer terminated the employee without justification, the employee has the right pursuant to Article 48 of the
Federal Labor Code to:

  •  Reinstatement of her job; or
  •  Compensation in the form of three months’ wages based upon integrated compensation (i.e., as discussed above, all compensation, including benefits, that the employee can prove she received from the employer during the previous 2 years.

Article 49 of the Federal Labor Law provides that employers are not obligated to reinstate an employee, and the employee may not seek reinstatement, in cases in which: (1) the employee has not been employed with the business for at least one year; (2) the employee is an executive employee; (3) the reinstatement, given all of the circumstances, would be impossible; (4) if the employee rendered domestic services; or (5) if the employee worked part time.

Article 49 requires that if the employee requests reinstatement and is entitled to reinstatement, but the employer refuses to reinstate, then, in addition to the three months’ compensation described in (b) above, the employer must also pay the indemnifications spelled out in Article 50 of the Federal Labor Law as follows:

  •  An amount equal to the total integrated compensation payable for one-half of the entire employment period if the employment was for less than one year, or an amount equal to six months’ integrated  compensation for the first year of service, plus twenty days’ wages for each additional year of service;
  • If the term of employment was indeterminate, then the compensation shall be twenty days’ wages for each year of service; Furthermore, in any event, the employer shall also pay the entire amount of integrated compensation due to the employee from the date of dismissal to the date on which the compensation is paid.

Finally, Article 162 of the Federal Labor Law mandates that the employer still has to pay a worker dismissed with or without cause, as well as an employee who resigns with fifteen years or more seniority, a seniority premium equal to twelve days’ salary for each year of service rendered. The seniority premium may not, however, be greater than two times the minimum salary then in effect in the economic zone where the employer is located.

MEXICAN TRUCKERS PAY IN MEXICO NOT WHAT YOU THINK

Another objection to the Mexican trucks in the US, is that Mexican truckers are not paid at a rate, equal to a US driver. Well, neither or the Canadians. However, in Mexico, driving a truck is a skilled profession and the truckers are well regarded by the populace. With weekly pay or salary in Mexico averaging $150.00 for a 46 hour week, a Mexican trucker earning $.15cpm and driving 2500 miles a week is earning a salary well above average. But in addition to basic wages, Mexican labor law, again codified thus requiring compliance by the employer.

Social Security (IMSS). Employers must  register employees with the Mexican Institute of Social Security (IMSS) within five days of their hire date.  Employers must contribute a minimum of 17.42 percent of each worker’s salary, depending on the risk-factor of the job, into the social security fund. Employees and their dependents are entitled to IMSS benefits, including the following:

  • Retirement Benefits. Retirement is at age 60, with at least 1,250 weekly contributions. The benefit is calculated based upon a multiple of the minimum wage.
  • Survivor Benefits. Employees must purchase a life annuity with survivor benefits from a private insurance carrier using funds in their pension accounts.
  • Disability Pension. Employees must purchase an annuity with survivor’s benefits from funds in their pension accounts.
  • Medical Coverage. Mexican employees may use IMSS medical facilities for essentially all of their health care needs. The benefits provide coverage for a period of 52 weeks, which may be extended if the employee is still contributing to the plan.
  • Sickness Compensation. Employees are entitled to 100% of their earnings for up to 72 weeks. After 72 weeks, disability benefits take effect.
  • Maternity. Pregnant employees are entitled to 100% of their weekly wages for up to 6 weeks before and 6 weeks after delivery.
  • Funeral Grants. Eligible employees are entitled to a payment equal to up to 2 months of minimum wage.
  • Day Care. Eligible employees are entitled to have their children ages 43 days to 4 years cared in day care facilities free of charge to the employee.
  • Retirement Fund (SAR). Employers must contribute 2% of up to 25 times the annual minimum wage into the retirement fund. Employees may, but are not required to, contribute to the fund. The benefit is payable upon the employee’s death, disability, or reaching retirement age. The benefits are paid out for a maximum of 20 years.
  • Workers’ Housing Fund (INFONAVIT). Employers must contribute 5% of the employee’s earnings to the Workers’ Housing Fund. The funds are then placed into individual employee accounts to be used as a source of money for the employee to purchase a house, or as a source for low interest loans for the same purpose. If not used, the funds are paid to the employee uponr etirement, death or disability.

Additional benefits mandated by law include:

  • Christmas Bonus (Aguinaldo). Employers must pay employees who have been in their service for at least one year, a year end bonus equal to at least 15 days’ wages before December 20th of
    each year. By practice, the aguinaldo may be equal to 20 or 30 days wages. Employees who have worked for less than one year are entitled to a pro-rated aguinaldo equal to the portion of the year during which they have worked.
  • Vacation Premium. Employers must pay a vacation premium to employees equal to 25% of the wages payable during the vacation period.
  • Vacation. Employees employed for more than one year are entitled to at least 6 days paid vacation. Vacation leave is increased 2 days for each additional year up to a maximum of 12 days. Additionally, for every 5 years of service, 2 additional days must be added
  • Legal Holidays. Mexico has 7 paid legal holidays including: January 1 (New Year’s Day), February 5 (Constitution Day), March 21 (Benito Juarez Day), May 1 (Labor Day), September 16
    (Independence Day), November 20 (Revolution Day), December 25 (Christmas). In addition to those already mentioned, every 6th year when a new president is sworn into office, employees receive
    a paid day off on December 1 (Inauguration Day).
  • Profit Sharing. After the first year of business (there is an exemption for the first year of business), employers must pay employees an amount equal to 10 percent of the profits of the
    employer. This amount is to be paid annually. Certain executive and confidential/trust employees are not entitled to the profit sharing.
Can you believe it? Retirement benefits mandated by law and with no involvement of a labor union. Maternity benefits? Remember how big business fought against that in the US and now that we have it, a woman can take maternity leave, but with no compensation.
Free healthcare? I use the IMSS clinics at times, although I have to pay and they provide excellent services and care.
Vacation pay? Profit sharing?
Could it be, that Mexico, who everyone considers to be a third world country, is actually ahead of the curve, and perhaps it is the US that needs to catch up?

HOURS OF SERVICE IN MEXICO

One of the strongest objections opponents of cross border trucking have made is that Mexico has no hours of service regulation to control the hours their truckers operate. In the United States, HOS rules are established by the rulemaking process within FMCSA. In Mexico, Hours of Service rules for truckers are established by Constitutional mandate.

But the mandate is not specific to truckers, but to all workers, as shown above.  Hours of Service for truckers are set under Mexico’s Labor Laws, not the SCT, Mexico’s equivalent to the FMCSA.

Mexican labor law establishes the Work week, work day and other factors, which apply to the trucking industry as all other segments of the labor population.

The Work Week. The federal Labor Law of Mexico sets forth a maximum of 48 hours per week as the amount of hours a laborer can work without going overtime. Even so, most companies only run the work week at 40 to 45 hours

The Work Day. For every 6 days of work ( Monday through Saturday ), employees are entitled to one day of rest with full pay. In other words, you are working 6 days but being paid for 7, under the law.

Work Shifts. There are 3 work shifts, consisting of the day shift ( eight hours ), the night shift ( seven hours ) and the mixed shift ( 7 1/2 hours ). The mixed shift is part day shift and part night shift. Those hours that are worked over these periods are considered to be overtime ( paid as such – double the hourly rate ) and can not go over 9 hours per week. THIS IS THE PROVISION THAT ALSO COVERS MEXICO’S COMMERCIAL DRIVERS AND THUS IS A DEFACTO HOS LAW.

Mexican medical testing for Mexican Licencia Federal de Conductor
Upper Left: Mobil Medical Unit – Upper Right: Initial Exam – Lower Left – Part of Medical exam for LFC qualifications – Lower Right – Application line at Federal Testing Center

In a draft submitted to the Motor Carrier Safety Advisory Committee in September of 2010, a committee which Todd Spencer, Executive vice president of OOIDA is a member and surely has seen this memo, The SCT of Mexico shared a review of Mexican fatigued drivers.  The SCT found:

  • Only 38% drive between 5 and 8 hours a day
  • 62% drive more than 9 hours a day
  • 42% and 45% of passenger bus and truck drivers drive 9-12 hours a day and 0.7% are involved in fatal accidents
Results of the study show that 38% drive well below time mandated by Mexican labor laws. The 62% that drive more than 9 hours a day are not violating the law, but are also receiving double time for their work. The third line show us that their work days are pretty much in compliance with US HOS rules and Canadian rules which allow 13 hours a day of driving, compared to our 11 hours a day.
So far those who say Mexico has no drug testing, no way to check a drivers license history, the above SCT reports can prove differently.
For those who continue to claim Mexico has no HOS mandated, the Labor Laws of Mexico prove different.
And for those who claim the pay disparity between a Mexican driver and a US trucker will result in an unfair advantage to the Mexicans, consider all the benefits, mandated by Mexican law that the employer has to pay the Mexican trucker to be in compliance. It adds considerably to the cost to the employer and is a factual benefit to the employee.
In other words, OOIDA once again has lost all credibility when it comes to the Mexican truck issue.

I’ll close this with a modified quote from the esteemed trucking journalist Tim Brady from his article referenced above:

the side of the trucking industry who believe every trucker is an irresponsible adolescent who needs to be baby-sat every hour and mile they drive. And the side that’s drunk the Kool-Aid that says just because a country doesn’t regulate their truckers in the same micro-management manner the US does, they must be unsafe and dangerous. This lacks logic and common sense. Anyone knows the more you try and control any segment of the population, the more you will either dumb down the quality of those individuals – or they will revolt.

Perhaps there should be some revolt against those who have engaged in a deliberate campaign to smear the Mexican trucking industry and instill irrational fear into their members on a subject they no nothing about to satisfy their own self interests.

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This post is part of the thread: Mexico Trucking – an ongoing story on this site. View the thread timeline for more context on this post.