• English
    • Español (Spanish)

Payroll Plus MX

Simplifying Payroll Across Mexico
  • Home
  • About
  • Services
    • Payroll Plus Solutions
    • Payroll Plus +
    • Premium Consulting
  • Blog
  • Compliance
  • Our Offices
Home
|
Articles
|
Initiative to reform the retirement system in Mexico

Initiative to reform the retirement system in Mexico

Jul 27, 2020
Articles

On July 22, 2020, the Mexican government announced that it would send to Congress an initiative to reform the Social Security Law [in Spanish: la Ley del Seguro Social], seeking to strengthen the workers’ retirement pension system.

The goal of this reform is to increase the guaranteed minimum amount of the retirement pension, as well as to make the right to it more accessible for workers; this would be achieved by taking into consideration the following changes:

1.- Increase in the contributions to the worker’s retirement fund.

Currently, tripartite contributions allocated for retirement pensions amount to 6.5% of the workers’ wages, broken down as follows:

5.15% – contributed by the employer

1.125% – contributed by the worker

0.225% – contributed by the government

The reform initiative seeks to increase the percentages contributed by the employer and the contribution of the government will be segmented according to the workers’ income level, as follows:

5.15% to 13.875% – contributed by the employer (income from 1 minimum wage to 25 UMA´s)

1.125% – contributed by the worker

8.724% to 1.798% – contributed by the government (income from 1 minimum wage to 4 UMA’s)

Workers’ contributions are not modified, and the percentages will gradually increase over an eight-year period.  It is important to point out that the government’s contribution will be higher when the worker’s income is lower.

2.- Reduction in the number of quoted weeks to qualify for a retirement pension.

Currently, for a worker to be entitled to a retirement pension, he/she must, among other requisites, have a total of 1,250 quoted weeks. The modification to this requirement would reduce the number of quoted weeks to 750 and, in a ten-year period, would gradually increase to 1,000 quoted weeks.

With this, the government seeks to give more people access to a retirement pension.

3.- Increase the amount of the guaranteed minimum retirement pension.

Today, the minimum guaranteed retirement pension is MXN 3,289.00 per month on average. The reform initiative proposes an increase based on age, the number of quoted weeks, and the base salary of the workers that, on average, is MXN 4,345.00 per month.

These are the three key items of the reform. It is important to emphasize that this is part of an initiative that must be approved before its implementation. At Payroll Plus MX, we will keep you updated on this initiative, which we consider will have a significant impact on both employers and workers in Mexico.

boletin-17-payroll_compressedDownload
Posted by Hero Manager Jul 27, 2020 Categories: Articles IMSS, Mexico retirement, retirement, retirement system

Related Articles

The Pension System Reform
Resumption of deadlines for acts and procedures in charge of the INFONAVIT.
NEW VERSION OF THE SINGLE SYSTEM OF SELF-DETERMINATION [in Spanish: Sistema Único de Autodeterminación] (SUA) 3.6.0
Criteria for the return to activities for high-risk groups
Withholding for outsourcing services is added to Sinaloa’s State Tax.
In August, the IMSS Mailbox tool will start operating.

Search

Tags

2017 Article 42 Article 311 Article 429 benefits Capacitación CFDI CLABE Contingencia coronavirus COVID COVID-19 e-signature Employees FED FONACOT Impuesto sobre nómina IMSS Increase INEGI INFONAVIT Labor laboral labor obligations Ley Federal del Trabajo LFT LISSTE LSS Maternity leave minimum wage official gazette OMS Payroll Payroll Tax RFC RUNA salary SAT Tax Taxpayers TMEC UIF wage Webinar Youth Building the Future

Recent Posts

  • The Pension System Reform
  • Resumption of deadlines for acts and procedures in charge of the INFONAVIT.
  • NEW VERSION OF THE SINGLE SYSTEM OF SELF-DETERMINATION [in Spanish: Sistema Único de Autodeterminación] (SUA) 3.6.0
  • Criteria for the return to activities for high-risk groups
  • Withholding for outsourcing services is added to Sinaloa’s State Tax.

Archives

  • 2014
  • 2015
  • 2016
  • 2017
  • 2018
  • 2019
  • 2020
  • 2021
Payroll Plus MX

Certifications

  • SOC I Type II
  • Certificate of Audit
  • ISAE 3402 SOC Type II

Contact us!

E-mail: contact@payrollplus.mx

Guadalajara: +52 (33) 3678-5530

Mexico: +52 (55) 5531-1449

Monterrey: +52 (81) 4624-0145

León: +52 (477) 1521-730

Copyright © 2023 | Privacy Policy
We use Cookies - By using this site or closing this you agree to our Cookies policy.