Employment Agreement Adjustments in Mexico

PTO, notice periods, bonuses, and more.

Updated on December 20th, 2022

Can we adjust paid time off (PTO)?

Yes, PTO can be adjusted as long as the statutory amount is received. Please note that it is not possible to reduce the PTO once it has been granted to the supported employee. After that, we can only increase the amount of PTO.

Can we adjust working hours?

Forty hours is the standard for a five-day workweek. If you want to extend this, the maximum working hours are 48 hours per week (six-day workweek).

Can we remove the notice period?

No. Our Master Service Agreement (MSA) states that we require at least 30 days to initiate a termination. 

Can we remove or increase the probationary period?

Yes. Probationary periods are permitted but not required in Mexico, so they may be removed. A probationary period is feasible under indefinite or fixed-term employment agreements for more than 180 days of duration. The duration of the probationary period varies depending on the type of activity. With Velocity Global, the standard trial period is 30 days (this has to be confirmed with a specific position or activity).

Can we add commissions, bonuses, or ad hoc payroll items?

Bonuses and commissions for the supported employee may be added through the Variable Compensation Agreement template.

Please be advised that if the supported employee is not provided clear and explicit metrics into how a discretionary bonus is earned, whether sales-related or not, they may have a strong argument with the Mexican labor regulator to obtain the full amount of the outlined bonus. The supported employee may argue that they were never told how to earn the discretionary bonus and that it was promised as part of their salary.

For that reason, Velocity Global can include a discretionary bonus amount or percentage in the employment agreement, but we require written confirmation that you knowingly and willingly accept this risk and will pay the full amount if the supported employee successfully claims it.

How can we offer equity or stocks to our supported employees?

In Mexico, we offer you the option of issuing equity as either “nonemployee” or “employee” grants. We do not facilitate withholding and payroll reporting unless the award is cash settled. 

How can we offer a probationary signing or a direct agreement between our supported employee and us?

We require you to directly issue the grant notice (i.e., side agreement) to your supported employee. This side agreement should not include any language that indicates a direct employer or employee relationship between you and your supported employee.