Mexico’s labor legislative agenda continues to move forward at a significant pace. During September 2026, 56 labor reform bills were introduced before Congress, bringing the current LXVI Legislature of the Congress of the Union to more than 550 labor-related proposals to date. The main topics addressed during the month include the regulation of overtime, the implementation of the gradual reduction of the workweek, the effective use of vacation days, pay transparency, and the impact of artificial intelligence on employment.
It is important to note that the proposals described below are legislative initiatives (the “Initiatives”) and do not form part of the current legislation or, as of today, impose any obligations on employers in Mexico. As part of the legislative process, these proposals may be substantially amended or may ultimately not be approved.
Nevertheless, given the volume of Initiatives and the topics they address, we recommend for companies to monitor their development. If certain Initiatives are approved, they could result in relevant changes to human resources practices, compensation structures, working hours and vacation administration, as well as labor compliance mechanisms.
Below is a summary of the main Initiatives introduced during September 2026:
Deputy Theodoros Kalionchiz de la Fuente proposed amendments to the Federal Labor Law (the “FLL”) to establish that overtime may only be used to address temporary and exceptional needs, preventing overtime from becoming a regular or permanent practice. The proposal would also require employers to maintain documentation supporting the exceptional nature of extended working hours, which could be subject to review by labor authorities.
In addition, the Initiative proposes amendments to the Income Tax Law to provide, subject to certain requirements and limits, favorable tax treatment for overtime payments.
If approved, companies would need to strengthen the documentation and justification supporting overtime, particularly in operations where overtime is recurrent. Companies should also consider reviewing their internal overtime authorization, recording and monitoring mechanisms.
Senator Francisco Daniel Barreda Pavón proposed amendments to the FLL to require the Ministry of Labor and Social Welfare (“STPS” per its acronym in Spanish) to publish quarterly information regarding the actual duration of working hours and the effects of the gradual reduction of the workweek. Such information could incorporate data from INEGI, IMSS and other government authorities, including indicators relating to formal and informal employment, productivity, hours actually worked and wages.
The Initiative would not, by itself, impose new direct obligations on companies; however, it could contribute to increased monitoring and scrutiny of working hours and actual time worked during the implementation of the gradual reduction of the workweek.
Deputy Armando Corona Arvizu proposed amendments to the FLL to expressly require employers to ensure that employees effectively take all vacation days to which they are entitled within the applicable statutory period.
The proposal would preserve the possibility of taking vacation in one or more periods; however, where vacation days remain unused and 30 calendar days or less remain before the applicable statutory period expires, the employer would be required to notify the employee of the outstanding days and establish the necessary dates to ensure that such vacation is taken. Ordinary business needs, failure to schedule vacation, or an employer’s refusal could not prevent employees from taking their vacation.
If approved, companies would need to strengthen their vacation planning, scheduling and monitoring mechanisms, as well as implement controls to identify and prevent the accumulation of unused vacation balances.
Deputy Lucero Higareda Segura proposed amendments to the FLL to establish that a company or workplace may replace no more than 40% of its workforce through artificial intelligence. The proposal seeks to permit the automation and adoption of new technologies while establishing a limit on the displacement of employees through the use of artificial intelligence.
This reform could limit certain automation and workforce restructuring processes and create additional documentation requirements regarding the impact of artificial intelligence tools on a company’s workforce.
Deputy Ariana del Rocío Rejón Lara proposed amendments to the FLL to: (i) require salary ranges to be disclosed in job postings; (ii) prohibit employers from requesting candidates’ compensation history; (iii) establish objective, accessible and neutral criteria for determining compensation and promotions; (iv) allow employees to obtain information regarding the compensation applicable to their position and the average compensation of employees performing similar duties, with gender-disaggregated information and appropriate personal data protections; and (v) require employers to correct, within a maximum period of six months, any unjustified pay difference exceeding 5%, as well as prepare an annual gender pay gap assessment for the STPS in companies with more than 100 employees.
If approved, this Initiative could have a significant impact on human resources practices, particularly with respect to recruitment, compensation structures, job evaluations, promotions and the documentation supporting compensation decisions. Companies would need to assess whether they have sufficiently objective and well-documented criteria to support their compensation structures.
In addition to the Initiatives described above, there are two labor reform initiatives that have reached a more advanced stage of the legislative process and that, given their potential impact, we consider particularly relevant.
a. The proposed reform on digital disconnection seeks to expressly recognize in the FLL the right of employees to refrain from engaging in communications with their workplace outside of their working hours, including during non-working hours, vacations, leaves and licenses. Unlike the current framework, which expressly recognizes this right for employees working under telework arrangements, the proposed reform would extend the right to all employees.
The Chamber of Deputies approved the reform on March 3, 2026, and the bill was subsequently referred to the Senate, where it remains pending consideration and a vote.
b. The proposed reform regarding equal-pay inspections has also reached a significant stage of the legislative process and seeks to strengthen labor authorities’ inspection powers with respect to pay equity. The bill would authorize the STPS and the labor authorities of the states to conduct inspections to verify compliance with the principle of equal pay between women and men.
The Senate approved the bill in November 2025, and it was subsequently sent to the Chamber of Deputies. According to legislative information reported in September 2026, the reform is currently pending only a vote before the Plenary of the Chamber of Deputies to complete the legislative process.
We recommend monitoring the progress of these Initiatives and preliminarily assessing their potential operational impact.
Our team will continue to monitor these developments.
Legal Notice: This Client Alert is for informational purposes only and does not constitute legal advice or a formal opinion on any specific matter. The information contained herein reflects a general analysis prepared by our attorneys based on information available at the time of publication. Any reproduction, citation, or reference to this content must be expressly attributed to Mijares and should not be construed as a public statement or comment made by the firm to the media.
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