On September 27, 2022, the senators that make up the Labor and Social Welfare Commission unanimously approved the Opinion to amend Articles 76 and 78 of the Federal Labor Law, presented by the United Commissions of Labor and Social Welfare and Legislative Studies, regarding vacations. Before its official approval, this opinion must be subject to review by the Chamber of Deputies.

The Opinion takes up the initiatives proposed by senators of different parliamentary groups. Although some initiatives contemplated vacation schemes with a greater number of days, and some even proposed a reduction of the working day, the approved Opinion only extends the right to paid vacations, to be as follows:

YEARS WORKED	NUMBER OF DAYS OFF (PTO)
1	12
2	14
3	16
4	18
5	20
6 a 10	22
11 a 15	24
16 a 20	26

The reform establishes that workers must continuously enjoy at least 12 days of vacation. This reform is justified on the basis of our country's lag in terms of holidays, since, when compared to other countries with a similar level of development to ours, Mexico is one of the countries with the lowest level of vacation periods around the world. For example, in Brazil and Panama, the legal standard is 30 days of vacation as of the first year, while the average in the region is almost 15 days.

The proposed Opinion points out that the World Health Organisation (WHO) estimates that in Mexico 75% of the workforce suffers from work-related stress, which puts us in a global first place, above the world's leading economies, such as China (73%) or the United States (59%). In this regard, it should be noted that specialists in the field have pointed out that short holiday periods have an impact on workers' stress levels, as well as being related to other ailments, such as chronic exhaustion (burnout).

Although everything seems to indicate that this reform will be approved in the short term, there is no certain date for it to be published in the Official Gazette, given the current legislative process. Employers' chambers have requested that the implementation of the reform be gradual so as not to harm small and medium-sized enterprises and to allow them to make the necessary projections and adjustments to comply with the new standard.

This change will have an operational and economic impact in companies, and will ultimately benefit them by increased employee satisfaction.

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As a result of the May 2019 Labour Law Reform, the new model was implemented in each of the country's states in stages, facing delays mainly due to budgetary problems and the challenges of coordination between the state and federal levels. On 3 October 2022, however, the third and final stage of its implementation was completed. As of that date, the authorities that will attend new labour disputes in all federal entities of the Republic will be the Conciliation and Registration Centres and the Labour Courts.

With this implementation, the Conciliation and Arbitration Boards have ceased to see claims and any other requests related to new procedures, including out-of-court settlements, being in charge only of the processing and resolution of lawsuits that were previously filed before this authority.

As we have previously reported, the new procedure implies a mandatory pre-judicial conciliation before the Conciliation Centres as a condition for filing a lawsuit before the Labour Courts, except for those alleging discrimination or pregnancy, among others exceptions provided in the Law. The appearance of the employer is also compulsory, and the authority can impose fines in case of failure to appear, so we envisage that conciliation will play an important role in dispute resolution.

Contrary to the procedure followed before the Conciliation and Arbitration Boards, the stages of the new procedure are in writing, with the exception of the preliminary and trial hearings.

The procedure before the Labour Courts implies new challenges for the defence of the cases, as the new regulations impact procedural terms and the burden of proof for the parties. This will also be reflected in new forms of administration of the employment relationship, from its inception to its termination.

Notwithstanding the challenges that a transformation of this scale implies, this change has generated the expectation of having greater legal certainty and shorter times in the resolution of conflicts, which, in the experience of the first two stages, have been resolved within the procedural terms established by law. In the states where the new procedure was previously initiated, disputes have been resolved on average within a timespan of 6.1 months.

With this third stage, Mexico is closer to fulfilling its commitments under T-MEC, the free trade agreement between Canada, Mexico, and the United States. What remains pending in this regard is the deadline for the legitimisation of collective bargaining agreements, which, like the implementation of the new labour justice model, has faced operational challenges.

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