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Mar 25, 2021 in Compare and Contrast

Compare and Contrast: Labor and Employment Laws in the United States and Mexico

During the past thirty years, the field of Human Resource (HR) has undergone dramatic changes. Beginning in the 1980s, many businesses started shifting their focuses from a domestic to multinational level because of friendly tariffs and favorable regulations. With the advent of new technologies, the speed with which business operations are conducted have increased radically. With these opportunities, organizations have started to realize that more competitive advantages would emerge if human resources were utilized wisely through stricter adherence to labor and employment laws (Snell & Bohlander, 2010). Based on these trends, the concept of labor and employment laws in the sphere has become essential for adoption in many businesses particularly in the US and Mexico.

Labor and Employment Laws in the United States and Mexico

When the North American Free Trade Agreement was signed in 1992, many companies in North America desired to move their operations from Canada and the United States to Mexico. Their aims were to enjoy the availability of cheap labor and low costs of production (Musalem, Vittas, & DemirgOu-Kunt, 1993). These migrations have resulted in the growth of maquiladora industries, which are primarily located along the border between the US and Mexico. With this situation prevailing to date, many employers are worried about the differences in American and Mexican labor and employment laws. They fear that the dissimilarities in statutes may lead to additional financial obligations with regard to the Mexican workers. To explain this situation, the paper will derive from the general model of the international human resource management to present a comparative analysis of labor and employment laws between the United States and Mexico. The presentation will be based on various aspects such as the legal framework, categories of employees, the statutory law, and the length of employment among others.

Comparing Labor and Employment Laws in the United States and Mexico

The United States' and Mexican labor and employment laws can be compared to some extent.

Categories of Employees

Employees versus independent contractors. In both, the United States' and Mexico, labor and employment laws provide a clear distinction between employment contracts and other forms of contracts such as contract for services. In Mexico, all employment contracts are required to invoke all the provisions stipulated by the Federal Labor Law (FFL). Various factors are considered in differentiating employment contracts from commercial and civil ones (Celia, 2011). Similarly, there are different procedures in the United States used to distinguish between employees and independent contractors.

Supervisory employees. In both the United States and Mexico, there are two main classifications of staff members namely supervisory and other workers. The labor laws in both countries prohibit supervisory employees from participating in union activities. However, their basic salaries and benefits are higher than those of other workers.

Liability Risk Exposures

Work disabilities and injuries. In both countries, employers are required to take responsibility if a worker is hurt in the course of employment. All injured staff members ought to be compensated fairly for all traumas or disabilities they suffer from.

Equal rights at work. In both the states, the labor and employment laws shield employees from discrimination based on their gender, ethnic group, age, religion, or political views. Employers may be liable if workers� rights are violated in the course of their employment.

Trade Unions

In countries under analysis, trade unions are acknowledged in the labor and employment laws. Up to 25 percent of all Mexico workers and approximately 12 percent of the American ones are represented in trade unions (Snell & Bohlander, 2010).

Contrasting Labor and Employment Laws in the United States and Mexico

The Mexican and the United States labor and employment laws can be contrasted on different grounds.

The Legal Structure

The labor and employment laws of the countries under consideration are different based on the structures they are founded on. In Mexico, the legal system is based on the civil law tradition, which was established using Romano-Germanic principles (Celia, 2011). In contrast, the United States legal system is based on the doctrine of stare decisis. The implication here is that judges in the US are free to rely on the decisions of preceding cases to decide the outcomes of present judicial decisions (United States Department of Labor, 2015). This creates differences in the way labor and employment matters are handled legally.

The Statutory Law

The sources of labor and employment laws in the countries are dissimilar. In Mexico, the ultimate foundation of labor laws is the federal system while in the United States, the labor laws are based on the state law system. In the USA, labor laws are formulated and applied differently in each state (United States Department of Labor, 2015).

The Length of the Employment Term

In the United States, the common law rules consider employment relationships to be voluntary or at-will. The implication here is that they can be terminated at any time for any reason provided that no legal provisions are breached (United States Department of Labor, 2015). In contrast, the Mexican labor laws assume that employment contracts are indefinite and can last as long as the parties agree (Celia, 2011).

Minimum Wages and Benefits

The minimum wages payable to workers have for a long time been higher in the United States than in Mexico. According to US State Department, the minimum wages and benefits in the US should be 10 percent of the total production costs (United States Department of Labor, 2015). On the contrary, according to the Mexican Federal Labor Law, FFL, they should account for 25 percent of the total production costs (Celia, 2011).

Conclusion

When the United States' and Mexican labor and employment laws are reviewed, they show a variety of similarities as well as differences. Among the common points are the aspects such as equal work rights, categories of employees, trade unions, and liability of risk. The differences are based on aspects such as the minimum pay and benefits, statutory law, legal framework, and the length of the employment term. This shows the extent of disparities between the labor and employment laws in the United States and Mexico.

References

Celia, J. (2011). What multi-national employers need to know about Mexican labor and employment law.

Musalem, A., Vittas, D., & Demirguc-Kunt, A. (1993). North American free trade agreement: Issues on trade in financial services for Mexico. Washington, DC: Financial Sector Development Department, The World Bank.

Snell, S., & Bohlander, G. W. (2010). Principles of human resource management. Boston, MA: South-Western Cengage Learning.

United States Department of Labor. (2015). Summary of the major laws of the Department of Labor.

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