Minimum wage increase and reduction of the working day in Mexico 2026: implications for the business sector.

Increase to the minimum wage.

On December 3, 2025, the Board of Representatives of the National Minimum Wage Commission (CONASAMI) determined that, starting January 1, 2026, the general minimum wage will have a significant increase, going from $278.80 to $315.04 pesos per day, while in the Northern Border Free Zone it will increase from $419.88 to $440.87 pesos per day. 

This adjustment not only directly impacts company payroll, but also multiple concepts related to salary, such as employer-employee contributions, contributions to IMSS and INFONAVIT, calculation of labor benefits, severance payments, settlements and internal salary scales.

It also requires companies to ensure that no worker receives an income lower than the new legal minimum, regardless of the form of contract.

For employers, the minimum wage increase necessitates a complete review of salary structures, as internal distortions often arise when base salaries approach or equal those of higher hierarchical levels. A timely update helps prevent labor disputes, individual or collective claims, and findings during labor authority inspections.

Reduction of working hours.

On December 3, 2025, two initiatives with draft decrees were presented to the Senate: one proposes to reform and add provisions of article 123, section A, of the Political Constitution, and the second proposes to reform and add provisions of the Federal Labor Law.

Constitutional reform regarding working hours.

The proposed constitutional reform aims to establish, as a general rule, a maximum workweek of 40 hours, guaranteeing that for every six days worked, employees have at least one day of rest with full pay. This change seeks to progressively redefine the organization of working time in Mexico.

Regarding overtime, the proposal elevates the limits and methods of payment to constitutional status. It establishes that overtime may be performed for up to 12 hours per week, distributed in a maximum of 4 hours per day and up to 4 days per week, and must be paid at 100% of the regular salary. When this limit is exceeded, the additional time must be paid at 200% more, and the proposal expressly prohibits minors under 18 years of age from working overtime.

To facilitate the transition, the reform contemplates a gradual reduction of the working day between 2026 and 2030, starting with 48 hours per week in 2026 and decreasing by two hours per year until reaching 40 hours in 2030. Once the reform is published, the Congress of the Union will have 90 days to adapt the secondary legislation, mainly the Federal Labor Law.

The entry into force of this constitutional reform requires the approval of two-thirds of the Congress of the Union, the ratification of the majority of the state legislatures and its publication in the Official Gazette of the Federation.

Reform to the Federal Labor Law.

In parallel, the proposed reform to the Federal Labor Law seeks to harmonize secondary legislation with the new work schedule model. Among the most significant changes are a clarification of the concept of employer, a redefinition of the workday as the time during which an employee provides subordinate services, and the establishment of a maximum duration of 40 hours per week, while maintaining the daily schedule of up to eight hours without modifying the day, night, and mixed shift patterns.

Regarding overtime, the law stipulates that it may only be performed in exceptional circumstances and must be paid at 100% above the regular rate, with a maximum limit of 12 hours per week, distributed under specific conditions. When this limit is exceeded, the additional time must be paid at 200% above the regular rate, provided that the sum of the regular and overtime hours does not exceed 12 hours per day.

A significant change for businesses is the introduction of the employer's obligation to maintain an electronic record of working hours, retain this information, and make it available to the authorities upon request. This measure strengthens labor verification and control powers.

The reform to the Federal Labor Law is scheduled to take effect on May 1, 2026, although some aspects, such as the maximum duration of overtime work, will be implemented gradually until 2030. The requirement for electronic timekeeping will take effect on January 1, 2027. For it to be valid, the initiative requires approval by a simple majority in Congress, its promulgation by the Federal Executive, and its publication in the Official Gazette of the Federation.

Recommendations and administrative actions for a legal and orderly transition.

Given the increase in the minimum wage and the eventual reduction of the working day, it is essential that companies adopt a preventive strategy, focused not only on formal compliance, but also on the proper management of their labor relations.

It is advisable to conduct a comprehensive review of individual and collective employment contracts to ensure that the agreed-upon conditions are aligned with the new salary and working hours regulations, and to update clauses related to schedules, overtime, breaks, and attendance control mechanisms. Proper drafting significantly reduces the risk of misinterpretation and future conflicts.

Likewise, companies must update their internal policies, salary scales, work regulations and timekeeping systems, especially in light of the future obligation to keep electronic records of working time, which will be a key element in inspections and procedures before the authority.

From an administrative and compliance perspective, it is advisable to conduct internal labor audits to identify areas of risk, payroll inconsistencies, operational practices that are not aligned with the law, and opportunities for improvement in human capital management. These audits facilitate informed decision-making and minimize legal and financial risks.

Finally, proper labor and corporate advice allows companies to adequately manage their relationship with authorities such as the Ministry of Labor and Social Welfare, attend to inspections, requirements or administrative procedures, and support the organization in the implementation of regulatory changes without affecting its operation.

Anticipating these adjustments not only guarantees legal compliance, but also strengthens the company's internal stability and its ability to adapt to a constantly changing work environment.