Reform to reduce Working Hours

Dear Clients,

We would like to inform you that Congress has approved the reform to the Federal Labor Law regarding the reduction of the workweek, which entails relevant changes in the organization of working time in Mexico.

Below is an executive summary of the most relevant aspects:

1. Workweek Reduction
A maximum workweek of 40 hours is established.

2. Gradual Implementation
The reduction will be implemented progressively according to the following schedule:

• 2026: 48 hours (no immediate operational change)
• 2027: 46 hours
• 2028: 44 hours
• 2029: 42 hours
• 2030: 40 hours

3. Flexibility in Work Schedule Distribution
The work schedule may be distributed by agreement between employer and employee, allowing for more flexible work organization schemes.

4. Overtime Adjustments

• Limit: up to 12 hours per week
• Maximum of 4 hours per day
• Payment in accordance with the legal framework (double and triple rate)

5. Electronic Time Tracking (New Obligation)
Employers must implement an electronic worktime tracking system, which must:

• Record start and end times
• Be retained and made available to the authorities
• Serve as evidence in case of disputes

6. Penalties
Fines are established for non-compliance with the time tracking obligation, ranging from 250 to 5,000 UMAs.

7. No Salary Impact
The reduction of the workweek may not result in any decrease in salaries or benefits.

8. Entry into Force
The decree provides for its entry into force on May 1, 2026, without prejudice to the gradual implementation of the workweek reduction.