Specialized services outsourcing and Staffing in
MEXICO
In May 24, the Mexican Ministry of Labor and Social Welfare issued general provisions on outsourcing.
The agreement issued by the ministry contains the general provisions for the registration of legal entities that provide specialized services or perform specialized works and that for this purpose, provide or make available their own workers for the benefit of another to perform the services or perform the specialized works.
Gracemark Mexico is part of a group of staffing and outsourcing companies that are already registered with the Mexican government to provide specialized services and works. Gracemark is offering managed services solutions where we can help you make sure all your outsourced services, staffing, and payroll solutions operate in full compliance with the new laws while making sure your operations are successful and continue operating seamlessly during these transitions.
The problem:
Some ” Pagadoras ” used fiscal loopholes to reduce the payment of taxes and benefits to employees which was a practice that grew nationwide affecting the government and employees paid through this type of companies.
The solution:
The government of Mexico recently passed a Law requesting outsourcing companies to register as “specialized services providers”. The registration process requires companies to prove that they have paid all their taxes since the beginning of their operations including a letter of good standing from the Mexican revenue agency, the social security, and the state-run worker’s compensation agency.
THE FUTURE
Companies in Mexico that want to outsource some functional areas must do it through agencies registered as specialized service providers, furthermore, the new law limits the outsourcing of employees to support functions that are not directly related to the main objective of the service or product of the client.
LIMITATIONS
Companies will not be able to use outsourcing or staffing companies to manufacture or render their main services to the client but will be able to use staffing and specialized services for support services.
WHO IS AFFECTED
BY THIS LAW
The companies that have legal entities in Mexico that use payroll outsourcing should find new suppliers that have the registration or bring their previously subcontracted employees as full-time employees (insourcing). Naturally, the outsourcing companies that didn’t fulfill their tax obligations will not be able to register and will be unable to operate.
WHO IS NOT AFFECTED
BY THIS LAW
International companies without local legal entities.
Foreign companies that do not have a local entity and use local outsourcing, staffing, or global payroll services to outsource their activities or pay their contractors in Mexico will not be affected, however, should the company desire to open a local subsidiary their local outsourcing partners should be registered as a specialized service provider before the official opening date of their local subsidiary.
Managed
services
The Law only applies to companies that make available their own workers for the benefit of another to perform the specialized services or works. The changes don’t apply If the client hires another company to produce deliverables or services without supervising the employees and paying for the deliverables which should be clearly reflected in the agreement.
SOME OF OUR SOFT LANDING AND EXPANSION SOLUTION FOR LATAM
- Staffing in Latin America
- Payroll Latam / Employer of record
- Market intelligence studies
- Business Development Outsourcing
- Business Process Nearshoring
- Executive Search & Recruitment