Background on the Issue
In Mexico, the federal government aims to provide full social security coverage (comprising five insurance schemes) to 300,000 platform workers. To achieve this goal, it is crucial to decrease the exclusion amounts used for calculating monthly income of drivers and delivery personnel, as outlined in the Analysis of Digital Platforms’ Labor Reform.
Current Situation and Progress
During a presentation, Ángel Pazos Romero, coordinator of the Fundación Friedrich Ebert in Mexico’s Sindical Dialogue Social, explained that during the first phase of a pilot program, 133,000 workers gained access to social security. The distribution was as follows: 60% for cars, 50% for motorcycles, and 15% for non-motorized vehicles.
To qualify for social security in this phase, after deducting taxes, commissions, tips, and the exclusion percentage, a worker’s monthly income had to be at least 20,910 pesos for cars, 16,728 pesos for motorcycles, and 9,840 pesos for non-motorized vehicles.
Upcoming Changes
Starting October, these exclusion amounts will be significantly reduced: 35% for cars (equivalent to a minimum income of 13,068 pesos), 30% for motorcycles (equivalent to a minimum income of 11,948 pesos), and 12% for non-motorized vehicles (equivalent to a minimum income of 9,504 pesos). These adjustments represent a decrease of 24% for cars, 20% for motorcycles, and 3% for non-motorized vehicles compared to the first phase.
Key Points on Accessing Social Security
Pazos Romero clarified that the monthly net minimum wage is calculated by subtracting taxes, platform commissions, tips, and the exclusion percentage from a worker’s monthly income. He emphasized that to obtain full social security, workers must prove they meet or exceed this net minimum monthly wage on a single platform.
Although the law can be improved, Pazos Romero noted that it has enabled over 133,000 workers to access social security. The exclusion percentages are expected to continue adjusting by 2026, with estimates ranging from 24-26% for cars, 18-20% for motorcycles, and 8-10% for non-motorized vehicles.
He also mentioned that the government is committed to ongoing dialogue with companies to reach agreements that benefit workers without affecting platform operations.
Benefits of the Labor Reform
Pazos Romero, who has been working on digital platform labor reform in Mexico for the past two years, highlighted that among the reform’s benefits are:
- Flexible labor conditions: Workers maintain their autonomy, deciding when, how long, and on which digital platforms to connect.
- Explained sanctions and disconnections: Must be justified by humans, not algorithms.
Workers have accident insurance applicable only during task execution; prohibition of application usage fees, eliminating charges platforms imposed on workers for using the app;
The existing tax regime remains unchanged, with the Individual Income Tax (ISR) rate for this group set at 3.5%; and the possibility of classification as either a subordinate or independent worker, allowing access to full labor rights (social security, pension, housing credits, childcare) if workers meet the established threshold or opt for voluntary insurance if they don’t.
Key Questions and Answers
- What is the goal of this labor reform? The Mexican government aims to provide full social security coverage to 300,000 platform workers.
- How will the reform be achieved? By reducing exclusion amounts used to calculate monthly income for drivers and delivery personnel.
- What are the current monthly income requirements for access to social security? For cars: 20,910 pesos; motorcycles: 16,728 pesos; non-motorized vehicles: 9,840 pesos.
- What changes are being implemented in October? Exclusion percentages will be reduced: cars (35%), motorcycles (30%), and non-motorized vehicles (12%).
- What are the benefits of this labor reform for platform workers? Flexible labor conditions, accident insurance during task execution, prohibition of application usage fees, explained sanctions and disconnections, and the possibility of classifying as subordinate or independent workers for access to full labor rights.
