Background on the Issue
The Coparmex, led by Juan José Sierra, has raised concerns that failing to incorporate work reduction mechanisms through special regimes and flexibility measures by sector and industry could lead to increased informality and higher prices for consumers. The organization emphasizes the importance of implementing flexible work arrangements to avoid adverse effects on businesses and consumers.
Chile’s Reform as a Case Study
Coparmex referenced Chile’s 2023 reform, which gradually reduced the workweek from 45 to 40 hours over five years. This reform allowed for flexible models and formulas in work schedules, demonstrating that successful transitions are accompanied by productivity policies, training, and tailored adaptation schemes.
The International Labour Organization’s (ILO) Recommendation 116 outlines fundamental principles, including a gradual reduction without affecting income, support for vulnerable sectors, and balancing well-being with economic sustainability.
Coparmex’s Proposed Solutions
Coparmex suggests that Mexico should create its own path, acknowledging the country’s productive diversity and designing a flexible model that safeguards formal employment. They propose a phased implementation strategy based on evidence and gradualism, prioritizing sectors with favorable conditions and conducting periodic impact assessments.
Additionally, Coparmex recommends establishing special regimes for continuous-operation sectors like mining, manufacturing, private security, and logistics. These sectors require extended work hours structurally and necessitate analysis of overtime arrangements to avoid distortions harming workers and employers.
To encourage a shift towards reduced work hours without affecting workers’ net income or overburdening companies, Coparmex proposes two complementary measures: 100% deductibility of labor benefits and a review of the ISR (Income Tax) and employment subsidy schemes.
Potential Impact on Micro, Small, and Medium Enterprises (Mipymes)
Coparmex highlighted that failing to implement flexibility mechanisms would particularly affect Mipymes, where over 7.3 million people work more than 40 hours per week. Any transition should start with these structural realities and avoid leading to informality, layoffs, or deterioration of labor conditions.
Key Questions and Answers
- What is Coparmex’s main concern? Coparmex fears that without implementing flexibility mechanisms, there could be increased informality and higher prices for consumers.
- What is the example of a successful work reduction reform? Chile’s 2023 reform gradually reduced the workweek from 45 to 40 hours over five years, allowing for flexible models and formulas in work schedules.
- What are Coparmex’s proposed solutions for implementing work reduction? Coparmex suggests phased implementation based on evidence and gradualism, prioritizing favorable sectors and conducting periodic impact assessments. They also recommend special regimes for continuous-operation sectors and analyzing overtime arrangements.
- How would Coparmex’s proposed measures benefit workers and businesses? These measures aim to strengthen formal employment, protect workers’ purchasing power, and ensure financial sustainability for productive units.
- Which groups would be particularly affected by not implementing flexibility mechanisms? Mipymes, where over 7.3 million people work more than 40 hours per week, would be significantly impacted.
