Key Changes and Implications for Workers and Platforms
A new labor reform targeting app delivery drivers and ride-hailing drivers has come into effect on June 22, introducing specific regulations under the Federal Labor Law (LFT). The reform ensures full access to social security for those earning equal to or more than a minimum wage, classifying others as independent workers but still providing accident protection.
Marath Bolaños Highlights the Significance
Marath Bolaños, Secretary of Labor and Social Security, expressed pride during a press conference at the National Palace, stating that this regulation is “a pioneering effort globally” demonstrating that technological innovation and labor justice can coexist within Mexican humanism.
Key Benefits and Obligations
- Social Security and Labor Rights: The reform guarantees social security and labor rights for drivers who work more than 288 effective hours annually, also granting them a share of service utilities.
- Flexibility in Work: While recognizing a subordinate relationship during working hours, the reform allows drivers the freedom to connect and disconnect at their discretion, preserving flexibility in time, moment, and app selection for service provision.
- Clear Regulations to Prevent Abusive Practices: The reform mandates companies to pay service provision within a week, maintain a record of working hours and waiting times, ensure data security, establish mechanisms for addressing workplace harassment and sexual harassment, among other points.
Formalization through Labor Contracts
The reform requires digital platforms to enter formal labor contracts with drivers, distinct from service terms and conditions. These contracts must be registered with the Federal Center for Labor Mediation and Registration (CFCRL).
Algorithmic Management Policy
Digital platforms must now have an algorithmic management policy that drivers understand, containing three elements:
- Algorithm Criteria: Platforms must explain their algorithms’ elements affecting labor relations, including task allocation rules, performance evaluation criteria, and consequences of customer ratings.
- Impact on Employment: Platforms must inform how algorithmic decisions influence future job assignments, incentive opportunities, and penalty applications.
- Incentives and Penalties: Platforms must detail reward and penalty systems, explaining their impact on work intensity, quality, frequency, and pace.
Next Steps
Following the reform’s enactment, the Secretariat of Labor and Social Security (STPS) has five days to publish general provisions for calculating net income, crucial as full social security is linked to earnings.
Additionally, the technical council of the Mexican Social Security Institute (IMSS) has five days to issue general rules for worker affiliation with app-based services, enabling a mandatory pilot program from July 1 to December of this year. This exercise will evaluate and propose legal adjustments to align the social security regime with the realities of these activities.
