On June 17, the new General Regulations for Work Inspection and Application of Sanctions (“Regulations”) were published in the Federal Official Gazette (“DOF”, for its acronym in Spanish), which will become effective three months after their publication.

The Regulations govern all the Mexican territory and have as a purpose to establish the procedures to promote and supervise compliance with the labor laws and the elements to consider for the quantification of fines for infringements to the same at workplaces. Their application corresponds both to the Secretariat of Labor and Social Welfare (“STPS”, for its acronym in Spanish) and to the labor authorities of the federative entities.

Inspection to the Workplaces

The new Regulations classify the inspection visits as follows:

  • Consultancy and Technical Assistance Inspections. They have the purpose to promote among workers and employers the compliance with labor regulations, dignified and decent work, labor inclusion, promoting the creation of formal jobs, increase of training and productivity, promoting the prevention of occupational hazards, as well as protecting labor human rights.

These inspections are also applicable at workplaces employing fifteen or less workers and when the company as a whole does not have any other establishments, work centers or branches than the place visited.

  • Data Verification Inspections. The purpose of said inspections is to obtain information which allows keeping the workplaces lists updated.
  • Inspections for the Determination of Administrative Jurisdiction. Their purpose is to establish whether a workplace must be subject to the surveillance of the federal or local labor authorities.
  • Surveillance Inspections. Their purpose is to verify the information provided by the employers or their representatives through “alternative inspection mechanisms” and corroborate the truthfulness of the facts reported by labor inspectors in the documents, reports or records produced as a result of the inspections.

“Alternative inspection mechanisms” shall be understood as the schemes that the labor authorities make available to the employers so that they may report or evidence compliance with labor regulations, such as operation notices, questionnaires, evaluations or similar requirements.

  • Initial Ordinary Inspections. Those performed for the first time to the workplaces, or due to the expansion or modification of the same.
  • Periodical Ordinary Inspections. Those performed every twelve months, term that may be extended or reduced in accordance with the evaluation of the results obtained derived from previous inspections, taking into consideration the industrial field, the nature of the activities that they perform, their risk degree, number of workers and geographical location.
  • Ordinary Verification Inspections. They are performed when it is required to verify compliance with the measures ordered by the labor authorities in matters of Safety and Health at Work.
  • Extraordinary Inspections. They may be performed at any time, even during nonworking days and hours and they are admissible in the following cases:
    • When there is knowledge that there is an “imminent danger or risk”, or else, when complaints or accusations of possible infringements to the labor laws are received.

“Imminent danger or risk” shall be understood as the one having a high probability of materializing in an immediate future and supposes a damage for safety and health or the loss of the lives of the workers, or causing serious damages to the workplace, which is produced by the direct correlation of the high hazard of a physical, chemical, biological agent or physical condition, for exposure by the workers.

  • When labor authorities learn about probable infringements to the labor regulations.
  • Upon reviewing the documentation submitted for any purpose, the authorities may become aware of possible irregularities imputable to the employer or that it incurred in falsehood.
  • When the authorities become aware of accidents occurred at the workplaces or of the death of workers resulting from an occupational hazard.
  • When the authorities may detect inspection reports or documents lacking the requirements established in the applicable legal provisions, or from those inferring elements to assume that the labor inspector behaved in an irregular manner.
  • The authorities verify that the workplaces have suspended activities due to a health alert issued by the competent authorities.
  • The authorities require verifying that the brief of objections to the annual income-tax return was filed by most of the workers of the company.

Inspection Procedure

Ordinary inspections must be practiced previous citation to be delivered at the workplace at least twenty four hours before the day that they will be performed, mentioning name of the employer, domicile, day and time that the proceeding will be conducted, the type of inspection as well as the number and date of the corresponding inspection order, accompanying a list of documents that must be presented by the employer, the aspects to review and the legal provisions on which they are based.

Extraordinary inspections will be performed without the need of any previous citation.

At the beginning of the inspections, either ordinary or extraordinary, the labor inspector must deliver to the employer or to the person in charge, the original of the respective written order, with autograph signature of the public officer empowered thereto, as well as a guide containing the main rights and obligations of the employer to be inspected.

The inspector must display a valid credential with photograph, issued by the competent authorities, entitling him to perform such duties, which must contain the caption “this credential does not authorize its holder to make any inspection whatsoever without the corresponding order”.

The employer may corroborate the authenticity of the labor inspector as well as the data contained in the inspection orders by telephone or Internet.

A report will be prepared from any inspection, with the participation of the employer or its representative, as well as of its workers, before two witnesses proposed by the employer, or else, designated by the inspector himself if the employer refuses to propose them.

During the inspection, the labor inspector will ask positively framed questions to the workers and to the employer or its representatives, which will refer only to the subject-matter of the inspection, being empowered to separate the parties in order to prevent the possible influence on the answers of the responding parties. The question to be asked and the answers to be obtained from the interviews made will be registered in a special section of the report.

To prevent reprisals against the workers for the comments that they might make, the labor inspector must ask the same if they authorize that their personal information is noted down in the respective section, which will be kept under reserve until the labor authorities make the evaluation and rating of the inspection certificate.

Before concluding the preparation of the corresponding report, the labor inspector will allow that the persons having participated in the proceeding review the report, so that they may make the observations or offer the evidence that may be in their legal interest.

Likewise, the authorities must inform the employer or its representative about the right that it has to make observations and offer evidence in relation to the facts contained in the same, or make use of said right in writing, within the five-day term following the date that the respective report has been prepared.

The labor inspector must deliver copy of the report to the employer or its representative, as well as to the workers, and as the case may be, to the safety and health commission of the workplace.

The labor inspector, in all the visits that s/he makes, will grant the employers terms and deadlines to correct the identified deficiencies and noncompliance, so that they may make the modifications necessary and, as the case may be, to present the documentation evidencing compliance with their obligations.

The term may be from thirty to ninety working days, except in the case of imminent danger or risk, and must be established taking into consideration the industrial field, economic type and scale, degree of risk, number of workers, the risk represented for the workers and the difficulty to remedy them.

The terms granted may be extended, only once, up to a term equal to the one originally granted, provided that the life, safety and health of the workers is not being put in risk, and there is a petition by means of a free brief by the interested party before the expiration of the term granted.

In case that the noncompliance of the ordered measures is determined, or else, compliance with the labor regulations within the terms granted is not documentarily evidenced, the filing of the penalizing administrative proceeding will be requested.

Precautionary Measures

If during the inspection, the existence of “imminent danger or risk” is determined, the labor inspector will immediately order the corrective or preventive measures in matters of safety and health at work in order to protect the life, the physical integrity or the health of the workers. Said measures may consist of:

  • Total or partial suspension of the activities of the Workplace.
  • Restriction of access of the workers to a part or to the entire Workplace.

In case of coal mines and mining development in all their stages, the mining authorities will be informed so that they proceed to the suspension of mining works and operations, being entitled to request the assistance of the police force.

It should be mentioned that the restricted access or the limited number of operations must be previously authorized by the General Bureau of Federal Labor Inspection.

When the restricted access or the limited number of operations has been declared, the labor inspector must make a detailed report in writing within the twenty four hours following said determination, which will be delivered to the employer and to the STPS of to the corresponding Federal Labor Delegation, which must contain, at least, the following:

  1. Place and date of preparation;
  2. Public officer to whom it is addressed;
  3. Legal grounds;
  4. Type, date and number of Inspection;
  5. Corporate, company or firm name and address of the workplace;
  6. Grounds for restricted access or limited number of operations;
  7. Official communication number and description of the request made from the General Bureau of Federal Labor Inspection;
  8. Official communication number and description of the reply issued by the General Bureau of Federal Labor Inspection;
  9. Safety measures ordered by the labor inspector, and
  10. Name and signature of the labor inspector.

The Federal Labor Delegation or the General Bureau of Federal Labor Inspection, exercising the power to assume jurisdiction, will perform the analysis of the report submitted by the inspector within the twenty four hours following its reception or as the case may be, of the evidence or statements submitted by the individuals.

Once having concluded the analysis of the report and, as the case may be, of the evidence or statements submitted within the seventy two-hour term computed from the closing of the report, the Federal Labor Delegate, previous consultation and opinion of the General Bureau of Federal Labor Inspection, will determine if the restricted access or the limited number of operations is concluded in the risk areas detected, or else, declares the continuation of these actions, until the safety measures that were ordered are complied with. The above, notwithstanding that the General Bureau of Federal Labor Inspection decides to exercise the power to assume jurisdiction in order to issue the resolution mentioned above.

Against the resolution determining to maintain or conclude the restricted access or limited number of operations, the motion for review set forth by the Federal Law of Administrative Procedures may be filed by the affected employer.

When a resolution is made to continue or maintain the restricted access or limited number of operations, it will remain under the strictest responsibility of the employer or its representatives, to evidence compliance with the measures ordered by the labor inspector, as well as to inform about said compliance to the competent labor authorities by means of free brief, so that such authorities, previous performance of the proceedings that they may deem necessary and convenient, may resolve as applicable.

The restricted access or limited number of operations will be concluded by the labor inspector, once the employer or its representative evidence having complied with the measures ordered, by remedying the deficiencies that caused the same.

Penalizing Administrative Proceeding

Once having received the request of filing the penalizing administrative proceeding, the labor authorities will summon the employer so that it states whatever may be convenient in its legal interest, files defenses, exceptions and submits evidence. Said summon must contain:

  1. Place and date of its issuance;
  2. Corporate, company or firm name of the assumed infringer;
  3. Domicile of the workplace;
  4. Date of the inspection report;
  5. Legal grounds of the jurisdiction of the authority issuing the summons;
  6. Circumstances or facts evidenced in the report that are deemed infringing to the labor laws, as well as the legal provisions that are considered as infringed;
  7. Date, time and place to hold the hearing or as the case may be, the term granted to reply to the summons in writing, which may not be less than fifteen working days;
  8. In case that the assumed infringer had made observations or submitted evidence in relation to the facts contained in the inspection report, the specific arguments to evidence that same were analyzed and assessed must be established, and
  9. Warning that if the assumed infringer does not appear in the hearing or does not exercise its rights in the term granted, as the case may be, the default proceeding will be followed, considering as true the facts imputed to it.

The summoned employer may submit any means of evidence to annul the content of the inspection reports, provided that they are related to the specific facts, acts or omissions imputed to the summoned person. The proof by witnesses of the workers or their union representatives must be dismissed when the act or omission of the assumed infringer has affected the rights of the workers of the workplace.

Once the evidence has been received, the ruling for the admission, preparation or dismissal of such evidence will be issued, calling as the case may be, the corresponding hearing for evidence introduction. Once the summoned employer has been heard and the evidence previously admitted has been introduced, the ruling for the closing of the proceeding will be issued, sending in turn the records of the case in order to issue final resolution.

The resolutions to be issued by the Labor Authorities imposing sanctions for infringements to the labor laws will contain:

  1. Place and date of their issuance;
  2. Authorities issuing same;
  3. Corporate, company or firm name of the infringer;
  4. Domicile of the workplace;
  5. Federal Taxpayers’ Registry of the infringer, when contained in the records of the case;
  6. List of the court actions contained in the records of the case, including the evidence admitted and introduced;
  7. Legal provisions on which the jurisdiction of the authorities issuing same is based on, as well as the legal and factual grounds of the resolution;
  8. Ruling of the court;
  9. Warning for compliance with the regulations infringed;
  10. Mention of the right that the infringer has to file the corresponding means of defense, and
  11. Name and signature of the public officer issuing same.

The resolutions must be issued within the ten working days following the day that the instruction of the proceeding has been closed.

To quantify fines, the labor authorities will take into consideration:

  1. The intentional nature or not of the action or omission constituting the infringement. It will be assumed that the conducts performed by the employer are not intentional, unless that from the introduction of the inspections and from the evidence contained in the records of the case, omissions, facts, circumstances or evidence are detected that support that the noncompliance was voluntarily performed in order to evade its responsibilities, previous awareness of its obligations on the matter, causing a detriment to the rights of the workers.
  2. The seriousness of the infringement. Will be proportional to the damage that has been or may be caused with the employer’s conduct.
  3. The damages that might have been or may be caused. The damage will be the affectation directly or indirectly caused by the employer’s conduct, to the employees rendering their services at the workplaces being inspected.
  4. The economic capacity of the infringer. The elements that show in the best manner the economic situation of the employer will be taken into account, such as the information related to the amounts that the employer has granted to its workers for the concept of profit sharing; the net worth of the companies in the last balance; the sum of the corresponding payroll, or else, any other information through which, the status kept by the employer’s business is inferred.
  5. The recurrence by the infringer. Each of the subsequent infringements to the same legal principle, committed within the two years following the date of the report in which the preceding infringement was evidenced, will be considered as recurrence, provided that this had not been annulled.

In accordance with the Regulations, the imposition of fines per each of the affected workers, will proceed when as consequence of the noncompliance with the employer’s obligations, a personal, real, true and assessable in money damage is caused to the worker.