Employee benefits in Mexico are set by the Ley Federal del Trabajo as a floor, and the floor is higher than most US employers expect. Every employee earns a year-end aguinaldo of at least 15 days' salary, a vacation entitlement that was doubled by the 2023 reform, a cash premium on top of vacation pay, social insurance through IMSS and a share of the employer's profits. None of it is optional and none of it can be waived by contract. For a company hiring in Mexico through an employer of record, these items are why the true monthly cost sits well above the agreed salary, and a quote that does not itemise them is understating the position.
Aguinaldo: the mandatory year-end bonus
The aguinaldo is a statutory year-end payment of at least 15 days' salary, and it must be paid before 20 December each year. An employee who worked less than the full year receives a proportional part rather than nothing, and PROFEDET, the federal labour defence office, states that a worker has one year to claim an unpaid aguinaldo. Because it is an entitlement and not a discretionary bonus, budgeting for Mexico means treating a thirteenth-month-style cost as part of base compensation from day one: roughly an extra half month of salary every December, more where an employer offers above the floor, which many established Mexican employers do.
Vacation and the 25% vacation premium
The vacaciones dignas reform, in force since 2023, rewrote Articles 76 and 78 of the Ley Federal del Trabajo. An employee now earns 12 working days of paid vacation in the first year, rising by two days each year to 20 days in the fifth year, and then by two days for each further five years of service: 22 days in years six to ten, 24 in years eleven to fifteen, and so on. On top of vacation salary the employee is owed a prima vacacional, a premium of at least 25% of the pay for the vacation days taken. An EOR quote for Mexico should show vacation accrual and the premium as separate lines, because both are costs the legal employer must fund whether or not the days are taken in a given year.
IMSS, housing and profit sharing
Every employer must register with IMSS, the Mexican social insurance institute, enrol employees and pay the employer-employee contributions that fund healthcare, disability and pensions; IMSS runs the registration and payment rails through its employer portal. On top of IMSS sit the INFONAVIT housing fund contribution of 5% of integrated salary, paid entirely by the employer, and PTU profit sharing, under which employees with at least 60 days of service share 10% of the employer's annual taxable profits, distributed by 31 May. Profit sharing surprises foreign buyers most: it applies to the Mexican employing entity, so under an EOR arrangement you should ask the vendor how PTU is handled for its local entity, in writing.
What the stack means for an EOR comparison
Two vendors quoting the same management fee for the same salary can still deliver very different invoices, because the statutory stack scales with integrated salary, the base that includes aguinaldo, vacation premium and other regular benefits. When comparing quotes, ask each vendor for a full-year cost projection for the actual salary: monthly IMSS and INFONAVIT amounts, the December aguinaldo, the vacation premium at the anniversary, and how PTU is treated. Ask too whether the quoted benefits are the legal floor or include the upgrades common in competitive Mexican hiring, such as extra aguinaldo days or grocery vouchers. This page describes the statutory floor; the employment contract and the vendor's terms control what is actually paid, and nothing here is legal or tax advice.
Questions people ask about employee benefits in mexico
What benefits are mandatory for employees in Mexico?
At minimum: an aguinaldo of 15 days' salary before 20 December, paid vacation starting at 12 working days in year one, a vacation premium of at least 25% of vacation pay, IMSS social insurance enrolment, the employer-paid INFONAVIT housing contribution of 5%, and a share of 10% of the employer's taxable profits for eligible staff.
How much vacation do employees in Mexico get?
Since the 2023 reform, 12 working days in the first year, rising by two days a year to 20 days in year five, then by two days for each further five years of service. Before the reform the first-year figure was six days, so older summaries understate the entitlement.
Is the aguinaldo the same as a discretionary bonus?
No. It is a statutory right of at least 15 days' salary payable before 20 December, with a proportional amount for partial years. An employer cannot substitute a performance bonus for it, and a worker has a year to claim it if unpaid.
Does an EOR change what benefits must be paid in Mexico?
No. The EOR is the legal employer and owes the full statutory stack. What changes is who administers it; a good vendor itemises aguinaldo, vacation premium, IMSS, INFONAVIT and PTU handling in the quote instead of hiding them in a bundled rate.