Christmas bonus in Mexico or aguinaldo is one of the most important employee benefits in the country. If you wish to start a business in Mexico and hire employees, reading this article is a good idea. Regardless of starting a manufacturing company in Mexico or a nearshore software development firm, your employees are entitled to a Christmas bonus every year.
This is a mandatory benefit. This is stated in Article 87 of the Labor Law. It must be at least 15 days, although some companies may give a little extra to their employees. This must be paid before the 20th of December. However, if the worker has not worked for the company for at least a year, he is only entitled to the proportional part he has worked.
This benefit was created in 1970 with a Mexican Federal Labor Law reform. However, it can be traced to ancient Rome. There is more than one theory regarding the etymology of the word aguinaldo, but all agree that it was a gift given at Christmas (or the ancient equivalent of the tradition). The United Kingdom, for example, also has a Christmas bonus of 10 pounds. The idea behind giving a Christmas bonus in Mexico is for workers to have extra cash to enjoy the holidays.
2023 Update
As you may know, Mexico’s current president, Andres Manuel Lopez Obrador, is heading to the end of his term, and there will be elections in June 2024. This always generates political turmoil, and politicians try their best to gain votes. Therefore, there is a project for a labor law reform that would grant Mexican employees 30 days of Christmas bonus instead of the current 15 days. We still do not know if the reform will be passed, but it appears to be strongly supported.
How to Calculate Christmas Bonus in Mexico
If the employee has worked in the company for over a year, you calculate the Christmas bonus in Mexico as follows.
- Divide the employee’s monthly salary by 30 to obtain the daily salary.
- Multiply the daily salary by 15.
It gets a little more complicated if the employee has worked for the company for less than a year. For this example, let us say the employee has worked 250 days.
- Divide the 15 Christmas bonus days by 365 (the total days in a year); this gives us a factor. 15 days / 365 days = 0.041
- Multiply this factor by the number of days the employee worked. 0.041 x 250 = 10.25 days. This is the proportional amount of days he is entitled to.
- Divide the employee’s monthly salary by 30 to obtain the daily salary.
- Multiply the daily salary by 10.25 (the proportional Christmas bonus in Mexico)
