Appendix B - Glossary
Appendix B. Glossary
Annual bonus, aguinaldo
Mexico: Federal Labor Law mandates that workers have the legal right to receive an annual bonus, aguinaldo, equal to 15 days’ wages or more. This bonus must be paid before December 20 of each year. Workers with less than one year’s service will be paid a prorated portion of the annual bonus.
Causes for Justified Termination of Work
Canada:
Just causes for terminating an employee vary from jurisdiction to jurisdiction. In Ontario, for example, an employee may be terminated if he or she is:
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employed for a definite term or task;
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temporarily laid off, as defined in the regulations;
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guilty of willful misconduct or disobedience or willful neglect of duty that has not been condoned by the employer;
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under a contract of employment that is or has become impossible to fulfil or is frustrated by a fortuitous or unforeseeable event or circumstance; or
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employed in an activity, business, work, trade, occupation or profession, or any part thereof, that is exempted by regulations from unjust dismissal legislation.
Mexico:
An employee may be terminated if:
- the worker deceives the employer about the worker’s abilities, skills or qualities;
- the worker, while doing his or her job, commits a dishonest or illegal action, violence, threats or ill-treatment towards the employer or any member of the employer’s family or the top management of the enterprise, except in the case of provocation or self-defense;
- the worker is guilty of any of the acts mentioned above toward any of his or her fellow workers and the discipline of the workplace is affected as a consequence of such acts;
- the worker is guilty, outside his or her employment, of any of the acts mentioned above towards the employer or any member of the employer’s family or the top management of the enterprise, and the said acts are of such a serious nature as to render the fulfillment of the labor contract impossible;
- the worker in the performance of his or her work, or in connection it, willfully causes material damage to the buildings, works, machinery, tools, raw materials or other objects connected with the work;
- the worker causes serious damage as mentioned above, acting without malicious intent but with negligence which is the sole cause of the damage;
- the worker by inexcusable imprudence or carelessness endangers the safety of the establishment or any person in it;
- the worker is guilty of immoral conduct in the workplace;
- the worker reveals manufacturing secrets or communicates matters of a private character to the detriment of the enterprise;
- the worker is absent from work more than three times in a 30-day period without the employer’s permission or without sufficient reason;
- the worker refuses to obey the employer without sufficient reason in matters connected with the work under contract;
- the worker refuses to adopt preventive measures or follow the procedures laid down for the prevention of accidents or disease;
- the worker reports for work in a state of intoxication or under the influence of drugs, unless he or she has a medical prescription;
- a court of law has sentenced the worker to a term of imprisonment that prevents him or her from working; or
- for reasons similar to those mentioned above if they are of equal gravity and entail similar consequences.
Disability for Other than Job-related Reasons
Mexico: A disability caused by other than a job-related injury or illness that leaves a worker unable to earn, in a similar job, more than 50 percent of his or her income in the last year of service.
Earned Income for Child Tax Benefits
Canada: The benefit is based on your total taxable income for the year.
United States: The benefit is based on all the income you receive from working, including nontaxable benefits like the value of meals or lodgings provided by the employer or voluntary salary deferrals.
Earnings
Canada: With a few exceptions, earnings include any money an employer pays an employee under the terms of a contract of employment, whether that contract is oral or written. The main exceptions, not counted in earnings, are tips, gifts or bonuses, travelling allowances, and contributions made by an employer to a fund or benefit plan.
Mexico: All wages, benefits and other payments to workers for food, housing, and other non-cash payments are considered insurable earnings at IMSS. There are some exceptions: cash or non-cash bonuses, overtime payments, and premiums paid by the employer to insurance or benefit plans are not included.
Eligible Person for Child Tax Benefits
Canada: The person primarily responsible for the care and upbringing of a child. This may be the mother, father, a grandparent or a guardian. He or she must live with the child and be a resident of Canada for income tax purposes.
United States: Any person or family whose annual income is less than $25,760 with one qualifying child, or less than $29,290 with two or more qualifying children is eligible for the benefit. Taxpayers who do not have a qualifying child may be eligible for an earned income benefit if they earn less than $9,770.
Employee
Canada: An employee is defined as any person employed by an employer.
Mexico: Any person who performs a subordinate work for another individual or legal person.
Employer
Canada: Any person who employs one or more employees.
Mexico: Any individual or legal person using the services of one or more workers.
United States: An entity or individual that employs one or more individuals for some portion of a day in each of 20 weeks or paid wages of $1,500 or more during any calendar quarter in the current or immediately preceding calendar year.
Employers for Purposes of Unemployment Insurance
Canada: In general, all employers are required to pay premiums to the Employment Insurance program.
United States: In general, all employers (as defined above) are required to pay federal unemployment insurance taxes. Agricultural employers become subject to the tax if they pay $20,000 or more in any calendar quarter for agricultural labor.
Fair Labor Standards Act 1938 (FLSA)
The federal law in the United States of general applicability regarding rights of employees to receive no less than the federal minimum wage rate (presently set at $5.15 per hour), and a premium rate for over-time. It also contains child labor standards.
Hours of Work
Mexico: Time during which an employee lends his or her services to an employer for the performance of the work.
United States: Any time spent in physical or mental exertion which is suffered or permitted, controlled or required by the employer; all hours an employee is required to give to the employer, including time spent waiting, if it is primarily for the employer’s benefit; and all time during a workweek that an employee is required to be at a prescribed workplace or on duty.
Industries and Sectors under Federal Jurisdiction
Canada:
Industries of an extra-provincial or international character: railways; highway transport; telephone and telegraph systems; pipelines; canals; ferries, tunnels and bridges; shipping and shipping services; radio and television broadcasting and cable systems; airports; banks; grain elevators licensed by the Canadian Grain Commission, and certain feed mills and feed warehouses, flour mills and grain seed cleaning plants; the federal public service (for occupational safety and health purposes); employment in the operation of ships, trains and aircraft; and exploration and development of petroleum on lands subject to federal jurisdiction.
Mexico:
Industries: textiles; electrical; cinematography; rubber; sugar; mining; metallurgy and steel; hydrocarbons; petrochemicals; cement; lime-kilns; automotive industry, including mechanical or electrical auto parts; chemicals, including pharmaceutical chemicals and medicines; cellulose and paper; vegetable oils and grease; food production, covering exclusively the manufacture of foods that are packed, canned or barreled, or are destined for such processing; manufacture of beverages that are barreled or canned or are destined for such processing; railways; basic woodworking, including the production of sawdust and the manufacture of plywood; glass-making, exclusively the manufacture of plate glass or barreled glass; the making or manufacture of tobacco products; and banking services.
Enterprises: those which are administered directly by the federal government or by its decentralized organizations; those operating under federal contract or concession and those which are connected; those operating in federal zones or under federal jurisdiction, in federal territorial waters or in the exclusive economic zone of the Nation.
Instituto del Fondo Nacional para la Vivienda de los Trabajadores, INFONAVIT (Employee’s Housing Fund Institute)
Mexico: An economically and legally independent social service institution created to administer the Fondo Nacional de la Vivienda (Employee’s Housing Fund) and to operate a financial system to allow workers to get credit at low rates to buy, build or repair their houses.
Length-of-service bonus
Mexico: Payment consisting of 12 s’ wages for each year of service to permanent workers who resign voluntarily, on condition that they have completed at least 15 years of service with the same employer, or whose employment is terminated either for justified or unjustified reasons. Temporary workers with more than 15 years of service with the same employer are entitled to be recognized for their seniority and to be paid a length-of-service bonus.
Ley Federal del Trabajo, LFT (Federal Labor Law)
Mexican Law of general application throughout the republic which governs labor relations, referred to in Article 123 of the Constitution.
Minimum Wage
Canada: The minimum payment that a worker must receive for an hour’s work.
Mexico: The smallest cash payment that a worker must receive for an ordinary day’s work. The minimum wage is fixed annually and usually is effective from January 1. The minimum wage can be reviewed at any time if it is necessary for economic reasons.
United States: The minimum payment that a worker must receive for an hour’s work. Compensation counted as part of the minimum wage includes wages, salaries, commissions, and other cash payments, as well as certain non-cash payments such as customarily furnished meals, lodging and other facilities. The employer may also credit toward the minimum wage a portion of the tips employees receive from customers or from a tip-pool arrangement.
Minimum Wage Areas
Mexico:
Geographical Area A
Baja California and Baja California Sur: all counties in the states.
Chihuahua: Guadalupe, Praxedis G, Juárez, and Guerrero.
Distrito Federal: Acapulco de Juárez, Atizpan de Zaragoza, Coalcalco de Berriozábal, and Cuautitlán.
Sonora: Agua Prieta, General Plutarco Elías Calles, Cananea, Puerto Peñasco, Nogales, San Luis Río Colorado, and San Cruz.
Tamaulipas: Camargo, Miguel Alemán, Guerrero, Nuevo Laredo, Gustavo Díaz Ordaz, Reynosa, Matamoros, San Fernando, Mier, and Valle Hermoso.
Veracruz: Agua Dulce, Ixhuatlán del Sureste, Coatzacoalcos, Minatitlán, Cosoleacaque, Moloacán, las Choapas, and Nanchital de Lázaro Cárdenas del Rio.
Geographical Area B
Jalisco: Guadalajara, Tlaquepaque, El Salto, Tonalá, Tlajomulco de Zuñiga, and Zapopan.
Nuevo Leon: Apodaca, Guadalupe, San Pedro Garza García, San Nicolás de los Garza, Escobedo, and Santa Catarina.
Sonora: Altar, Imuris, Atil, Magdalena, Bácum, Navojoa, Benjamín Hill, Opodepe, Caborca, Oquitoa, Cajeme, San Ignacio Río Muerto, Pitiquito, Carbó, La Colorada, San Miguel de Horcasitas, Cucurpe, Santa Ana, Empalme, Sáric, Etchojoa, Suaqui Grande, Guaymas, Trincheras, Hermosillo, Tubutama, and Huatabampo.
Tamaulipas: Aldama, González, Altamira, El Mante, Antiguo Morelos, Nuevo Morelos, Ciudad Madero,Ocampo, Tampico, Gómez Farías, and Xicoténcatl.
Veracruz: Coatzintla, Tuxpan, and Poza Rica de Hidalgo.
Geographical Area C
All counties in the states of:
Aguascalientes Oaxaca
Campeche Puebla
Coahuila Querétaro
Colima Quintana Roo
Chiapas San Luis Potosí
Durango Sinaloa
Guanajuato Tabasco
Hidalgo Tlaxcala
Michoacán Yucatán
Morelos Zacatecas
Nayarit
In addition, all counties in the states of Chihuahua, Guerrero, Jalisco, México, Nuevo león, Sonora, Tamaulipas and Veracruz not included in areas A and B.
Occupational Injury
Any accident or disease to which workers are exposed in the course of employment or as a consequence of their work.
Permanent Partial Disability for Reasons Related to Work
Mexico: Reduction of a person’s ability to work for reasons related to work.
United States: any disability that makes a person unable to perform any substantial gainful work. Social Security usually permits a partially disabled person to earn up to about $500 per month before considering that the person is doing gainful work (and reducing his or her disability benefit).
Permanent Total Disability for Reasons Related to work
The loss of a person’s skills or ability to work that renders him or her incapable of doing any work for the rest of his or her life.
Public Holidays
Canada: New Year’s Day, January 1; Good Friday; Victoria Day, May 24; Canada Day, July 1; Labor Day; Thanksgiving Day; Christmas Day, December 25; Boxing Day, December 26.
Mexico: New Year’s Day, January 1; Constitution Day, February 5; Benito Juárez Birthday, March 21; Labor Day, May 1; Independence Day, September 16; Revolution Day, November 20; Christmas Day, December 25, and the first of December every six years when the new administration takes office.
United States: New Year’s Day, January 1; Martin Luther King Jr. Day, January 6; Washington’s Birthday, February 15; Memorial Day, May 31; Independence Day, July 4; Labor Day; Columbus Day, October 12; Veterans’ Day, November 11; Thanksgiving Day; Christmas Day, December 25.
Qualifying Children for Tax Credits
Canada: All children under age 18.
United States: A taxpayer’s son, daughter, adopted child, grandchild, stepchild, or eligible foster child under age 19, or under age 24 and a full-time student, or any age and permanently and totally disabled. The child must live for more than half the year with the person who applies for the tax credit.
Severance Pay
Payment to an employee or former employee in connection with the recipient’s termination of employment.
Severe and Prolonged Disability
Canada: A severe and prolonged disability which prevents a worker from working regularly.
Temporary Disability
Loss of faculties or skills rendering a person either partially or totally unable to perform his or her work for a certain time.
Workers’ Profit-sharing
Mexico: Federal Labor Law (LFT) mandates that all workers shall participate in the profits of the enterprise where they work at a percentage fixed by the Comisión Nacional para la Participación de los Trabajadores en las Utilidades de las Empresas (National Committee for Workers’ Profit-sharing in Enterprises). Enterprises’ profit means the taxable revenue.
Workweek
Mexico: Both employee and employer fix the duration of hours of work, which cannot be higher than the maximum fixed by law. The maximum daily hours of work are: eight hours for day work, seven for night work and seven-and-a-half for working mixed hours. The LFT mandates that for each six days of work, workers will have a day of rest with full pay.
United States: A fixed and regularly recurring period of 168 hours comprising seven consecutive 24-hour periods. The workweek need not coincide with the calendar week and can start on any day at any hour the employer finds convenient.