The Ministry of Labor and Social Welfare (“STPS”) prepared the Guidelines for Compiling with the Obligations in the Matter of Profit Sharing (the “Guidelines”) resulting from the amendments to the Federal Labor Law (the “Law”), in order to guarantee such Constitutional right to all workers who render subordinate services to an individual or company.
The Guideline determines that the calculation of the employee profit sharing percentage (“PTU” for its initials in Spanish) must be of the 10% of the profits. According to the Law, such percentage will be divided in two parts: i) 5% which will be equally distributed among all employees, considering the number of worked days by each one during the year; and ii) the remaining 5% will be proportionally distributed to the amount of wages earned for the work performed during the year.
It is stated a 90 days salary limit for the payment of PTU, unless the average amount of PTU paid by the company to the employees according to their category in the last three years is greater than 90 days, then such averaged amount must be paid.
The payment obligation is effective from April 1st to May 30th for corporations, and from May 1 to June 29 in the case of individuals. It should be taken into consideration that the Law contemplates exceptions to the payment of such PTU.
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