Sector Commits to Zero Layoffs

As economies worldwide contract in reaction to sudden COVID-19 shutdowns, public and private sector leaders are asking commercial and retail players to commit to zero layoffs in an effort to support the population during the crisis.

This commitment can be negotiated between the public and private sector or be mandated by the public sector. President López Obrador has been vocal in his daily morning press conferences regarding the praising of business leaders who adopt this policy as a way of persuading others to do the same. Businessman Carlos Slim has committed to not firing anyone that works in any of his companies. El Universal reports that the president was happy to share these news with the public, and used it as an example for other private sector entities to follow. El Financiero reports that Slim also plans on donating almost US$43 million to COVID-19 measures. Other major companies in the sector have adopted this policy. For example, Radioformula reports that multiplex giant Cinepolis has now closed all of its Mexico branches, while simultaneously making this same zero layoff commitment. 

Mexico City Mayor Claudia Sheinbaum recently announced that after extensive talks with industry chambers for the retail and services industries, particularly restaurants, an agreement has been reached for a zero-layoff policy. El Universal reports that this agreement will extend at least until April 19 and that in some cases businesses have agreed to cover the payment of salaries during this period. 

While no explicit mandate has been enacted as of yet to prevent layoffs, there are a number of conversations surrounding the degree of support this measure would find in Mexican law, as pointed out by a recent video feature in Expansión. As this video also points out, companies are still legally obligated to cover 100 percent severance pay, a fact that is flying in the face of recent events such as the mass closing and firings of scooter company Grin with no severance pay, as reported by Diario de México.