At Law In Cabo we know that, if the employee fails to comply with any of the obligations set forth in the employment contract and/or in the Internal Labor Regulations or incurs in any of the causes of termination set forth in the Federal Labor Law, the employer may terminate the employment relationship with the employee in a justified manner and without liability. Upon termination of the labor relationship, the employer must deliver to the employee a notice of termination in which the employer will inform the employee of the conduct causing the termination and the date on which it was committed, this notice must be notified personally to the employee or through the Conciliation and Arbitration Board.
Now, if the employee did not fail to comply with the obligations derived from the employment contract or, as the case may be, from the Internal Labor Regulations, or did not incur in any of the causes for termination and the employer decides to terminate the employment relationship, the dismissal will be unjustified.
The Federal Labor Law also establishes that if the employer terminates the employment relationship but does not notify the employee of the termination notice, the dismissal will be unjustified.
The unjustified dismissal consists precisely in the fact that the employer unilaterally decides to terminate the labor relationship with the employee.
Unjustified Dismissal
The circumstances under which an employer may unjustifiably dismiss an employee may be very varied, from personal reasons to discrimination. In practice, these cases occur, but there are also those cases in which the dismissal is justified for the reasons explained in the preceding paragraphs and the employee still considers that the dismissal was unjustified.
The Political Constitution of the United Mexican States protects workers by establishing that the worker may not be dismissed unjustifiably.
A worker who considers that he/she was unjustifiably dismissed may go before the Conciliation and Arbitration Board and sue the employer, optionally claiming reinstatement in his/her job or indemnification.
In the lawsuit, the Board, considering the circumstances of the case, the applicable labor legislation and the evidence offered by the parties, will determine by means of an award whether the dismissal was unjustified or not, and will decide on the reinstatement or indemnification, depending on the action that the employee has exercised.
The following are some general topics related to unjustified dismissal. If you are a worker or an employer and wish to know more about the subject, we invite you to read the answers to frequently asked questions related to unjustified dismissal.
Reinstatement Action
Unjustified Dismissal
When a worker is unjustifiably dismissed by the employer, he/she has the option to sue the employer before the Conciliation and Arbitration Board for the reinstatement in his/her position.
The employee has a two-month term to sue the employer, starting on the day following the day on which the unjustified dismissal occurred.
The employee has a term of two months to sue the employer counted from the day after the unjustified dismissal occurred.
If in the lawsuit the employer did not prove that the dismissal was justified or the cause for termination of the labor relationship, the employer will be ordered to reinstate the employee and to pay him/her the wages due, which will be computed from the date of the dismissal up to a maximum period of twelve months.
Indemnity Action
Unjustified Dismissal
The indemnity action is the other option available to the employee to sue the employer who has unjustifiably dismissed him. Normally this action is exercised by the employee when he/she has no interest in being reinstated in his/her job, and the employee may prefer to be indemnified than to return to a job in which he/she will no longer feel comfortable because he/she has been unjustifiably dismissed.
The employee has a term of two months to sue the employer before the Conciliation and Arbitration Board (Junta de Conciliación y Arbitraje). The term will begin to run from the day following the day on which the unjustified dismissal occurred.
Liquidation – Indemnification
The employee who has been unjustifiably dismissed will have the right to claim payment of the following:
- Indemnity consisting of the amount of three months’ salary (Constitutional Indemnity).
- The proportional part of the Christmas bonus.
- The proportional part of vacation.
- The proportional part of the vacation bonus.
- Seniority premium (if applicable).
- Other current benefits included in the employment contract or in the conditions that regulate the relationship with the company or employer, such as bonuses, commissions, savings fund, utilities, among others.
Now, if the employee exercised the indemnity action and in the lawsuit the employer did not prove that the dismissal was justified or the cause for termination of the labor relationship, it must pay the employee the wages due computed from the date of dismissal up to a maximum period of twelve months, at the rate that corresponds to the date on which the payment is made.
Constitutional indemnity
Unjustified Dismissal
The constitutional indemnity for unjustified dismissal is provided for in article 123 of the Mexican Constitution, paragraph A, section XXII, which provides that the employer who dismisses an employee without just cause must indemnify him/her with the amount of three months’ salary.
This indemnity of three months’ salary is based on the fact that the worker can subsist and meet his expenses and responsibilities during this term, which is considered as the average term for the worker to start a new activity or find a new job. On the other hand, this indemnity is a sanction to the employer for unjustifiably separating the employee from his job.
The assumptions foreseen in the Federal Labor Law for the termination of labor relations are diverse and their configuration in reality may vary and therefore give rise to different legal consequences. The above mentioned in this space is merely informative and illustrative.
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Unjustified Dismissal
