You are resigning from your position in Mexico or facing termination and need an independent, legally sound calculation to verify whether the severance settlement drafted by HR conforms to the Federal Labor Law.
How to use Calculate Mexico Severance step by step
1. Select termination reason
Choose voluntary resignation (statutory finiquito) or unjustified dismissal (finiquito plus 3-month indemnity).
2. Enter wages and tenure
Type your gross monthly salary along with your service tenure in completed years, months, and days.
3. Inspect itemized legal breakdown
Instantly view accrued aguinaldo bonus, statutory vacation days, vacation premium, and total payable amount.
The Step Count: Traditional Friction vs. KorexTools
Calculating Mexican severance on paper (6 complex steps)
- Divide monthly regular salary by 30 to determine daily wage.
- Calculate worked calendar days in current year to prorate the 15-day aguinaldo bonus.
- Check statutory vacation scale based on tenure years and compute 25% vacation premium.
- Verify if seniority premium applies (Art. 162) and apply the 2 minimum wage ceiling.
- Calculate the Integrated Daily Wage (SDI) factoring in bonus and vacation benefits if dismissal applies.
- Multiply SDI by 90 days (3 months) plus 20 days per tenure year.
Using Mexico Severance Calculator on KorexTools (3 steps in 2 seconds)
- Select departure reason (voluntary resignation vs unjustified dismissal).
- Enter monthly regular salary and service tenure in years, months, and days.
- Instantly inspect itemized line-by-line breakdown validated against LFT articles.
Legal distinction between Finiquito and Liquidación under Mexican labor law
Under Mexican Federal Labor Law (LFT), a critical legal distinction exists between finiquito and liquidación. A finiquito consists of accrued, non-waivable statutory rights owed to the employee regardless of departure circumstances (unpaid wages, prorated bonus, unused statutory vacation, and vacation premium).
Liquidación (constitutional severance indemnity), however, is legally mandated solely when termination occurs without statutory justification on the employer side (unjustified dismissal). In such cases, the law awards 3 months of integrated daily wage plus 20 days per year of tenure.
Impact of the Dignified Vacations reform on settlement calculations (Art. 76 LFT)
- •First year tenure: Entitles workers to an upgraded baseline of 12 statutory paid vacation days.
- •Biennial scaling: Expands by 2 additional days annually until reaching 20 days during year five.
- •25% Vacation Premium: Pursuant to Art. 80 LFT, employers must furnish at least 25% on top of earned vacation pay.
- •Seniority Premium (Art. 162): 12 days per year of service; in voluntary resignation requires 15 years tenure, but applies automatically upon dismissal capped at 2 minimum wages.
Legal comparison: Voluntary Resignation vs Unjustified Dismissal ($15,000 MXN / 2 Years)
| Labor Concept | Voluntary Resignation (Finiquito) | Unjustified Dismissal (Liquidación) |
|---|---|---|
| Prorated Aguinaldo (Art. 87) | Yes (Prorated to current year) | Yes (Prorated to current year) |
| Statutory Vacation (Art. 76) | Yes (14 days prorated) | Yes (14 days prorated) |
| Vacation Premium 25% (Art. 80) | Yes (25% over vacation pay) | Yes (25% over vacation pay) |
| 3 Months Constitutional (Art. 48) | Does not apply ($0.00) | Yes ($47,250 MXN integrated) |
| 20 Days per Year Tenure (Art. 50) | Does not apply ($0.00) | Yes (40 days integrated salary) |
Common Mistakes and How to Avoid Them
- ⚠️Signing voluntary resignation forms when termination was initiated by the employer.
- ⚠️Forgetting the mandatory 25% vacation bonus on accrued unused vacation days.
- ⚠️Using outdated pre-reform vacation scales (6 days) instead of the 12-day minimum under Vacaciones Dignas.
Frequently Asked Questions
What statutory concepts make up a voluntary resignation finiquito in Mexico?
You are legally entitled to unpaid earned days, prorated aguinaldo bonus, prorated dignified vacation days, and the 25% vacation premium. Workers with 15+ years also collect the seniority premium.
What is the financial difference between finiquito and liquidación?
A finiquito only reimburses accrued earnings. Liquidación adds a 3-month integrated salary constitutional payout and 20 days per year of service for unjustified termination.
What is the employer deadline to disburse severance pay in Mexico?
Mexican law dictates that settlement payments must be rendered on the effective departure date or upon mediation at the Labor Conciliation Center.
What if an employer coerces an employee into signing a blank resignation form?
Coerced blank resignations are strictly prohibited by law. Employees should refuse to sign and contact PROFEDET for free legal defense.
What I would do if I were in your shoes
Never sign a voluntary resignation if you are being laid off: unjustified dismissal legally entitles you to 3 months of integrated salary plus 20 days per year of tenure.