What are the statutory pension benefits in Mexico?

In Mexico, statutory pension benefits include both retirement and long-term disability pensions.

Retirement Pension:

• Retirement benefits are managed through a Retirement Fund Administrator (AFORE), which the supported employee selects.
• Both the employer and the supported employee contribute to the retirement fund. The total retirement benefits rely on the accumulated value in the supported employee's AFORE account.
• The retirement age is 65 years for both women and men, with a requirement of at least 1,250 weeks of contributions to the Mexican Institute of Social Security (IMSS).
• Contributions to the IMSS consist of:
• A percentage of the supported employee’s base salary (Quotation Base Salary [SBC]) from the employer for retirement.
• A percentage of the supported employee’s base salary from the employer for premature retirement.
• The supported employee also contributes a portion of their base salary toward early retirement.

Long-Term Disability Pension:

• Supported employees may qualify if they experience a non-work-related accident or illness preventing them from earning more than 50% of their salary from the previous year.
• Eligibility requires that the disability result from a non-occupational illness or accident.

Pension benefits in Mexico are funded by contributions from both the employer and the supported employee through the social system and are overseen by the AFORE. If a supported employee passes away while working, employers must offer a service benefit, and the survivors are entitled to a pension based on the total value in the deceased’s account, along with a funeral payment.