PTO in Mexico: Paid Vacation, Holidays & Carryover Rules
Managing PTO in Mexico is critical for both employers and employees. Paid time off supports work-life balance and ensures compliance with labor law. Since 2023, reforms have increased vacation entitlements, making it even more important for companies to track correctly. Employers hiring in Mexico must understand vacation leave, the mandatory vacation bonus, public holidays, and termination rules. This guide will help you navigate PTO in Mexico and keep your company fully compliant.
Discover more insights on leave and PTO in Mexico.
Quick overview of PTO and leave regulations
Statutory Vacation Days
Since 2023, employees are entitled to 12 days of paid vacation (PTO) after one year of service. This increases by 2 days per year up to 20 days by the sixth year, and then by 2 days every five years thereafter.
Vacation Bonus (Prima Vacacional)
Along with vacation days, employees must receive a vacation bonus of at least 25% of salary during time off. This is mandatory and must be paid through payroll.
PTO Carryover Rules
The law does not require carryover of unused vacation days. However, many employers allow some flexibility. Best practice is for employees to use their vacation within 6 months after their entitlement anniversary.
Statutory Vacation Days in Mexico
Employees in Mexico earn statutory vacation leave after one year of service. Since 2023, the entitlement starts at 12 days of PTO. Each additional year adds two more days, reaching 20 days by the sixth year. From year seven, vacation time grows by two days every five years.
Here’s how PTO in Mexico works at a glance:
| Years of Service | Vacation Days |
|---|---|
| 1 year | 12 days |
| 2 years | 14 days |
| 3 years | 16 days |
| 4 years | 18 days |
| 5 years | 20 days |
| 6+ years | +2 days every 5 years |
Employers must ensure employees use their vacation days within six months of entitlement.
Beyond vacation days, employees may also be entitled to other forms of leave. Learn more in our guide on Special Leave in Mexico.
Eligibility
To qualify for statutory vacation in Mexico, employees must complete twelve continuous months of service with the same employer. This rule applies regardless of the type of employment contract, whether indefinite or fixed-term.
All employees and workers in Mexico can take this holiday leave including:
- full-time and part-time employees
- regardless of their seniority, employment qualifications, nature of compensation, and working hours.
If the employee changes employers, the service period resets, and vacation entitlement accrues again from zero, exept in cases of company mergers or acquisitions.
Vacation Bonus (Prima Vacacional)
In addition to vacation days, employees are entitled to a vacation bonus. This is at least 25% of their regular salary during PTO. For example, if an employee earns 1,000 MXN per day, they must receive an additional 250 MXN per vacation day. This bonus is mandatory and must be included in payroll calculations. Employers who fail to pay risk legal claims and penalties.
How to Manage PTO in Mexico
Managing PTO in Mexico requires precision. Employers must track accruals, apply the vacation premium, and integrate public holidays. Termination payouts must also be accurate. For international companies, these rules can seem complex.
In most cases, the employee submits a vacation request in writing or through the internal HR portal. The employer has the responsibility to approve and schedule the vacation.
Importantly, the employer must ensure the employee takes vacation within 6 months after the end of the service year in which it was accrued. If this does not happen, the vacation days may expire unless the delay was caused by the employer.
« Vacations must be granted to employees within six months following the completion of one year of service. Employers shall annually provide their employees with a certificate indicating their length of service, the vacation period to which they are entitled based on that seniority, and the date on which the vacation must be taken. » – Federal Labor Law, Article 81
While the law guarantees 12 continuous days, workers may choose to split them across different periods based on their personal needs — as long as it aligns with company policies and operational considerations.
« Of the total vacation period granted in accordance with Article 76 of this Law, the employee shall take at least twelve consecutive days. This period may, at the employee’s discretion, be distributed in the manner and at the time they require. » – Federal Labor Law, Article 78
PTO Carryover & Selling Rules
Under Mexican law, unused PTO does not roll over. However, employers and employees may agree on limited carryover. Best practice is to ensure vacation is taken within six months after the anniversary date. This approach avoids disputes and ensures compliance. Offering flexibility beyond the legal minimum is often seen as a competitive benefit.
Mexican law does not allow selling unused vacation days, unless the employment relationship ends. In that case, employers must pay the value of unused days along with the corresponding vacation premium.
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PTO Payout on Termination
When an employee leaves the company—whether through resignation, dismissal, or contract expiration—they must receive a final payment. This includes:
The proportional part of the vacation days not taken
The corresponding vacation premium (25%)
Timely and accurate settlement protects both parties and avoids legal disputes.
To learn more about other types of leave in Mexico, visit our detailed guide on End of Employment and Termination in Mexico
Key Considerations For Employees And Employers
Employers
- Provide a minimum of 12 paid vacation days after one year of service.
- Pay the mandatory vacation bonus of at least 25%.
- Maintain accurate records of vacation and sick leave.
- Pro-rate leave entitlements fairly for part-time employees.
Employees
- Earn 12 vacation days after completing their first year.
- They receive a vacation premium during paid leave.
- They must be used the PTO days within 6 months after the first year of service.
- Unused vacation days cannot be sold.
Conclusion
PTO in Mexico combines vacation days, a 25% vacation bonus, and paid public holidays. Employers must also respect rules on carryover and termination payouts. Managing these obligations is essential for compliance and employee satisfaction. With Europortage, you can hire and manage teams in Mexico confidently, knowing PTO and leave policies are always handled correctly.
This guide covers PTO in Mexico, but for a complete overview of all leave entitlements, visit our Ultimate Guide to Employee Leave in Mexico
