COVID-19. Three Legal Aspects for Your Company

As is well known, the current crisis is directly affecting the economy and the operation of your MSME. To a large extent, this is due to the social distancing that comes with reducing the consumption of your products and services.

However, social distancing is not the only element that contributes to the deterioration of your MSME, but another element to address is the legal one in labor, social security, fiscal and even criminal matters.

1. What should you consider in labor and social security matters?

It is important to know that, despite the fact that it was declared as a health emergency due to force majeure and it was established that all non-essential activities (non-essential activities that do not belong to the fields of health, safety and protection, energy, water, food and essentials, among others) should be suspended, there is no legal basis for the reduction of the salary or its total suspension. Therefore, you are required to pay full and full wage to your workers, whether or not they are working.

• What if you don't have the financial support to do it? Don't worry, you can celebrate a Agreement with your worker, by means of which you establish some other modality for the payment of the salary. This agreement must be ratified before the Conciliation and Arbitration Board. It's about negotiating and getting a deal that benefits you and your workers.

As for the social security, you still have to pay worker-employer fees; however, on April 13, 2020, a statement was issued by the Technical Council of the IMSS allowing the holding of a agreement to defer payment of employer contributions by 80% for a maximum period of 48 months. Workers' dues have yet to be paid in full and in full.

2. What is happening in fiscal matters?

There are still no criteria or decree establishing that tax exemptions, cancellations and deferrals are appropriate. However, a wide variety of Amparo lawsuits to protect those who promote them, so that obligations to pay taxes and various contributions are suspended. It is important to mention that the amparo has not yet been resolved or any resolution has been issued, so everything is up to us.

3. And now, is there also Criminal Responsibility?

The answer is “IT DEPENDS”.

You will be subject to responsibility when you did not comply with the measures of the health emergency, did not suspend activities and, most importantly, you forced or conditioned your worker to work.

If you informed your worker that their attendance was not mandatory nor did you condition them to attend, but the worker attended of their own free will, then you are not subject to criminal liability any.

With regard to your MSME as a legal person, is exempt from criminal liability.

So now you know, take these three factors into account and implement the necessary measures to avoid sanctions or liabilities that we don't want to face. I recommend a culture of prevention and compliance.