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Given the recent general uncertainty resulting from COVID-19, including the executive orders and decrees issued around this matter, we are providing you with practical measures you can adopt to mitigate contingencies.

What has changed

On March 31, 2020, the Federal Health Ministry issued a resolution establishing new measures to combat the national health emergency due to force majeure determined by the National Health Council. This resolution includes the immediate suspension of all non-essential activities from March 30 to April 30, 2020 (the "Suspension Period").

These measures are mandatory nationwide and are aimed to combat the spread of the COVID-19 virus.

What it means for you

During the Suspension Period, all non-essential activities must be immediately suspended.

Under the resolution, the following are considered essential:

  • Activities necessary to directly respond to the health emergency such as medical activities, paramedics, and administrative and support in the entire national health system. Also those who participate in its supply chain and service providers, such as the pharmaceutical sector, both in its production and distribution (pharmacies); the manufacture of supplies, medical equipment and health care technologies; those involved in the proper disposal of bio-infectious hazardous waste, as well as the cleaning and sanitation of medical units at different levels of care.

  • Sectors considered essential for the economy, including financial institutions, the tax revenue system, distribution and sale of energy,gas stations, generation and distribution of potable water, the food industry, nonalcoholic beverages, supermarkets, convenience stores, self-service stores, ready to eat food stores, passenger and cargo transportation, agriculture production, fishing and livestock, agroindustry, chemical industry, cleaning products, hardware stores, courier service, security guards, infant daycare centers, elderly nursing homes, centers for women and children who have been victims of violence, telecommunications, information media, private emergency services, mortuaries, cold storage of essential supplies, transportation logistics (airports, marine ports and train stations), and activities and sectors likely to lose viability if they are suspended.

  • Activities related to the conservation, maintenance and reparation of critical infrastructure guaranteeing the production and distribution of essential services (potable water, electricity, gas, gasoline, oil, jet fuel, basic sanitation, public transportation, first level hospital and medical infrastructure and others that may be defined under this category).

Workplaces considered essential can continue operations provided that: (a) employers do not allow employees to gather in crowds of more than 50 people; (b) employers follow and require employees to follow the preventive measures ordered by the Federal Health Ministry; and (c) employers do not allow vulnerable employees (employees older than 60, or employees who are pregnant or immediate postpartum period, or with hypertension, diabetes, mellitus, cardiac or pulmonary chronic conditions, suppressed immune system, renal and liver insufficiency), to work, regardless of whether their activity is considered essential. 

Once the Suspension Period elapses, the Health Ministry, Economy Ministry and Labor Ministry will issue the guidelines for the orderly, staggered and regional return to labor, economic and social activities.

Action steps

  • Based on the resolution, companies must implement the following measures:
  • Confirm whether their activities fall under the definition of "essential" activities.
  • Implement a formal communication plan to be able to communicate with employees the effects of the suspension.
  • Negotiate and formalize agreements with employees and/or union regarding the payment of compensation during the Suspension Period.
  • Depending on the compensation paid to employees by the company during the Suspension Period, companies should analyze any impact on social security contributions and file any required notices to the Mexican Social Security Institute ("IMSS") and National Housing Fund Institute for Workers ("INFONAVIT").
  • Those employees who can work remotely, must receive full compensation.
  • Review decrees issued by competent local authorities that may impact the company's operation.
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