Mexico and the United States have signed a tax exchange information agreement to assist the two countries in enforcing their tax laws. The agreement covers information that may affect the determination, assessment, and collection of taxes, and investigation and prosecution of tax crimes. A financial information exchange agreement took effect in 1995 that permits the exchange of information with respect to certain currency transactions to combat illicit activities. The two countries also have signed a bilateral tax treaty, the basic purpose of which is to avoid double taxation of income and to prevent tax evasion. Mexico's federal labor law, enacted in 1931 and revised in 1970, is based on Article 132 of the Mexican Constitution.
Mexican workers enjoy the right to associate, bargain, and strike.
The labor law sets a standard forty-eight hour workweek with one paid day of rest. For overtime, workers must be paid twice their normal rate and three times the hourly rate for overtime more than nine hours per week. Companies are also responsible for additional costs for the employee according to the federal labor law. These usually add about 30-35 percent to the basic wage cost. Employers must also contribute a tax-deductible 2 percent of each employee's salary into an individual retirement account.