Friday, June 21, 2024

Does AMLO’s proposed outsourcing ban actually help?

As a wary, bloodied-and-bruised-by-reality AMLO supporter, I often find myself agreeing with his basic ideas regarding what’s wrong with labor and the economy but screaming and pulling my hair in frustration when it comes to his ideas for fixing those problems. It’s a bit of an inversion of the Republicans who abhorred Trump’s crass, obscene style, but held their noses and voted for him because he got them many of the results they wanted.

This is how I felt, once again, when reading about his proposal to force companies to gain federal authorization before hiring contract labor, or “outsourcing.”

AMLO stated, correctly, that “…outsourcing currently causes mass dismissals at the end of the year because companies want to avoid paying bonuses and other benefits to employees as well as prevent them from accumulating seniority.”

This is, unfortunately, a correct assessment of the situation for far too many workers. Even for those who are able to escape the long cycle of being “officially” fired and rehired – or never put on the books officially in the first place – there’s still the issue of job security in general (or lack thereof).

And a depressed labor market in general, especially during this pandemic in which a million small-businesses have permanently closed, means that for the foreseeable future many employers will continue to brazenly offer 1500 pesos a week for hours that add up to a full-time job and a half in cash with no paperwork, benefits, or job security. In my home city of Xalapa, that’s actually considered a reasonable wage even for professional jobs that require college degrees; if the job does happen to offer benefits, then pay is generally lower.

I know this game: I’ve been playing it on the losing side’s team for years, as have most people my age. As a longtime “independent contractor” myself in a variety of jobs, I’ve often lamented the fact that my fancy university education no longer begets the kind of formal, salaried and decently paid job (I’ve grown too cynical at this point to fantasize about anything I’d consider “well-paid”) with full benefits that it once did.

Most of my experience before becoming a full-time freelance writer and translator was in teaching. Save a few years at a high school, I’ve always done so as an independent contractor. While the same level of education and experience has always been required at these jobs as when they used to be secure, salaried positions, what is given in exchange for them these days is much, much less. Even if you want to piece together full-time employment from various jobs, there is no guarantee of being able to work all the hours you want to, as companies and employers increasingly expect the workers to absorb the market blows when demand goes down.

When people then have the audacity to suggest that workers should have simply chosen a better job or profession, it’s all I can do to not scream.

That said, I’ve been at a great advantage because of my privilege as a college-educated bilingual US citizen in the digital age. While what I earn freelancing would not allow me to live above the poverty line in my own country, it stretches quite a bit more generously here. Earning even low US rates while in Mexico puts you at a fairly decent income level; it’s hard to be too frustrated.

Still, I worry. I don’t make enough consistently enough to have any kind of real savings, and should I not be able to work for whatever reason, there’s no official or guaranteed safety net below me. This issue was easy enough to shrug off as a problem for later when I was younger, but I have a kid now. What happens if I’m suddenly unable to bring in money?

It is one of my most deeply held beliefs that anyone who works hard at a full-time job should live comfortably, period. But when more and more people are being hired as independent contractors rather than proper employees, it can make the low pay the least of their problems next to the lack of any kind of worker protections.

In Mexico, there are certainly many more independent contractor jobs than before, and many of those workers perform duties that are essential to the everyday running of the business that hired them.

Business leaders are scared about this new legislation, and while I don’t think the proposed changes are the best way to go after the problem, I also do not feel sorry for them: if your business model depends on paying your workers less than living wages and classifying them in ways that allow you to avoid taxes on top of that, then you have a failed business model that is bad for workers, and bad for society.

Let’s get real. The point of hiring independent contractors, in theory, is because you truly need temporary help with something that is not usually part of the everyday duties needed to run the business. Examples of reasons to hire an independent contractor are, for example, to hire a decorator or an architect to redo your offices, to hire a consultant to help audit your management system or to contract with a caterer to feed attendants at a conference.

If you’re hiring teachers as contractors, then you’re simply being stingy and dishonest about how essential they are to your business.

Rather than forcing businesses to seek approval from the government, how about just making employers pay all the same taxes and benefits on their workers across the board? How about making those benefits mobile so that they can travel with the worker from place to place?

For example, a temporary seasonal worker at a department store during the busy Christmas season could receive a prorated percentage of prestaciones de ley, which are the benefits that workers in Mexico are entitled to. This would include things like the December bonus, a certain number of paid vacation days, social security etc. Then those accumulated benefits would travel with that worker to their next job, even if it’s another temporary one, where they would earn additional prorated benefits.

Business leaders now have until at least February to negotiate with AMLO on this issue. But whatever we do, let’s keep our eyes on the main goal: the welfare of workers.

Sarah DeVries is a writer and translator based in Xalapa, Veracruz. She can be reached through her website,

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