Mexico: Supreme Court reaffirms that unilateral pay cuts by employers are illegal

At a time when many firms in Mexico have moved to cut pay as they grapple with the pandemic, an opinion issued by the Supreme Court on 1 October 2021 serves as a reminder that a pay reduction decided unilaterally by an employer, and not for any of the justifiable motives set out in the Mexican Federal Labour Law, may legitimately be cited by an employee as a breach of the employment contract. Furthermore, in the event of a dispute, it will be up to the employer to show they have not cut pay unjustifiably.