Outsourcing or subcontracting is define as a business model in which companies subcontract people to carry out specific activities When a company hires an external company to carry out certain activities that are necessary for the operation or services it provides, this is called outsourcing, also know as outsourcing.
For what type of activities is subcontracting use? From the performance of a service, it can be related to aspects of the production or operation of the company, producing some good, by specialization, among others. One of the characteristics of outsourcing in Mexico is that it is regulate by the Federal Labor Law and the Social Security Law.
How does subcontracting law work? It establishes that this type of activity must meet the following conditions:
- cannot cover all the activities, the same or similar in their entirety that is carry out in the workplace.
- It must be justify by its specialized nature.
- You will not be able to understand the same or similar tasks to those carried out by the rest of the workers at the service of the person you hire.
Why? Precisely in this contracting scheme, it is sometimes use to reduce the employers’ obligations; it is regulate so that labor rights are not reduce.
Therefore, what is considered labor subcontracting according to the law? The regime “by means of which an employer called a contractor executes works or provides services with his workers under his dependence, in favor of a contractor, natural or legal person, who sets the tasks of the contractor and supervises him in the development of the services or the execution of the contracted works.
How does subcontracting or outsourcing work in Mexico?
In Mexico, as in other parts of the world, outsourcing works as follows:
- A company decides to subcontract to an external company to perform a service necessary for its operation or to carry out a certain part of its production.
- The company that decides to outsource usually does so to improve efficiency and focus on activities that are essential to them.
- The contractor company is responsible for the service request.
- Even, on some occasions, the company that was hire could subcontract to another company.
- Once a company subcontracts to another to carry out a good or service, it is responsible for carrying it out through its resources and its workers.
What parts are involve in sub hiring? They will be the main company and the company to which it is subcontract.
Examples of Outsourcing
There are many sectors in which we can identify this tool, for example, in the automotive industry in areas such as human resources, IT, technical support, and accounting, among others.
Generally, business outsourcing is chosen because they are areas that are somewhat unrelated to the fundamental activities of the company, as well as for requesting services in a specialized sector that are required for the operation of the contracting company.
Regarding the types of outsourcing, we can find those that are make:
Within the company that subcontracts the service.
In the one where the services are perform from the company that was contract. The modality in which, both the service provider and the main company share responsibilities.
To conclude, if you are considering subcontracting a company for a service that you need. You must be careful in the process. To make sure that it is under a legal scheme, otherwise it could have repercussions for you. According to the Mexican Institute of Social Security (IMSS) for outsourcing to be legal, you must take the following measures:
- Review the staff of the people you have subcontracted. If you identify any who are not likely to be in this scheme. You must hire them and provide them with their rights as workers.
- You should always verify that the contracts with the company. That outsources its services are in writing. Specify that the social and labor security rights of the staff are comply with.
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