Mexican researchers have found that profit payments are being paid to less than a quarter of the working population.
The system of profit payment, which has been in effect in Mexico since 1963, is paid to around 8 million of the country’s 34.3 million employees.
Jesus Sanchez Arciniega, researcher at UNAM, says only about 8 million out of 34.3 million employees in the country are benefiting from the PTU (Participation of Workers in Profits), noting that “many do not receive what they are entitled to by law.”
He says that while there are no official figures of just how many of Mexico’s workers actually receive the benefit, it is estimated that there are about 8 million who receive part of the company’s profits,” he said.
According to the professor, informality is one of the reasons employees do not pay the profits since more than 50 percent of the employed population work in the so-called underground economy.
“On the one hand there are people who work on their own, but on the other hand there are salaried women who are not on the payroll and therefore, have no right to the benefit,” he said.
He explained that many companies also buy durable goods prior to the payout to show a loss.
He explained that companies in Mexico will buy durable goods prior to the delivery of the PTU, such as expensive machinery, to record less profits or a total profit loss, which impacts the workforce.
The president of the Mexican Institute of Finance Executives, Fernando López Macari, says ideally it would work better if they moved to a productivity scheme where the most productive employee gets a higher remuneration.
This would be the ideal scheme for Mexico and would work better to avoid these distortions that are currently registered,” said Macari.