Comparative Pay and Benefit Analysis of India, Mexico and Brazil

Presented By:Gurpreet Singh HanzraZorawar Singh GhumanSavi Sandhu

Video

http://www.youtube.com/watch?v=7rMlwzRdd1E&feature=youtube

Agenda

Compensation structure in India, Mexico and Brazil: General Legislations Employment Conditions Employment Contracts Labor Force/Labor Standards Employment Relationships Wage and Salary Scales Paid time off Benefits Protection Benefits

General Legislation

India-The Payment of Wages Act 1936, The Minimum Wages 1948, The Equal Remuneration Act 1976 ,The Payment of Bonus act 1965 and Workmen's Compensation act 1923.

Mexico-The Federal Labor Law 1931(Article 123 of Constitution) and The Federal Social Security and Housing Law.

Brazil-Labor Law based on Consolidação das Leis do Trabalho (Consolidation of Labor Laws)

Employment Conditions in India Work Week Monday to Saturday(10am-6pm).

Mostly overtime is not paid.

Labor force dominated by men.

Women mostly work in agriculture.

Minimum age to work is 14 years.

Employment Conditions in Mexico

Work week Monday to Saturday(48 hours).

Distinction between overtime (paid double) and work on the day of rest.

Minimum age of employment is 14 years. Ages between 14-16 years work under some restrictions.

Employment Conditions in Brazil

Work week 5 or 6 days a week (40-44 hours).

Minimum age of employment 14 years. Age 14 to 18 years work under protective regulations.

Thousands of worker unions.

Night work is from 10pm-5am compensated at 20% more than regular wages.

Employment Contracts in India

Section 27 of Indian contract act 1872 regulates contracts.

Termination of job if work is not done properly.

Agreements under which anyone is restrained from exercising a law full profession and business is void.

Compensation rates and rules for the job are stated in contracts.

Employment Contracts in Mexico Protection of employee contracts under federal

labor law.

Severance pay if terminated without cause.

Union contracts are reviewed every two years.

Article 46 of Mexican federal labor law details the reasons for termination.

Employment Contracts in Brazil Most common employment contract is “Contrato

de Trabalho”.

Contract ensures right to 30 days of paid vacation.

Every contract has the Fundo de Garantia de tempo de servico.

Termination reasons are mentioned in the contracts.

Labor force and standards in India Two-third of work force employed in agriculture and

rural industries.

9% works in organized sector and 91% in unorganized sector.

Estimated labor force 500 million.

Trade union act 1926 prohibits discrimination against union members and employees.

Child labor act 1986 details child labor rules.

Labor force and standards in Mexico 13.7% labor force in agriculture, 23.4% in

industry an 62.9% in services.

Estimated labor force 46.99 million.

Labor work force annual growth rate 2.4%.

Forced labor and child labor prevalent in Mexico.

Labor force and standards in Brazil 103.6 million labor force (2010 estimate).

66% in services, 20% in agriculture and 14% in industry.

Forced labor, child labor, child prostitution and discrimination strictly against law.

Employment Relationships in India New trend of participation of workers in the

management.

The Industrial disputes act regulates employment relationships.

Managerial and market relationships exist between employee, employer and government.

Employment Relationships in Mexico Article 4 of Mexican constitution provides that men

and women are equal under employment relationships.

Protection of employees by the government for foreign work.

No time length on work relationships unless defined.

Article 20 of Mexican federal labor law details the rules for employment relationships.

Employment Relationships in Brazil No need of formal written employment

agreement under Brazilian labor law.

Oral employment agreements are fully valid and enforceable.

Employment relationships are regulated by CLT.

Labor card (social card) is compulsory for registration.

Wages and salary scale in India

In India the Minimum Wages Act, 1948 provides for fixation and enforcement of minimum wages.

W.E.F April 1,2011, wages have been raised to Rs. 115 per day.

Wages and salary scale in Mexico In Mexico National Minimum Wage Commission

fixes and enforces minimum wages.

W.E.F January 1, 2010, wages have been raised to 56.3 pesos per day.

Wages and salary scale in Brazil In Brazil, Consolidation of Labor Laws

(C.L.T.) fixes and enforces minimum wages.

W.E.F February 1, 2010, wages have been raised to R$ 545 per month (which corresponds to R$18.7 per day and R$2.48 per hour).

Paid time offs benefits in India 15 working days of leave per year for first 2 years

which increases to 20 working days from 3rd year.

Short term medical leave up to a maximum of 10 days and long term leave up to a maximum of 30 days.

Observes 12 paid public festival holidays per year.

Paid time offs benefits in Mexico 6 days of paid vacation per year for an employee

with at least one year of service which increases by 2 days for each year of service.

Employees working on holidays are paid double.

25 % of premium above regular pay is paid to employees whose work shift falls on Sunday known as “Sunday Premium”.

Paid time offs benefits in Brazil 34 days of paid vacation to every employee.

Every employees is entitled to 13th salary which is often called “Chritsmas Bonus”.

Employee who has not been absent from work during the period of one year is given 30 calendar days vacation.

Protection Benefits in India

Free medical care for employee (sometimes extending for the family or children).

Interest free loans (or lower than the market loans).

Child care under which child care expenses are covered by the employers.

Dearness Allowance (DA)

Protection Benefits in Mexico Specific bonus called “Aguinaldo” which is an

annual bonus that has to be paid by December 20th of each year.

Social Security Benefits under which the system is managed by the Mexican Social Security Institute.

Employers provide the equivalent of approximately 28% of the employee’s salary into several government managed funds that provide social security benefits.

Protection Benefits in Mexico cont.. Retirement Savings Plans

Medical insurance

Life insurance

Health insurance benefits

Workers Compensation plan

Protection Benefits in Brazil

Work accident insurance.

Unemployment Guarantee Fund (FGTS).

The National Unemployment Insurance Program.

The federal wage supplement

Over all Analysis

India is an agricultural based economy whereas Brazil and Mexico economies are dominated by the service sector .

India has the second largest labour force in the world around 500 million, Brazil at 103.6 million and Mexico at 46.99 million labour force.

In Brazil minimum wage is $9/day, in Mexico it is $4.05/day and $3/day in India.

Over all it is quite clear that compensation structure in these 3 countries is different from each other in all the aspects that are covered.