Jaime Oscar Bustamante Miranda – Manpower Group

Illegal labor practices force staffing agencies to innovate

When someone thinks of illegal activity in Mexico, drug cartels usually come to mind. But for Jaime Oscar Bustamante Miranda, it’s the many illegal practices in the labor subcontracting industry that keep him up at night.

Jaime Oscar Bustamante Miranda – Manpower Group

Jaime Oscar Bustamante Miranda | Legal Director for Mexico and Central America

Bustamante is the legal director for Mexico and Central America at Manpower Group, the third-largest staffing firm in the world. He declined to name specific projects he’s working on—citing confidentiality concerns—but he’s following legislative changes and a possible reform of other labor laws. He says a new regulation may bring a return to compliance within the industry.

In his role, Bustamante is responsible for legal matters for nine countriesincluding contracts, compliance with authorities and labor obligations with employees. Manpower is an employment agency, and much of its business is in Mexico and Latin America, where the employment market is flourishing, Bustamante says.

Fighting lawbreakers and working with lawmakers

The new legal provisions included in projects to reform the Mexican Labor Law, aim to balance the compensation of subcontracted employees with those hired directly, which means greater equity in remuneration for working in the same job or in similar conditions. It also prohibits illegal outsourcing practices, in which workers are registered with legal minimum wages to avoid paying higher social security contributions, paying wages divided through different schemes, and other ways of cheating to avoid obligations.

Jaime Oscar Bustamante Miranda – Manpower Group

The law also forbids hiring people under non-employment contracts like freelancers or other forms of employment designed to reduce employee benefits or avoid paying Social Security fees.

“The companies that contract illegal services are denying legal rights to their workers and causing them to receive lower retirement benefits in the future by not paying into Social Security now,” Bustamante says.

Lack of competent authorities to combat these illicit labor practices caused the majority of the problems, he explains, and there were instances of federal and local government agencies that hired outsourcing companies that did not comply with legal regulations. Bustamante explains that the new regulation should eliminate illegal practices and level what has been an unequal playing field for companies like Manpower, which he says works in full compliance with the law.

Jaime Oscar Bustamante Miranda – Manpower Group

“It’s imperative that authorities be much more effective in their responsibility to inspect and sanction these companies that use illegal outsourcing practices,” Bustamante says.

Manpower’s role in stemming illegal labor practices

In 2002, with a group of the most important companies in the international and national outsourcing market, Manpower founded an association whose main objective is to certify that all its members comply fully with all the legal obligations of any employer in Mexico, Bustamante notes. These obligations are mainly to use employment contracts that meet the standards of law and pay full Social Security and tax contributions.

A strict certification process was designed to ensure that members’ legal, financial and labor compliance backgrounds were regularly reviewed. Now, a company has its compliance function audited every two years in order to maintain full membership in the association.

For the past 15 years, Bustamante has been president of the Legal and Government Affairs Committee of the organization—called Asociacion Mexicana de Capital Humano (AMECH)—and he constantly works with all administrative, judicial and legislative authorities to seek effective and forceful measures to combat illegal outsourcing.

Jaime Oscar Bustamante Miranda – Manpower Group

“This has not been easy, and I’ve spent many times in sessions in front of the Mexican Senate and Chamber of Deputies to propose effective measures to regulate our industry,” Bustamante says.

The country’s Federal Labor Law provides the framework for protecting workers and providing them with minimum rights. It establishes the principles for employment stability, a living wage, the right to receive compensation for unjustified dismissal and freedom to unionize. Despite the presence of the laws, Bustamante says it’s been a challenge because each regulation has limits.

“There’s little flexibility to meet the needs of the globalized labor market, but with creativity and legal innovation we have successfully achieved this,” he says.

Staffing and employment during a global pandemic

The COVID-19 pandemic has caused significant disruption to Manpower’s operations in Mexico and other Latin American countries, Bustamante says. The usual workday is splintered; face-to-face contact between executives and managers is gone; and there’s a new approach to meeting with clients and employees—via Zoom meetings and other digital platforms—that have taken time adapting to.

“The activity of the courts that resolve legal issues has been stopped, and ongoing matters of importance have not proceeded,” Bustamante says.

Jaime Oscar Bustamante Miranda – Manpower Group

Still, he says the health crisis has been a watershed moment in the world of staffing and employment. There have been enormous challenges transitioning to a work-from-home environment, but Bustamante says Manpower has struck new legal agreements with workers and unions to help maintain continuity. To return to work, he says Manpower will take preventative measures including sanitation protocols, temperature checks, social distancing and keeping meetings held remotely.

“We need to make sure job sources and employment stays active, and we lose the least amount of jobs possible,” he says.

Bustamante has been at Manpower for nearly 18 years after previous stops at Marquez and Associates and Citibanamex. He graduated from Universidad La Salle in Mexico City and got his law degree from the Universidad Nacional Autónoma de México. Bustamante started his legal career as an intern for a firm involved in civil matters and then worked in the firm’s labor law practice. He´s currently pursuing a Master of Laws from the Universidad Panamericana.

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Summer I 2024



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