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Finiquito vs Liquidación: What's the Difference?

In Mexico, there are two distinct payments when employment ends. The 'finiquito' (settlement) includes all earned but unpaid compensation: unpaid salary days, proportional aguinaldo (Christmas bonus), proportional vacation days, and vacation premium (prima vacacional). Every worker receives finiquito regardless of why they left — resignation, dismissal, or mutual agreement. The 'liquidación' (severance/indemnification) is ADDITIONAL compensation paid ONLY when the worker is fired without justified cause (despido injustificado). It includes: 3 months of integrated daily salary (indemnización constitucional, Art. 48 LFT), 20 days per year worked (Art. 50 LFT, in specific cases), and prima de antigüedad (12 days per year, Art. 162 LFT). The total for unjust dismissal can represent 6-15+ months of salary depending on seniority, making it crucial to calculate correctly.

How Is Each Concept Calculated?

All calculations start with the daily salary (monthly ÷ 30). For indemnification, the Salario Diario Integrado (SDI) is used — this includes the proportional value of aguinaldo and prima vacacional built into the daily rate. The SDI factor for minimum benefits (15 days aguinaldo, 25% prima vacacional on 12 vacation days) is approximately 1.0493. Unpaid days are simply the daily salary times days worked in the current period. Proportional aguinaldo is (15 ÷ 365) × days worked this year × daily salary. Vacation days are determined by seniority using the official LFT table (12 days for year 1, increasing to 20 by year 5, then +2 every 5 years). The vacation premium is 25% of vacation pay. For dismissals, the indemnification is 90 × SDI, and prima de antigüedad is 12 × years × MIN(daily salary, 2×minimum wage). ISR is calculated separately for finiquito (normal Art. 96) and indemnification (Art. 95, with 90 UMA exemption).

Frequently Asked Questions

What is the difference between finiquito and liquidación?

Finiquito is the payment of pending compensation (unpaid salary, proportional aguinaldo, vacation, prima vacacional) and is paid in ALL terminations. Liquidación is ADDITIONAL indemnification (3 months salary + 20 days/year + prima de antigüedad) paid ONLY in unjustified dismissals. You always get finiquito; you only get liquidación if you were wrongfully fired.

How long does my employer have to pay me?

The finiquito must be paid immediately upon termination or within 3 business days at most. There is no legal provision allowing longer delays. If your employer doesn't pay, contact PROFEDET at 800-911-7877 for free legal assistance.

What is the SDI (Salario Diario Integrado)?

The SDI is your daily salary plus the proportional value of your benefits (aguinaldo and prima vacacional). For minimum legal benefits (15 days aguinaldo, 25% prima on vacation), the SDI factor is approximately 1.0493. Indemnification is always calculated on SDI, not your regular daily salary.

Do I get prima de antigüedad if I resign?

Only if you worked 15 or more years at the company (Art. 162 LFT). In unjustified dismissals, prima de antigüedad is ALWAYS paid regardless of seniority. It's calculated as 12 days per year of service, capped at 2× the daily minimum wage ($630.08/day in 2026).

How many vacation days do I get by law?

Since the 2023 'Vacaciones Dignas' reform: Year 1 = 12 days, Year 2 = 14, Year 3 = 16, Year 4 = 18, Year 5 = 20. After that, +2 days every 5 years (Years 6-10 = 22, Years 11-15 = 24, etc.). The old table with 6 days for year 1 is no longer valid.

Is the finiquito taxed?

Yes, partially. Unpaid days are taxed as regular income. Aguinaldo is exempt up to 30 UMA ($3,519.30). Prima vacacional is exempt up to 15 UMA ($1,759.65). Indemnification is exempt up to 90 UMA ($10,557.90). Prima de antigüedad is exempt up to 90 UMA. Only amounts exceeding these thresholds pay ISR.

What if I think my finiquito amount is wrong?

Do NOT sign the document. Once signed, it's very difficult to claim additional amounts. Use this calculator to verify the numbers, then contact PROFEDET (800-911-7877) for free legal review. You have 1 year from termination to file a claim (Art. 516 LFT).

Does mutual agreement get the same as dismissal?

Not automatically. In mutual agreements, the terms are negotiated. Most employers offer similar to unjustified dismissal (3 months + prima de antigüedad) to avoid legal disputes. Always negotiate in writing and don't accept less than what the law provides for a dismissal.