Mexico Supreme Court upholds Pension Fund for Wellbeing

Supreme Court of Justice of the Nation Pension Fund for Wellbeing Afore retirement accounts constitutional ruling pension reform

The Supreme Court of Justice of the Nation (SCJN) has unanimously upheld the constitutionality of the Pension Fund for Wellbeing (FPB). The ruling addresses an unconstitutionality action filed by opposition lawmakers regarding the 2024 reform that allows the transfer of inactive resources from Afore retirement accounts to the FPB.

The Court determined that transferring funds from sub-accounts for retirement, old-age unemployment, and seniority does not constitute confiscation or expropriation. The justices clarified that workers and their beneficiaries maintain ownership of these savings and can claim them at any time without a statute of limitations. The transfer is viewed as a change in administration rather than a loss of property rights.

The reform targets inactive accounts belonging to individuals who have reached age 70 for IMSS workers and age 75 for ISSSTE workers. The objective is to use these resources to strengthen the pension system and help retirees achieve a monthly income closer to the average IMSS contribution salary. The Court noted that the mechanism serves a principle of social solidarity to improve the pension system for workers.