If you hire staff abroad, one of the necessary steps is to register for the local social security program and pay legal contributions. Some employers may be confused by the fact that their foreign workers can still pay for social insurance at home to maintain their pension and health benefits. But local labour laws still need to be followed for both residents and expatriate employees. If you have participated in both Canada`s pension plan and the Mexican pension program, or if you have lived in Canada and Mexico, this agreement can help you qualify: if you are a widow, widower or child of a person who has contributed to the pensions of both countries, this agreement can help you identify yourself for: Mexican workers are covered by the Social Security Act, according to IMSS, which is responsible for managing social security benefits and forfeiture of contributions. An agreement with Mexico would save U.S. workers and their employers about $140 million in social security and health insurance taxes in Mexico during the first five years of the agreement. The Social Security Administration has 24 totalization agreements – most with other industrialized countries such as Canada and Japan. The agreements help workers who share their careers between the United States and their home countries. Workers may not be entitled to social security benefits from one or both countries because they have not worked long enough in one country or because they have not worked long enough to meet the minimum eligibility requirements.
These international social security agreements are called „totalization agreements“ and have two main objectives: the abolition of double taxation of social security, which arises when a worker from one country works in another country and has to pay social security contributions to the two countries with the same incomes. As a result of existing totalization agreements, U.S. workers and employers are currently saving about $800 million a year in foreign taxes that they do not have to pay. In the United States, after the signing of the agreement, the President will submit the agreement to Congress, where it will have to be reviewed for 60 days of session. If Congress does nothing during this period, the agreement can move forward. For more information on these totalization agreements, see www.socialsecurity.gov/international/. Since 2005, TSCL has requested the disclosure of documents relating to the agreement through several requests and appeals by the Freedom of Information Act (FOIA). As a result, the first public copy of the 2006 totalization agreement was published to TSCL, but there were no long-term estimates of the financial impact contained in the disclosed documents.
Determined to know what the government usually accepts, TSCL filed more FOIA applications and another complaint. Recently, a new federal judge ruled that TSCL deserves more information. TSCL expects that additional documents will be published as soon as possible, unless the government appeals. Since the late 1970s, the United States has concluded international social security agreements that the United States coordinates.