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CHAPTER VLabor Law1. Labor ContractsContracting is one of the most important issues in labor law, since it is from contractsthat all the rights and obligations of an employment relationship emanate, regardless ofthe form in which the relationship is established.In Mexico there are two types of labor contracts: the individual employment contractand the collective contract. The individual contract is normally between a worker and anemployer, and the interest is individual. In contrast, the collective contract is establishedcommonly between unions and employers, and it involves a group interest. Article 20 of theFederal Labor Law (Ley Federal del Trabajo, LFT) distinguishes between the concepts of individualemployment agreement and a simple labor relationship and establishes that thelabor relationship, whatever act originates it, is the provision of personal, subordinated workto a person in return for the payment of wages, while the individual employment agreement,whatever its form or name, is the agreement by which a person is obligated to provide toanother person personal, subordinated work in return for the payment of wages.However, both the individual employment agreement and the labor relationship producethe same effects, since both involve the provision of personal, subordinated servicefor the payment of a wage as a principal characteristic.731.1. Hiring of Personnel for a Limited Time Period, for a Specific Pieceof Work, or for an Indefinite Time PeriodThe most common contracts recognized by labor law are contracts for a limited timeperiod, for a specified piece of work, or for an indefinite time period. Below we willexplain the differences, the requirements, and the risks in the hiring of personnel for alimited time period, for a specific piece of work, or for an indefinite time period, as wellas how each of these contractual agreements can be terminated.