To curb abusive labor practices such as sudden company shutdowns, repeated wage theft, and workplace harassment, Baja California lawmaker Michel Sánchez Allende has introduced a bill to reform the state’s Penal Code.
The proposal targets what are commonly known as “fly-by-night companies,” businesses that abruptly cease operations and leave workers without pay, severance, or legal recourse. According to Sánchez Allende, these practices have left hundreds of families across the state in financial distress.
Speaking at a press conference at the state legislature, the Morena lawmaker said the initiative seeks to classify certain employer abuses as criminal offenses, applicable to both individuals and corporations. The goal, she explained, is to protect workers whose livelihoods are suddenly cut off when companies disappear or evade their responsibilities.
“Workers cannot continue paying the price when a company vanishes overnight,” Sánchez Allende said. “Decent work and fair wages are rights, not favors.”
Clear criminal penalties
The bill proposes the creation of a new chapter in the state Penal Code titled “Crimes Against Labor and Social Welfare,” establishing clear criminal penalties for employers who intentionally violate labor obligations.
Among the offenses outlined are wage-related violations, including delayed salary payments of more than 20 days, unlawful withholding of wages, and failure to distribute profit sharing as required by law. These violations would carry prison sentences ranging from three months to two years.
The initiative, informally known among workers as the “Anti Fly-by-Night Law,” also seeks to punish companies that shut down operations, relocate, or block access to workplaces without paying outstanding wages, benefits, or severance.
Penalties for deliberate business abandonment
For these forms of deliberate business abandonment, the proposal establishes prison sentences of one to six years.
This practice has been widely reported by workers in the state but is currently addressed only through labor courts, which limits the possibility of meaningful penalties. The reform aims to move these cases into the criminal sphere.
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The bill also includes the criminalization of workplace harassment, setting prison terms of six months to three years for individuals who engage in physical, verbal, or psychological abuse intended to humiliate, intimidate, or harass workers in their place of employment.
Twenty-five fly-by-night companies identified
Sánchez Allende noted that between 2023 and 2025, authorities identified 25 companies that closed their doors without notice, leaving employees without compensation, unpaid wages, seniority benefits, year-end bonuses, vacation pay, vacation premiums, or profit sharing.
The proposal was developed through an extensive consultation process, including the public forum “Wellbeing and Justice for All Workers,” held in October 2024. The forum brought together members of the public, judicial authorities, business groups, legal professionals, academic institutions, and civil society organizations.
Additional consultations were held with the Ministry of Labor and Social Welfare, the State Attorney General’s Office, the State Human Rights Commission, and the judiciary to strengthen the bill from both a technical and institutional standpoint.
