Ecuador

• New Year’s Day
• New Year Holiday
• Carnival
• Good Friday
• Labour Day
• Anniversary of the Battle of Pichincha
• National Day
• Independence of Guayaquil
• All Souls’ Day
• Independence of Cuenca
• Christmas Day

Working Hours

Employees can work up to 8 hours a day, or 40 hours per week.

Minimum Wage

USD 450 per month.

Employee Tax

Annual income	Tax rate
Up to USD 11,310	0%
USD 11,310.01 - 14,416	5%
USD 14,416.01 - 18,018	10%
USD 18,018.01 - 21,630	12%
USD 31,630.01 - 41,630	20%
USD 41,630.01 - 51,630	25%
USD 51,630.01 - 61,630	30%
USD 61,630.01 - 100,000	35%
More than 100,000	37%
Social security contribution	9.45%

Bonuses

Employees in Ecuador are entitled to a 13th and 14th month salary, payable in December and March/September (depending on location) respectively.

The employee is also entitled to a bonus equivalent to 25% of their monthly salary for each year of service if they resign.

Employment contracts in Ecuador must be written. They should include:

• Employer and employee information
• Job title and responsibilities
• Working hours
• Salary
• Work start date
• Contract type
• Probation period

Fixed-term contracts are not usually permitted in Ecuador.

Annual Leave

Minimum of 15 days' paid holiday, with an additional day added each year after five years of service.

Sick Leave

Up to one year of sick leave.

Where employees are not covered by social security, the employer must pay 50% of the employee’s salary for two months within the year.

Parental Leave

• Maternity leave: at least 12 weeks' paid leave.
• Paternity leave: 10 days' paid leave.

Termination Process

Employers in Ecuador can terminate a contract provided they give compensation in line with legal requirements. Grounds for termination include:

• Lack of discipline
• Dishonesty
• Serious offences against the employer
• Serious incompetence
• Non-compliance with company regulations

Notice periods do not exist in Ecuador. Terminating a contract for any reason will incur severance and indemnity pay.

Severance Pay

Employees with at least 3 years’ service are entitled to three months’ wages plus an indemnity equal to 25% of the last monthly salary per year worked. If they have more than 3 years’ service they are entitled to one wage per year of service, plus the indemnity.

Under a Mauve Group Employer of Record solution, clients and workers can reap the benefits of Mauve’s Global Master Insurance Programme – a market-leading unified corporate insurance programme that connects all Mauve entities to its two preferred providers.

The insurance provides coverage in overseas locations through a combination of the master policy and its linked local policies, where required by law in certain jurisdictions. The policies include:

• Employer’s Liability and Public Liability - £10,000,000 combined limit.
• Professional Indemnity - £5,000,000 limit.
• Worker’s Compensation – Limit is dependent on location of work.

For specific information about statutory and recommended insurances in your chosen country, get in touch with Mauve.