Labor Law

The workday establishes the time an employee must dedicate to their duties and is classified into four types:

1. Maximum Workday: 8 hours daily, up to 40 hours weekly, distributed over 5 days. Applicable in most cases.
2. Extended Workday: Agreements to work more than 8 hours daily, not exceeding 10 hours per day or 40 hours weekly. Corresponding surcharges must be paid.
3. Reduced Workday: In special cases, the workday can be reduced to a maximum of 30 hours weekly, with the authorization of the Ministry of Labor, maintaining contributions to the IESS.
4. Recovery Workday: To recover lost hours due to external causes, the workday can be extended up to 3 additional hours daily, with authorization from the Ministry of Labor and without extra surcharges.

These classifications ensure flexibility and compliance with labor regulations for both employees and employers.

The Internal Work Regulation is essential in Ecuador because it sets clear rules for employees and employers, helping to prevent conflicts. This set of rules regulates labor relations and is mandatory for companies with more than 10 employees, while optional for those with fewer.

Without this regulation, fines cannot be imposed on workers, nor can certain grounds for dismissal be invoked before the labor inspector. Having an internal regulation is always recommended to ensure a fair and organized work environment, providing clarity and security for both parties.

In Ecuador, the employer has several economic obligations according to labor law. The main ones are detailed below:

1. Annual Vacations: The worker is entitled to 15 uninterrupted days of vacation per year. After 5 years of service, an extra day is added for each additional year. The vacation schedule must be communicated to the worker at least 3 months in advance.
2. Profit Sharing: The employer must distribute 15% of the company's net profits. 10% is distributed among all workers, and 5% in proportion to their family responsibilities.
3. Additional Remunerations:
   • Thirteenth Salary (Christmas Bonus): Proportional to one-twelfth of the annual earnings, paid monthly.
   • Fourteenth Salary (School Bonus): Equivalent to one-twelfth of a Unified Basic Salary, paid according to the regional school calendar.
4. Reserve Fund: After one year of service, the worker is entitled to an additional annual salary, paid proportionally monthly.
5. Employer's Retirement: After 25 years of continuous service with the same employer, the worker is entitled to the employer's retirement. The calculation includes the reserve fund, 5% of the average annual salary of the last 5 years, multiplied by the years of service, minus the IESS payment.

A sudden dismissal can be particularly serious for a pregnant woman. In such cases, you should file a claim with the Labor Judge to declare the dismissal ineffective and reinstate you to your job, under the principle of immobility.

The action for ineffective dismissal aims to ensure your continued employment. This action does not seek compensation but prevents the dismissal from taking effect. However, if you decide not to return to your job, the judge will order the payment of the compensation provided by the Labor Code, in addition to the amount for sudden dismissal.

If you have worked for more than 25 years for the same employer and wish to retire, consider the following:

1. Employer's Retirement: This right can be granted through a retirement pension or a global retirement fund.
2. Global Retirement Fund: To opt for a global retirement fund, there must be a written agreement between the employer and the worker, signed before a competent authority.
3. Voluntary Retirement Bonus: It is important to note that a voluntary retirement bonus is not the same as the global employer retirement fund.

Make sure you have all the documentation in order and have reached a clear agreement with your employer to guarantee your rights at the time of retirement.

If you do not receive your salary on time, first talk to your employer to resolve the issue amicably. If it is not resolved, you can file a complaint with the Ministry of Labor or consider legal action to ensure your rights.

In case of a work accident, you are entitled to immediate medical attention and compensation for any temporary or permanent disability. It is important to report the accident to your employer and the Ecuadorian Social Security Institute (IESS) as soon as possible.

If you experience workplace harassment, document all incidents and report them to your employer or the human resources department. If no action is taken, you can file a complaint with the Ministry of Labor or seek legal advice to protect your rights.

The employer must provide a safe and healthy work environment, complying with occupational safety and health regulations. This includes implementing preventive measures, training employees, and providing adequate protective equipment.

At the end of a labor contract, you are entitled to receive a settlement that includes payment for pending wages, unused vacation, bonuses, and any other compensation according to the law. It is important to review your contract and the current legislation to ensure you receive everything you are entitled to.

A labor contract should include the job description, working hours, salary, benefits, contract duration, and the obligations and rights of both the employee and the employer. It is also recommended to specify company policies and any other relevant conditions.

To carry out a justified dismissal, you must have a valid and documented reason, such as failure to fulfill labor obligations or misconduct. It is important to follow the legal process, including notifying the worker and giving them the opportunity to defend themselves before proceeding with the dismissal.

As an employer, you are obliged to provide a safe and healthy work environment. This includes implementing safety measures, training employees in safe practices, and providing personal protective equipment. You must also comply with occupational safety and health regulations established by the Ministry of Labor.