Overview

Capital
Quito
Currency
United States Dollar (USD)
Date Format
dd/mm/yyyy

Taxes

Employer
12.15% - Social Security
0.16% - Pension Fund
8.33% - Reserve Fund (after 1 year)
Employee
9.45% - Social Security
8.64% or 6.64% - Pension Fund
Up to 11,270 - 0.00%
11,270 - 14,260 - 5.00%
14,360 - 17,950 - 10.00%
21,550 - 43,100 - 15.00%
43,100 - 64,630 - 20.00%
64,630 - 86,180 - 25.00%
86,180 - 114,890 - 30.00%
Over 11,890 - 35.00%

Minimum Wage

General

Minimum wage is US$451 monthly (including 13th and 14th salary), from 1 January 2019.

Payroll

Payroll Cycle

Salaries are paid on a bi-monthly, or monthly basis on the last day of the month. Semi-monthly payment are very common, providing 40% of monthly wage in first half of the month, and remaining 60% at the end.

Working Hours

General

40 hours weekly, and 8 hours daily. * Saturday and Sunday are considered mandetoryrest days. * Work between 7pm - 6am are paid at 125%.

Overtime

Overtime is considered any hours additional to 8 in one day, or 40 in one week. It is paid at 150%, or 200% is overtime hours are after midnight.

Payroll Contributions

Social Security

Employers contribute 12.15% of the employees salary to social security. Employees contribute 9.45% of their salary to social security.

Pension Fund

Employers conrtibute 0.16% of workers wages to their pension fund, Employees contribute either 6.64% (public and private sector employees) or 8.64% (public sector). Additionally, the government provides 40% of the cost of old age, disabillity and survivor pension contributions as an employer.

13th Salary

An additional extra salary payment made as a Christmas bonus by December 22nd. The amount used to calculate includes bonuses, commission and overtime (this means it can equal more then a months salary).

14th Salary: Equal to the government minimum wage, and paid in either March or August depending on location.

Additional Benefits

Reserve Fund: After a year of service, employers contribute 8.33% of wages to this fund. Employees can choose to contribute.

Leave

Maternity Leave

New mothers are entitled to maternity leave of 12 weeks. Payment is shared by the social security and the employer. Social security pays 75%, the employer pays 25%. * 10 days are added for additional births.

Paternity Leave

New fathers are entitled to paternity leave of 10 days. * 5 additional days are added for caesarean or multiple births. * 8 additional days are added for babies who ae premature or require special care. * 25 additional days are added for sever disability, or illness.

Parental Leave

No statutory regulations.

Other Leave

Hospitalization Leave: each parents is entitled to 25 days leave if their child is hospitalized.

Medical leave (maternity): A woman may leave work for up to a year for complications from pregnancy that present an inability to work.

Termination

Termination Process

Contracts can be terminated with just cause with out severance (with approval from labor augority) for: * Lack of discipline * Dishonesty * Serious offense against the employer * Serious incompetence * Non-compliance with regulations Otherwise, 30 days notice is required.

Notice Period

There is no statutory notice period, it is decided within the contract.

Severance Pay

If employees are not given notice, they are entitled to receive one paycheck for every ear employed by the company up to 25 months of payments. Additionally, sudden dismissal bonus is offered at 25% of monthly wages for each year employed. * If employed for over 20 years, worker is entitled to retirement pension.

VAT

General

VAT is 12% standard rate.