Remote’s guide to employing in

Ecuador
ecuador flag

Make employment in Ecuador easy. Let us handle payroll, benefits, taxes, compliance, and even stock options for your team in Ecuador, all in one easy-to-use platform.

  • Capital City

    Quito

  • Currency

    United States Dollar ($, USD)

  • Languages

    Spanish

  • Population size

    17,300,000

Services available in this country:
Employer of Record ProductContractor Management

Facts & Stats

Ecuador Map Illustration
  • Capital City

    Quito

  • Currency

    United States Dollar ($, USD)

  • Languages

    Spanish

  • Population size

    17,300,000

  • Ease of doing business

    Medium

  • Cost of living index

    $$ (90 of 139 nations)

  • Payroll frequency

    Bimonthly/Monthly

  • VAT - standard rate

    12% (0% on imported supplies)

  • GDP - real growth rate

    0.1%

The Republic of Ecuador (República del Ecuador) is a sovereign democracy that boasts an increasing GDP powered by commodities like petroleum and agricultural products.

The country has seen a decline in poverty and Ecuador now hosts a competitive labour market for businesses looking to expand into South America and attract Spanish-speaking talent.

Grow your team in Ecuador with Remote

Looking to employ workers in Ecuador? Companies hiring in Ecuador must either own a legal entity in the country or work with a global employment solutions provider, usually one that provides employer of record services.

Remote can employ your team in Ecuador on your behalf through our local legal entity in the country and handle payroll, benefits, taxes, and compliance for your Ecuador team. You can also pay contractors now in Ecuador with Remote in some currencies (talk to an expert now for full details).

Risks of misclassification

Ecuador, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Ecuador may lead to fines and penalties for the offending company.

Employing in Ecuador

The Ecuadorian Constitution and Labour Code spells out provisions for employee protections and workers’ rights at the federal level, applying to Ecuador’s workforce of 4.2 million. Employees in Ecuador enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.

Common questions that could come up during the hiring process include minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Ecuador.

Minimum Wage

The Ecuadorian government has set the minimum wage at:

  • $400 per month base rate, excluding social benefits, plus a 13th and 14th salary, or

  • $466.66 per month, factoring in mandatory 13th and 14th salaries prorated over the year

Payroll Cycle

For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.

13th salary

Ecuador’s ‘13th salary’ consists of an additional monthly bonus equivalent to the proportional monthly part of one twelfth of everything received by the employee in the year. This payment can be paid once a year, but if offered it must be paid by December 22nd.

14th salary

Ecuador’s 14th salary is equal to the government monthly minimum wage ($400 for 2020) and is payable in March or August depending on the location of the workplace. The employee can request to receive it in an accumulated manner, in which case it must be paid before March 15 in the Coastal and Insular regions, and until August 15 in the Highlands and Amazon regions.

Onboarding Time

We can help you get a new employee started in Ecuador fast. The minimum onboarding time we need is only 5 working days.

Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.

For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.

Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.

11 Public holidays

Jan
Monday, January 1, 20241New Year's Day (Año Nuevo)
Feb
Monday, February 12, 20242Shrove Monday (Lunes de carnaval)
Tuesday, February 13, 20243Shrove Tuesday (martes de carnaval)
Mar
Friday, March 29, 20244Good Friday (Viernes Santo)
May
Friday, May 3, 20245Labour Day (Día del Trabajador, observed day)
Friday, May 24, 20246The Battle of Pichincha (La batalla de Pichincha)
Aug
Friday, August 9, 20247Independence Day (Día de la Independencia, observed day)
Oct
Friday, October 11, 20248Independence of Guayaquil (Independencia de Guayaquil, observed day)
Nov
Friday, November 1, 20249All Souls' Day (Todo el día de almas, observed day)
Monday, November 4, 202410Independence of Cuenca (Independencia de Cuenca, observed day)
Dec
Wednesday, December 25, 202411Christmas Day (Navidad)

Competitive benefits package in Ecuador

At Remote, we’re obsessed with helping you craft the best possible employee experience for your team. We are leading the way in practising “fair equity,” which means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive (and that will allow you to attract the best local talent).

Our benefits packages in Ecuador are tailored to fulfil the local needs of your employees. Typically, our packages contain some or all of the following benefits:

  • Health Insurance

  • Dental Insurance

  • Vision Insurance

  • Mental Health Support

  • Pension or 401(K)

  • Life and Disability Insurance

Taxes in Ecuador

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Ecuador.

  • 12.15%

    Social Security

Types of leave

Employees are entitled to 15 days of continuous annual leave, including weekends (i.e. 11 working days + 4 weekend days).

Employment termination

Termination process

Employee contracts can be terminated if a reasonable just cause is established, such as dishonesty, negligence, fraud, or any other work-related offences. That aside, notice should be provided in advance – provided both parties agree to it.

Notice period

There is no notice stipulated notice period and employers are only required to adhere to whatever agreement spelled out in the employment contract.

Severance pay

Without the appropriate termination notice, employees are entitled to receive a severance package equivalent to one month’s salary multiplied by the number of years the worker has stayed with the employer, up to 25 years.

Probation periods

A probationary period can be defined upon hiring an employee, up to a maximum of 90 days.

Fair Pricing in Ecuador

Employer of Record

Hire and pay your global team

Starting at US$599/month

Top features

  • Satisfaction guaranteed

  • No deposits or hidden fees

  • Zero onboarding or offboarding fees

  • Compliant equity incentives support including withholding and reporting

  • Built-in security and compliance

  • Fast onboarding (average 2-3 days)

  • Flexible, localised benefits

Contractor Management

Compliantly onboard and pay contractors

US$29

per contractor/month

Start free trial

Top features

  • Only pay for contractors you actively work with

  • Work with contractors in 200+ countries

  • Create, edit, and sign tailored, localised contracts

  • Approve contractor invoices with one click or auto-pay

  • Transparent payments with complete visibility

Global Payroll

Consolidate your multi-country payroll

US$50

per employee/month

Top features

  • Reduce costs by centralising payroll management

  • Ensure local compliance for every country

  • Direct support from in-house local payroll experts

  • Accurate, on-time, compliant payroll to level-up your employee experience

  • Tax and labour authority reporting handled for you

HRIS

Manage all of your employees in one place

Free
Sign up

Top features

  • Guided onboarding and offboarding

  • Employee profile and document management

  • Time and attendance (time off and tracking)

  • Expense management and reimbursement

  • Employee self-serve on the platform and mobile app