On July 15th, the Ministry of Labor (hereinafter “MdT”) through Ministerial Agreements MDT-2020-132 and MDT-2020-133, issued guidelines for the establishment of the new labor categories contemplated in the “Organic law on humanitarian support to combat the health crisis arising from COVID-19”.
1. Preservation of labor sources agreements (MDT-2020-132 Agreement)
The employer must update in the online platform SUT – Humanitarian Law section – the employee’s information in accordance with the signed agreement, including its validity.
Agreements may be renewed once, for the same period for which they were originally entered.
Note: Agreements may be registered from July 31st, 2020. Employers who signed agreements with their workers prior to the issuance of Agreement 132, will have 15 working days to register the information in the online platform SUT, that is, until August 21st, 2020.
2. Emerging special employment agreement (Agreement MDT-2020-132)
The employer must register in the online platform SUT the information about the employee and the employment agreement, within 15 days from the beginning of the employment relationship.
Note: Employment agreements may be registered from July 31st, 2020. Employers who signed such agreements prior to the issuance of Agreement 132, will have 15 working days to register the information in the online platform SUT, that is, until August 21st, 2020.
3. Emerging working-day reduction (Agreement MDT-2020-133)
The employer may implement the emerging working-day reduction when facing situations of unforeseen circumstances or force majeure in the terms provided for in Article 30 of the Civil Code.
Conditions and characteristics
- Reduction: The employer may reduce the working hours by up to 50%, prior authorization from the Ministry of Labor.
- Term: Up to 1 year, renewable only once for an equal term. After the expiration of the term, the employee’s salary will be the same he/ she received before the measure was applied.
- Salary: It may not be less than 55% of the salary in force before the reduction and must be proportional to the hours worked.
- Contributions to IESS: Must be based on the salary paid.
- Labor benefits: The thirteenth and fourteenth remunerations, reserve fund, vacations and profits shall be paid in proportion to the working-day and the income received by the employee.
- Compensation: In case of layoff, the compensation will be calculated based on the salary received before the reduction.
- Exceptions: Employees whose working-day have been reduced under the provision of article 47.1 of the Labor Code may not have this measure applied to them while the previous reduction remains in force.
- Registration in the SUT: Update the worker’s data in accordance with the new working conditions, including their validity. The lack of registration will be sanctioned according to the Labor Code (US$200 fine), as well as the Constitutional Mandate 8, that is, fines from 3 to 20 minimum statutory wages (currently, from US$1,200 to US$8,000).
- Notification: The employer must notify the employee by any means of the implementation of the measure and its conditions.
Note: Employers who have applied the working-day reduction before the issuance of Agreement 133, will have 15 working days to register the information in the online platform SUT, that is, until August 5th, 2020.
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DISCLAIMER: The preceding text has been prepared for general information purposes only. CorralRosales is not responsible for any loss or damage caused as a result of having acted or stopped acting based on the information contained in this document. Any given situation requires the specific opinion and view of the firm in Quito / Guayaquil, Ecuador.