Ecuador

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Congratulations on your decision to hire employees in Ecuador! Ecuador is known for its affordable labor costs and for having a diverse workforce with expertise in various industries, including agriculture, oil and gas, and tourism. Plane makes the hiring process easy for you by providing automated tax document collection, payroll, benefits, and more. This ensures compliance and efficiency throughout the process. Navigating how to hire in a new country can be challenging, so we've compiled the details below to help guide you.

Currency

USD

 Onboarding

2.5 weeks minimum

Employer Cost

14.15%

Pay Frequency

Monthly

Public Holidays

10

4 Considerations Before Hiring in Ecuador

As an employer in Ecuador, it is important to have a comprehensive employment contract outlining the employment relationship's terms and conditions. The contract should include compensation, benefits, vacation time, and sick leave policies. Before onboarding a new employee in Ecuador, take a moment to consider the following questions:

Minimum Wage

In Ecuador, the minimum wage has been established by the government as a base rate of $470 per month, which does not include social benefits, in addition to a 13th and 14th salary. Employers also pay 15% of their net profits up to a maximum amount as a bonus.

The "13th salary" is an additional monthly bonus that's calculated based on one-twelfth of the employee's total annual earnings, proportionally distributed over the year. This bonus can be paid once a year, but if provided, it must be paid by December 22nd. The "14th salary" is equal to the government's monthly minimum wage and is payable in March or August depending on the location of the workplace.

Minimum Wage

In Ecuador, the minimum wage has been established by the government as a base rate of $470 per month, which does not include social benefits, in addition to a 13th and 14th salary. Employers also pay 15% of their net profits up to a maximum amount as a bonus.

The "13th salary" is an additional monthly bonus that's calculated based on one-twelfth of the employee's total annual earnings, proportionally distributed over the year. This bonus can be paid once a year, but if provided, it must be paid by December 22nd. The "14th salary" is equal to the government's monthly minimum wage and is payable in March or August depending on the location of the workplace.

Will there be a probationary period? If so, for how long?
Will there be a probationary period? If so, for how long?
Do you want to offer private supplemental health insurance?
Do you want to offer private supplemental health insurance?
Would you like to offer additional incentives?
Would you like to offer additional incentives?

Getting Started with Hiring in Ecuador

Employment Contract

It is advisable to have written employment contracts in Ecuador that specify the terms and conditions of employment, including the employer and employee, place of employment, job duties, salary and payment schedule, vacation and other benefits, and any agreed-upon probation period or other terms.

The Ecuadorian government ended the possibility of entering fixed-term contracts. There is a possibility of entering “temporary contracts” in circumstances such as for maternity leave, sick leave cover, or circumstances where the employer can demonstrate the need to employ someone temporarily. A temporary contract may only last 180 days within a 365-day period.

Getting Started with Hiring in Ecuador

Employment Contract

Pay Frequency: Employee payroll is monthly. Employees receive their pay via direct deposit by the last working day of the month.

Payroll Change Cutoff Dates: To meet payroll deadlines, any changes must be submitted to support@plane.com by the cutoff date.

Plane sends payroll summaries to admins at the end of the second week of the month. After that, charges are automatically debited. Payroll summaries are also available to admins in their Pilot accounts. Payday may vary based on country requirements.

Hire Calculator

Get an instant, free estimate of how much it will cost to employ your next hire, including taxes.

Once you have sorted out the details mentioned above, you can add the employee to the Plane platform. We provide a step-by-step workflow that shows what tasks need to be completed, as well as real-time updates and notifications. This way, you can stay on top of the hiring process at all times. With Plane, you can confidently hire, knowing that you have a powerful platform at your disposal to manage the entire process from start to finish. Here are the instructions for adding a new employee to the platform:

How to hire and onboard an employee

Plane offers a guided process for administrators and managers to hire and onboard their new employees.

Hiring an employee in a new country can be a complex process, but with the right guidance and resources, it can be a smooth and successful transition. At Plane, we're committed to helping you navigate this process step-by-step. We'll keep you informed and up-to-date with the latest regulations and employment laws.

Frequently Asked Questions

Here are answers to some common questions about hiring employees outside of the US with Plane:

What is the relationship between my company and Plane?

Pilot Platform Inc (Plane) provides the product and service by helping you manage HR, payroll, and statutory requirements. Plane has its own entities and partners that are the EOR/legal employer where the employee is legally hired in the country. Plane and our partner do not manage the performance of the employees since we do not monitor or work directly with them.

What is the relationship between my company and Plane?

Pilot Platform Inc (Plane) provides the product and service by helping you manage HR, payroll, and statutory requirements. Plane has its own entities and partners that are the EOR/legal employer where the employee is legally hired in the country. Plane and our partner do not manage the performance of the employees since we do not monitor or work directly with them.

Can Plane withhold taxes for non-cash compensation (e.g. stocks, options)?
Can Plane withhold taxes for non-cash compensation (e.g. stocks, options)?
Will I be able to pay a bonus, commission, or any other additional payments?
Will I be able to pay a bonus, commission, or any other additional payments?
Can Plane guarantee the employee’s start date?
Can Plane guarantee the employee’s start date?