How to hire remote employees in

Ecuador

Ecuador’s got rich culture, great food, and incredibly talented people who want to work remotely. If you’ve found someone you’d like to hire in Ecuador but aren’t sure exactly how to go about it, you’re in the right place. On this page, you’ll learn about how to hire talent in Ecuador—without spending months and thousands of dollars getting set up.

Country snapshot

CURRENCY
United States Dollar (USD)
EMPLOYER TAXES
Up to 19.48%
PAYROLL FREQUENCY
Monthly
OFFICIAL LANGUAGE
Spanish

What to know before you hire in 

Ecuador

No matter where you’re from, Ecuador’s labor laws are different from the laws in your home country (unless you’re from Ecuador, that is). Here’s the difference between hiring employees and contractors in Ecuador.

If you want to successfully hire in 

Ecuador

, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in 

Ecuador

. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Panther for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in 

Ecuador

 is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Why hire independent contractors in 

Ecuador

Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in 

Ecuador

.

It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Panther’s locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Panther, then $49 per month to hire your contractors with Panther. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

Hiring contractors in 

Ecuador

 means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

It’s less risky than hiring employees

Hiring employees is a bigger commitment, and generally puts you at a bigger risk for legal fees. When you hire contractors overseas, your biggest risk is misclassification—but even then, misclassification penalties are often minimal and just require you to pay off any compensation that the person would have been owed as an employee.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

How can I pay people in 

Ecuador

?

If you’re hiring contractors in 

Ecuador

, you can pay them with Panther in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

Hiring and paying your team in 

Ecuador

Hire and pay with Panther

Pay everyone with a single click
Get great currency conversion rates
Pay $0 in platform fees
Run payroll in seconds
Let Panther automatically create & store invoices
Let Panther automatically write locally-compliant contracts
Let Panther automatically file local tax documents

Hire and pay without Panther

Pay all your contractors individually
Do all currency conversions yourself
Shoulder the burden of platform fees
Spend hours each month making payments
Manually track & store invoices
Manually write & sign contracts
Manually file relevant tax documents

Let Panther save you from hiring headaches.

Sign up today for $0

If you want to hire employees in 

Ecuador

If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Ecuador than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Ecuador.

Taxes in 

Ecuador

Employer tax

Employer Contributions

  • Up to 19.48%

Individual tax

Leave

Paid Time Off (PTO)

Employees receive 15 days of paid leave annually. After five years of continuous service, an additional day is given per year.

Public Holidays

There are 12 public holidays.

Sick Days

Employees who have 180 days of continuous contribution to the Ecuadorean Social Security Institute (IESS) within 6 months prior to the onset of illness, or 189 days of continuous contribution within 8 months prior to the onset of illness.

Employees who are covered are paid by the employer for the first three days and covered by IESS for the remainder.  

Maternity Leave

New mothers are entitled to maternity leave of 12 weeks; 2 weeks before birth and 10 weeks after birth. 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 10 days of paternity leave, 15 days for cesarean or multiple births, or 18 days for babies who are premature or require special care. 25 additional days are added for severe disability or illness.

Parental Leave

No statutory regulations.

Other Leave

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

Marriage Leave

None.

Bereavement Leave

1 day of paid leave for the death of a 1st or 2nd-degree relative.

Termination

Termination Process

Contracts can be terminated with just cause without severance (with approval from labor authority) for Lack of discipline, dishonesty, serious offense against the employer, serious incompetence, or Non-compliance with regulations. Otherwise, 30 days notice is required.

Notice Period

There is no statutory notice period, it is usually something that is agreed upon in the employment contract.

Severance Pay

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

Probation Period

3 months.

Employee requirements in 

Ecuador

Working Hours

Employees work 5 days per week. Normal working hours are 8 hours per day and 40 hours per week.

Overtime

Regular overtime hours are paid at the rate of 150% of the regular pay. Work performed on Saturday, Sunday, or holidays are paid at a rate of 200% of the regular pay.

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