By Cristina Guarderas B
Head of the Labor Department
We are pleased to share relevant information about the reduction of the working hours in the tourism sector, in alignment with article 47.1 of the Labor Code. The Ministerial Agreement No. MDT-2024-030 introduces this new guideline and has been published in the Official Register No. 518 since March 14, 2024.
Highlights of the Regulation
Scope
It applies to employers in the tourism sector with a Tourism Registry, operating under the Labor Code regime.
Reduction of Working Hours
Authorized by the Ministry of Labor for up to 6 months, renewable, with a minimum of 30 weekly hours, with the possibility of extending for another 6 months, either continuously or in two phases.
Justification for the Reduction
The reduction proceeds in circumstances of force majeure, decrease in income, or verification of losses.
Application Process
To request a reduction in working hours, employers must present to the Ministry of Labor: a formal petition, an agreement between the parties, an austerity plan, a list of affected employees, a copy of the Single Taxpayer Registry, certification of compliance with the IESS (Ecuadorian Social Security Institute), and certification of the Tourism Registry. The austerity plan must include a reduction in income for the company's directors or administrators as part of the commitment to apply this measure.
Compensation and Benefits
The remuneration will be adjusted proportionally to the hours worked, with social security contributions based on 8 daily hours.
Severance Payments
In the event of dismissal, they will be calculated based on the last salary before the reduction of working hours.
Additional Information
Need more information or personalized advice on how this new regulation could affect your business in the tourism sector? Our team of labor law experts is ready to offer you the guidance and support you need. Do not hesitate to contact us.
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