Employer of record services in Ecuador

Yes. We manage IESS (Instituto Ecuatoriano de Seguridad Social) contributions, roughly 11.15% of gross salary from the employer, along with income tax withholding. We also calculate Ecuador’s two mandatory bonuses: the 13th salary (a Christmas bonus, one month’s average salary) and the 14th salary (a back-to-school bonus tied to the regional school calendar), both of which are legally required, not discretionary.

Beyond the mandatory 13th and 14th salaries, competitive Ecuadorian employers add private health insurance, meal allowances, and life insurance. Ecuador’s dollarized economy also means compensation benchmarking tends to be more straightforward than in countries managing currency volatility.

Ecuador’s labor code does not generally require advance notice for indefinite contract terminations, but unjustified dismissal triggers an indemnification payment calculated by length of service. Ecuadorian labor law leans protective of employees, so documenting the grounds for any termination carefully is important to managing cost and risk.

An EOR can typically onboard within one to two weeks for IESS registration, compared with the several weeks needed to incorporate an Ecuadorian entity and register with the Servicio de Rentas Internas and IESS.

Ecuador’s dual mandatory bonus system (13th and 14th salaries) and its indemnification-based termination framework require local expertise to manage accurately. An EOR takes on that compliance and the associated liability, which is typically the practical route for accessing Ecuador’s growing outsourcing talent pool.