Reform seeks to substitute employer’s retirement for a single payment

Labor Relations Minister, Francisco Vacas, said yesterday during his presentation of the Draft for the Organic Code of Labor Relations that the employer’s retirement, which is a benefit that grants a pension to a worker who turned 25 of continuous or discontinuous work in the same company, aims to be replaced by a single bonus payment.

Francisco Vacas during his presentation at the Hotel Sheraton in Guayaquil.

Vacas recalled that “the employer’s retirement was created (…) to replace the general retirement, over issues from the Social Security of not being able to fulfill the general retirement, but it remained”. Then he pondered, “there is a double retirement: General and employer’s retirement.”

“The intention (of the project) is to create a single payment for termination based on the years of work,” said Vacas, “is to replace both the payment of the monthly retirement pension and the layoff bonus for a completition bonus. So, if a person worked 5, 10, 15, 20, 30 years or 7 years, receives a payment that is a percentage of their last salary, “he added. This percentage, he said, is still under review.

The ministry also raised the possibility that the worker present termination of employment through the website of the Ministry. “(…) You no longer have to do the process (…), but the layoff is done directly.” “If before the worker had to labor up to 15 days after the termination, now that time could be reduced up to five days.