GENERAL REGULATIONS TO THE ORGANIC LAW FOR THE PROMOTION OF THE VIOLET ECONOMY

On November 20, 2023, the President of the Republic of Ecuador issued the “General Regulations of the Organic Law to Promote the Violet Economy”. The Regulation will become effective as of its publication in the Official Gazette.

Below is what you need to know about the new Regulation:

1. Equality Plan

• Every employer with 50 or more employees shall hold an Equality Plan aimed at achieving equal treatment and opportunities between women and men.
• Prior to the development of the Equality Plan, the employer shall carry out a diagnosis to identify any difficulty, disadvantage or obstacle that prevents gender equality.
• The Equality Plan will be valid for 4 years and must be registered before the Ministry of Labor.
• The Ministry of Labor will issue the practical guide for diagnoses and elaboration of the equality plans within 90 days following the effective date of the Regulation.

2. Sexual harassment in the workplace

• The Regulation incorporates the definition of sexual harassment in the workplace and establishes that it will be considered as a cause for termination of the employment relationship after the administrative process (“Visto Bueno”).
• Employers shall have a procedure to investigate any complaints of harassment, discrimination and violence against women.
• The Regulation clarifies that the term of one (1) month to notify the accused employee with the request for “Visto Bueno” shall be counted as of the date the employer had knowledge of the fact.
• Employer shall adapt their Internal Work Regulations to include sexual harassment prevention mechanisms.
• El employers shall annually train their employees on prevention of sexual harassment in the workplace.

3. Violet Seal

• The Ministry of Labor, or the institutions accredited for this purpose, may grant the Violet Seal to interested employers who meet the requirements.
• The Violet Seal is a badge that certifies equal treatment and opportunities in the workplace.
• The Violet Seal will be valid for one (1) year, renewable upon review of the requirements.

4. Sanctions

• Employers who breach the obligations of prevention, investigation, and sanction of sexual harassment at work, discrimination or gender violence, may be sanctioned with fines of up to 20 minimum statutory wages (currently US$9,000) depending on the size of the company.
  
  

Contact: Marta Villagómez (mvillagomez@tzvs.ec).

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This publication contains information of general interest and does not constitute legal opinion on specific issues. Any analysis will require legal advice from the Firm.